ABSTRACT
It has been argued that the East Asian economic miracle was, in large part, fuelled by the dynamism and efficient functioning of informal financial institutions in a region generally lacking well developed money markets (Waldron 1995). This chapter focuses on how the pawnshop – a form of traditional microfinance – continues to play a role in Singapore, a country with a highly developed formal banking sector. Singapore's pawnshops have been operating as commercially viable businesses for decades. In fact, the government's SingPost has recently begun providing a pawnbroking-like service of its own, known as SpeedCash. This belated move into pawnbroking by the state is economically motivated – SingPost’s prices are clearly not set at charitable levels – and speaks volumes about the profitability of this form of credit provision. The long-term commercial viability of Singapore’s pawnshops may hold lessons for the commercialization of microfinance institutions worldwide (Campion 2002).
