Ineligible for Centrelink benefits and unable to secure a personal loan, she was loath to borrow from family members, some of whom had already spotted her some cash for her trip. Having worked as a salesperson at Cash Converters during student days, Allen was familiar with the system. She decided to pawn her only portable item of major value, her engagement ring from a failed marriage three years earlier, for $1500, redeemable with monthly interest of 25 per cent. Pawnbrokers offer short-term loans in exchange for items of value, which they retain as collateral until their money is repaid with interest. The maximum advance is usually about half the second-hand resale value of an item. Interest is charged monthly, at a rate set by the pawnbroker. About 20 per cent is common, although some outlets charge double this. If an item is not redeemed, or its loan term extended, the pawnbroker is entitled to sell it to recoup its funds. Most also operate as second dealers and buy and sell items outright. ''I thought about a private sale on eBay but I needed [the money] quickly,'' Allen says. ''That's where the pawnshop came in. The process itself was quite easy … If there's no other options, it's a good option to go for.'' It's not clear how many pawnbrokers are operating in Australia. The ABS does not collect specific statistics on the sector. In NSW, they're regulated by the same licensing regime as pay-day lenders and second-hand dealers, although many of the latter do not lend money.

While one-offs such as Allen are not uncommon, pawnbrokers say the bulk of their business comes from repeat customers, who pawn the same item over and over. The owner of Fairfield Loan Office in western Sydney, Laurie White, has been in business for 40 years and sees about 20 customers a day. Many of his regulars are new migrants or people on benefits or low incomes, with no cash reserves or access to conventional credit. When they're hit with an unexpected expense - a power bill that's higher than expected or car repairs that can't be deferred - he's their only option until pay day comes round. Others are poor money managers. ''A lot of people don't plan or budget well and use us as a stopgap,'' White says. ''Some people are in every month or every other week. I know 50 or 60 per cent of them by first name. It's always for the same problems … There's a tremendous amount of people with no other service available to them.'' A small sum is sufficient to tide most over. While pawnbrokers occasionally lend five and six figures, the average is about $100. It's too little to warrant applying for a personal loan or credit card, even if criteria could be met. Time is also of the essence. Bank loans take several days to be approved and ''people have got a bill to pay tomorrow'', White says. ''They just want a quick fix.''

Shanon Folden, the general manager of Happy Hockers, which has four outlets around Sydney, says the pawnbroker is as much social worker as hard-headed haggler. ''Everyone has a different reason why they're borrowing money,'' he says. ''You've got to ascertain what someone needs … we help people in their hardest moments. We're like the bank of last resorts.'' In times gone by, lawnmowers, electric irons, TVs, VCRs and portable stereos were popular collateral; these days jewellery, mobile phones and all things Apple are the most common items to cross the counter. Occasionally customers proffer more esoteric goods. Folden says he's been asked to lend on bondage gear, old telephone boxes and 1200 head of cattle, while White reports being offered ''the cross off a coffin, false teeth, hearing aids and the gold bridge from someone's teeth''. About 75 per cent of customers redeem their items, usually within three weeks, Folden says. Loading

Melbourne accountant and financial adviser Steve Enticott says while the interest rates are ruinous, the industry provides a lifeline to people who are out of other options. ''Where else would you go if you haven't got family support?'' Enticott says. ''People that use this service respect it - they know it's a last resort and, if they burn the pawnbroker, where else will they go?''