After a long wait, workers and businesses are gradually returning to their new normal lives. However, difficulties caused by not being able to meet the cost of living, cash flow shortages and the risk of not being able to maintain production are still causing anxiety and insecurity among many people at this moment.

After more than five months of social distancing, even though things have returned to normal on many levels in most localities, financial difficulties are ongoing, especially for small businesses and workers. On many streets, even in districts in the centre of Saigon, where there were bustling trading places, there are still lots of shops that are in a state of silent closure or have signs offering subleases. The number of unemployed people is increasing day by day, with capital shortages and salary-related debts hard issues for many enterprises.

Due to labour supply disruption, many people are still unemployed

According to Ms N, the owner of a fashion shop in HCM City: "Although the city has reopened, the number of visitors compared to last year has decreased significantly. Sometimes the revenue not only falls short of paying the rent but also the family’s monthly living expenses”.

The major challenges that citizens and businesses are facing after this pandemic are pressures from changes in supply and demand in the market. According to the Youth newspaper: "Over one million employees have lost their jobs, accounting for 41.2 per cent of nearly 2.5 million workers participating in social insurance”. Given the severity of this damage, the slow recovery of supply and demand in the domestic market is leading to continued difficulty in job opportunities.

The owner of a chain of karaoke bars with more than 600 employees and 20 branches shared concerns about the future in VnExpress: “We have borrowed a large sum of money to support our employees and maintain machines and facilities, but we are facing the risk of falling into a state of exhaustion and closing down”. Further, this is by no means an isolated business case after the pandemic.

According to the General Statistics Office, in September 2021, the number of enterprises withdrawing from the market increased by 15.3 percent reaching more than ninety thousand enterprises. On a monthly average, 10,000 businesses withdraw from the market, mostly due to the severe impact of COVID-19 and being unable to withstand the onslaught of this pandemic.

The keyproblems arising in the current economic situation are worker unemployment and the fact that businesses are still struggling to manage, maintain and endure current conditions, while finding a development direction to adapt to living with the pandemic. Any solution that helps citizens and businesses "survive" after COVID-19 in a "fast - concise - quick" way is a top priority for the economy and will offer the opportunity to develop new business trends in the future.

Pawning is a financial solution for many people

Since the COVID-19 pandemic appeared, while small- and medium enterprises have found ways to live with the epidemic and tried to maintain operations, workers have struggled to earn a living every day. According to Ms V, a market vendor: " After Government Directive No. 16 was issued, all activities were forced to stop, and worries about living expenses and rental fees has never ended. In order to get by, I had to pawn my wedding ring to make ends meet”.

Mr Th, an owner of a small business, said: "After social distancing measures end, I will come to redeem my car. This pawn company has good loan interest rates, clear contracts and a strong operating network so I don't worry about their business.” The pawning of his car helped Mr Th quickly turn around capital during the pandemic to avoid the closure of his remaining garment workshop.

The Vietmoney system continued to comply with the 5Ks during the opening process to serve customers during the pandemic.

Pawnshop Chain Ascends the Throne

In the last period of 2019, before the Covid pandemic appeared, the VietMoney chain of pawnshops attracted attention when it was invested in by two investment funds, Probus Opportunities (Luxembourg) and Digi Ventures. Currently, the network operates in the Southern provinces. Even though most businesses have faced difficulties, the VietMoney Pawn Chain announced a sales growth of more than 200%, at odds with many other fields in the market.

Looking at the financial services landscape, pawn service have been very popular in many countries around the world. Some companies have developed their brands into large chains in Southeast Asia such as Thailand, Indonesia, and Singapore, as well as Europe. In Italy, pawn services have become part of the banking systems there through many epidemics, wars, and economic recessions in the past. During the outbreak of the COVID-19 pandemic in Italy last year, pawn services in Europe's third-largest economy boomed thanks to high demand.

In Vietnam, people are often cautious when pawning at small and traditional stores because they can be overcharged or pawn items, such as electronic devices, can even have components swapped. Also, interest rates at these stores are unclear. Recently, the appearance of pawn chains that operate professionally  and transparently has created a demand for pawning to become more modern and professional. For example, the VietMoney chain of pawnshops allows customers not only to pawn normal cars or electronic products but also jewellery, diamonds and luxury goods.

Mr Trinh Van Phuong, CEO of the VietMoney Pawn Chain said: "Changing the concept of a product or service is not easy and cannot be done just by altering the form. In addition to using technology to ensure accurate valuation, we also provide value transparency, a good customer experience and best practice in transaction execution. Along with these is also, of course, a reasonable cost."

According to our observations, the pawnshop service industry is still a necessary service sector, stemming from the living needs of consumers, as well as small and retail businesses. This service has ample room to develop and serve society if it is properly invested in and cared for, especially when economic conditions are volatile or in recession.

The advantage of pawn services is that they meet the demand for quick and instant loans. The emergence of large-scale pawn chains which have transparency in operations, clear interest rates and are community conscious, like VietMoney, is part of a trend to solve the subprime credit problem in the market, especially when many businesses and people are facing difficulties due to the pandemic and need quick and timely financial solutions.