Specialist pawnbrokers in Hong Kong are supplying customers with loans against the value of their Gucci, Chanel, Hermès or Louis Vuitton handbags as they are considered goods that retain their retail value.
BY Bibby Sowray | 16 August 2013
If you want to buy a designer handbag but are held back by pangs of price tag guilt, just look to Hong Kong. There certain designer handbags are considered safe investments that often retain their retail value - so much so that you can even use them as collateral to take out a loan.
Yes Lady Finance Co. is one such lender. The company offers cash-strapped but designer-heavy women (and occasionally men, who make up one in five of their customers) a loan within half an hour at 80% of their bag's value, as long as it is by Gucci, Chanel, Hermès or Louis Vuitton. Special editions and vintage classics give even better loan leverage.
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All bags are assessed for authenticity by the company's affiliate and second-hand designer goods expert Milan Station Holdings Ltd before any loan is approved. Recently a Hermès Birkin, one of the French design house's most iconic bags, allowed one customer a $20,600 (£13,170) loan. A brand new Birkin will typically cost upwards of £4,000 with some selling for as much as £100,000 if a limited edition or made in exotic skins, and they are known to hold and often increase their value the older they become.
The Wall Street Journal reports that "almost all" of Yes Lady's customers pay the loans back in full within the time period and get their beloved bags back.
Those who use the service include people whose money is tied up in savings or the stock market. One customer, named Ms Wong, trades in her Gucci and Louis Vuitton bags whenever she's struggling to cover daily expenses or her son's school fees, while another, Angel Yam, traded in a Chanel bag for a $1,550 (£960) loan that she used to travel and buy stock.
Yes Lady Finance, which translates to 'Rich Woman' in Cantonese, and similar companies are "carving out a niche in a city with 200 licensed pawnbrokers and over 900 more-typical lenders" that primarily target low-income earners.
Source : http://fashion.telegraph.co.uk/news-features/TMG10247430/Designer-handbags-Hong-Kongs-new-currency.html