The so-called new economy is, in most cases, just the use of technology to circumvent the rules and regulations of the old economy. By operating on-line, they can escape state regulators. This company is a good example. it is hard to tell from the site, but their marketing suggests they are an asset backed lender. That means they lend to people who can pledge an asset that is of greater value than the loan. That’s different from an underwriter, which fund a purchase of an asset.
Pawn shops are almost as old as prostitution. Mosaic law addressed lending, which in those days was exclusively asset based lending. The Greeks and Romans had pawn brokers. English law is based on Roman law as regards pawn brokers. In America, every state has laws regulating pawn shops. The pawn shop owner has to undergo a background check and be finger printed. They are required to keep detailed records of all items taken in and get positive identification of the customers. The state requires these records to be made available to police on demand.
That’s what’s puzzling about these on-line operations. Where are they licensed and how can they do business across state lines? Here’s an article from a couple of years ago on the growth of mega-pawn shops. It’s not hard to see where this is headed. Local pawn dealer will start buying protection from their state legislature. The Internet guys will try to do the same and we get a replay of Tesla in New Jersey.
Anyway, it is a good example of how we are running out of places to employ technology to squeeze out profits. The low hanging fruit from the information age has been picked. We are now into the great settling out as the dust clears. Just as the great fortunes of the industrial age were built prior to the Great Depression, the great fortunes of the Communications age have been built prior to the Great Recession. There are a few plumbs to be picked and maybe ePawn is one of them, but the pickings are slim.