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Citizens in Mallorca pledge gold and jewels like never before

Due to the economic crisis caused by the corona pandemic, more and more citizens in Mallorca are forced to pledge their family jewelry. The official pawnshop in Spain, Montepío, registers many more applications in the Balearic Islands than in any other region in the country, the daily Ultima Hora reported on Sunday. It is mainly tourism workers who carry gold and jewels into pawn shops in order to obtain financial loans.

In Palma in particular, the economic recession has a very negative direct impact on companies, the self-employed and families. In contrast to previous years, the spectrum of customers who pledged jewelry was wider in 2020. “Here we have to include hoteliers, restaurateurs, airport employees and freelancers from all productive areas,” said the pawnshop.

In terms of the amount of loans granted, Palma recorded the highest growth in recent years with an increase of over 13 percent, which was partly attributed to the rise in the price of gold.

The Montepío of Palma is by far the depository with the highest average credit in the Spanish network, it said. The loans reach an average of 835 euros, the Spanish average is only 650 euros. Loans of 50 to 20,000 euros are granted. The amount depends on the quality of the jewels and the purity of the gold. The rates offered range from 5 to 8.25 percent, depending on the quality of the jewelry at the time of the estimate.

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