Pawnshop business - Apply for a permit

If you would like to work as a pawnbroker or pawnbroker, you need a permit.

The pawnbroker grants a money loan against deposit of a pledge to secure the loan together with interest and costs of business operations.

The pawn broker arranges pawn transactions by granting an advance on the pledge handed over to him/her and pledging the pawns in his/her name with a pawnbroker.

Anyone wishing to operate the business of a pawnbroker or a pawnbroker requires the permission of the competent authority. The permission may be subject to conditions insofar as this is necessary for the protection of the general public or the pledgers.

In the case of partnerships (e.B. OHG, KG), the trader is every managing partner. In the case of legal entities (e.B. GmbH, AG), the permission of the legal entity is granted.

  • Identity card or comparable identification document (copy)
  • Non-EU citizens: residence permit (copy)
  • Proof of entrepreneurial legal form
    • Headquarters in Germany:
      • in the case of registered companies: extract from the commercial register and, if applicable, a copy of the articles of association (e.B. in the case of a partnership under civil law (GbR))
    • Company headquarters abroad: Documents from this country that prove the legal form.
  • Proof of personal reliability
    • Residence in Germany:
      • Certificate of good conduct
      • Extract from the Central Trade Register for natural and, if applicable, legal persons
    • Residence abroad: documents from your home country proving that you have the personal reliability to perform the requested service
    • On a case-by-case basis, the authority may request further documents that are suitable for making a statement about your personal reliability as an applicant.
  • Proof of the means and guarantees required for operation
    • Residence in Germany:
      • Extract from the debtor register
      • Information from the insolvency register
    • Residence abroad: Documents from your home country as proof that you have the necessary means and collateral
  • Social
  • Floor plan of the rooms intended for commercial operation

Preconditions

If you want to work as a pawnbroker, you must provide special collateral and proof.

  • You must provide evidence of necessary funds or collateral for the first six months. These can be credit balances or a bank guarantee.
  • Furthermore, you must take out insurance against fire damage, water damage, burglary and robbery and present it when applying. A safe must be available for jewellery.
  • You must secure your premises against burglary by means of an alarm system.
  • In the case of car pawn loans, the question of the possible environmental hazards posed by the parking areas of the vehicles must be clarified.

Permission is denied if:

  • Facts justify the assumption that the applicant does not have the reliability required for the business. As a rule, anyone who has been sentenced to imprisonment in the last five years prior to the application for a crime, theft, embezzlement, extortion, fraud, embezzlement, forgery of documents, theft, usury or for offences against the law against unfair competition does not have this reliability.
  • The applicant does not prove the funds required for the business operation or corresponding securities.

Hints

The pawnbroker must notify the competent authority at the beginning of the business which premises he/she uses for the business enterprise; furthermore, he/she must immediately notify of any change in the premises used for the business operation.

The pawnbroker is obliged to keep the accounts.

Related Links

  • ยง 34 Industrial Code (GewO)
  • Ordinance on the Business Operations of Commercial Pawnbrokers (Pfandleiherverordnung - PfandlV)

You must apply to the competent authority for the purpose of operating a business as a pawnbroker or pawnbroker.

After the exam, you will receive either permission or a rejection notice. A permit may be subject to certain conditions.

Responsible for the content
Bavarian State Ministry of Economic Affairs, Regional Development and Energy

Last update or date of publication
14.04.2021