PawngoJanet Barbour wanted to take her 11-year-old grandson Brian to Disney World, but money had been tight since her husband's death. So the 63-year-old Barbour arranged a loan through an Internet pawn broker called Pawngo. She put up seven diamond and emerald rings as collateral for $700 at 6% a month interest, and off the two went from their Charlotte, N.C., home to the Magic Kingdom in Orlando, Fla. "It didn't cover it all, but it did cover tickets and part of the gas," she told DailyFinance.

Two-year-old Pawngo bills itself as a more upscale pawnshop for the digital age, and Barbour as the new breed of pawn customer -- not desperate, just temporarily cash-strapped. The average loan from a storefront pawn shop is $150, while the Pawngo average is $2,000, according to the company.

"Our services are meant for people that have assets that don't necessarily want to sell their assets," explained Pawngo CEO and co-founder Todd Hills. "It's a difficult time."

Barbour checked out the local brick-and-mortar pawn shops and said she was turned off by the 20%-plus interest. Pawngo's rate runs between 3% and 6% a month. If you borrow $1,000 at 6%, $60 a month is automatically debited from your bank account until you repay the loan. Otherwise, the electronic pawn outlet operates pretty much the same as a brick-and-mortar store, with stay-at-home convenience. (Those low numbers may seem fairly painless, but it's worth noting: Even without the compounding interest trap, that's actually an annual rate of 72% -- much higher than the most expensive credit card.)

You click on and answer questions about your collateral. You then agree to temporary terms and Fedex the item or items to Pawngo (on their dime through a digital shipping label). Pawngo offers 50% of the appraised value as a loan and deposits the money in your account as soon as you give the final OK. You have three months to pay the loan back.

Less Sleaze, More Ease

The company is trying to dispel the pawn shop stereotype of a sketchy storefront dealing in fenced goods. Heck, let's throw in a cigar-chomping sleaze in a moth-eaten sweater behind the counter to complete the picture. Pawngo is supposed to be the pawn shop your grandma would visit -- virtually anyway.

Hills pointed out that unlike a default on a mortgage or car loan, his company -- or any other pawn shop -- will not kick you out of your house, take your car, bash your credit rating or take you to court. Pawngo merely keeps your modest assets and sells them to pay back the loan. It will gladly do business with you again, should an emergency come up like a plumbing catastrophe or car breakdown, Hills said.

"It's really the oldest form of borrowing," he said. "You're borrowing money against your past and you're not leveraging against your future. We've developed a much friendlier user experience to get things done."

A Google search for "online pawn shop" produced no other obvious competitors on a national scale. Pawngo recently underwent a so-called "rebranding" and relaunch in June to reflect its motto: "The Pawn Shop Reimagined!" Since its inception, the company has known nothing but recession and recession hangover followed by the threat of a relapse. Pawn shops generally thrive in that kind of economic climate. The stock price for pawn shop operator Ezcorp (EZPW) doubled to $38 a share in the last year, AP reported. The number of Florida's pawn shops doubled in the past year -- the state now houses 1,280 of the nation's 10,000 pawn shops, the National Pawnbrokers Association told the Miami Herald. And reality shows like the History Channel's Pawn Stars have raised awareness of pawning as well.

Pawngo, backed in part by Groupon founders Eric Lefkofsky and Brad Keywell, already has loaned out more than $2.5 million, Hills estimates. Its loan cap per person is $1 million. One of the biggest borrowers so far was a trucking company owner whose fleet sputtered into the shop, Hills said. He forked over a Rolex, a Cartier and some diamonds for a $50,000 loan.

Barbour, the North Carolina grandmother, might not have a business to save, but she's ready to pawn again for a vacation after she gets her rings back. "If I want to take a cruise," she said, "I have no reservations whatsoever."

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Troy Perkins

This online pawn shop have the lowest rates in the U.S. due to Texas OCCC regulations.

August 15 2013 at 3:56 PM Report abuse rate up rate down Reply

Online pawn shops offer convenience and lower interest rates on pawn loans than neighborhood shops. Be sure to check them out before you send them your valuables. Pawntique, the New England based online pawn shop, provides a Due Diligence Checklist for that purpose.

Don Battis, CEO Pawntique

February 18 2012 at 5:57 PM Report abuse rate up rate down Reply

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September 28 2011 at 1:29 AM Report abuse rate up rate down Reply

'The company wants to dispel the stereotype of sketchy storefronts dealing in fenced goods' !

Who knew that unions were organizing pawn shops? I thought the mafia owned them already.

September 03 2011 at 6:24 PM Report abuse +2 rate up rate down Reply

I would like to pawn Congress and the President but no one would give me the time of day for the lot of them..

September 03 2011 at 2:34 PM Report abuse +4 rate up rate down Reply

I am a little confused. This nice grandmother who wanted to go to Disney borrowed $700 at a cost of $42.00 per month.I wonder how long it took her to pay off the loan and what her total interest cost was. I bet if you compare how much she paid for the "instant gratification" vs saving up for the trip, she would be able to afford that cruise now. I can understand how important this might be for a person to get their car repaired so they could get to work to earn a living or to solve some other emergency but this is stupid.

September 03 2011 at 7:26 AM Report abuse rate up rate down Reply
1 reply to frdntfarm's comment

Once you are hooked on instant gratification it is hard to go cold turkey and enter rehab. Even Grannies think it is easier to just 'do it' and ask for forgiveness later regardless of the cost in the end. I hate payday loan places even more, They were charging poor people 32% interest !!!! At least we banned them in AZ.

September 04 2011 at 12:07 AM Report abuse rate up rate down Reply
Terry and Mandy

Pawning your jewelry for a trip to Disneyland is crazy. Why not wait until you have the money, then go? Instant gratification has become a huge problem for our economy. Many are not willing to save the money to have the things they want. And many cannot afford all the things they buy on credit. Pawnco has a ridiculously high interest rate and offers 50% of their appraised value. What a Scam! And if you don't continue to pay their high interest each month, bye-bye jewelry and 50% of what it might have been sold . Learn to live within your means.

September 02 2011 at 1:15 PM Report abuse +7 rate up rate down Reply
1 reply to Terry and Mandy's comment

Appraised value= Story that should start off with "once apon a time"
You can't sell for "Appraised value" to anyone, as it's sooo inflated.
If these people will lend you 50% of "Appraised Value" they are going to eat a lot of loans.
I believe what the writer should have said is "They will lend you half of whatever it's worth to them".
As a pawnbroker, I can see a lot of holes in this whole article.
Appraised Value often means "I saw one for sale on eBay for that much", not that it ever sold.
Big difference between an appraisal and an opinion. Appraisals usually cost money, opinions are free and worth every dime of it.

September 02 2011 at 4:28 PM Report abuse +2 rate up rate down Reply

you need an angle to survive in this world

September 02 2011 at 11:27 AM Report abuse -2 rate up rate down Reply
1 reply to JOHNNY's comment

And you need a brain... this granny doesn;t have one. Look at the example she is setting for h er grand children.

September 02 2011 at 1:29 PM Report abuse +2 rate up rate down Reply