London pawn shop

The first pawnbroker to open in London's financial district in nearly a decade says it's doing a healthy business, a result of the economic downturn.  With the recession biting and large bonuses a thing of the past, some workers in London's financial sector have been pawning expensive watches and diamonds to secure extra cash.   

Nikolas Michael

has just opened a pawn shop in London's financial district, in the shadows of gleaming offices that belong to now struggling firms like Royal Bank of Scotland and UBS.

Partner Michael Julian says the company spotted a good opportunity.

"We saw a gap in the market, we realized that there wasn't a pawnbrokers in the square mile, and we decided it was a risk worth taking with the credit crunch affecting people's ability to get credit from mainstream financial institutions," said Michael Julian. "We're offering an alternative to them."

City workers are turning to the fancy baubles they bought when times were good, to get through leaner days.  Valuables can be exchanged for loans, with six months to repay, or the item belongs to the pawnbroker.    

One customer who refused to give his name said the company opened at just the right time.

"Well I read it in the paper that a Nikolas Michael were opening up," he said. "It's quite a rare thing because of the credit crunch and stuff, so I came along to pawn some goods I've got, get some hard earned cash."

The company says business is booming.  

Michael Julian says many people are bringing in high-end items to exchange for loans.  

"They're bringing in Rolex watches;  they're bringing in Cartier watches, diamond jewelry, anything," he said. "They're bringing in designer jewelry as well, say Tiffany and Jaeger, brands like that which are very high end."

Times are tough in the City of London, even for those who've kept their jobs, but not everyone likes the idea of pawning their belongings.

"Mid recession, any money you can get is good money to be honest, but from what you get there and what you're tied into doing, I don't think it's necessarily the best thing to do, I'd still go through typical sources," he said.  

"The credit crunch is hitting, every family quite hard these days so I have given it some thought already so yes unfortunately," he said.  

A pawnbroker opening in the heart of London's financial district could indicate how hard city workers have been hit by the economic crisis.  Its success could mean that workers believe a recovery is some way off.