Dressed casually in a T-shirt and with a sunny smile, Thomas Hung Cheung-hong is a fresh face in pawnbroking, a time-honoured business still bound by traditional practices. Presiding behind the grille of an elevated counter, he towers over customers, who must raise their arms to hand over items to be assessed. But the owner of the Yan On Pawn Shop in Kwun Tong knows not to look down on clients who are strapped for cash: they must be treated with understanding and respect if he wants repeat business. So when a regular is late with his monthly interest payment, Hung decides not to charge a penalty, since there was a reasonable explanation. And to attract more customers, he keeps his interest rates below the maximum allowed under the law. 'Times have changed. This is a service-orientated industry, after all, and good service makes a difference,' says Hung, who gave up his job as a government forensic scientist to take over his father's business a few years ago. Under the Pawnbrokers Ordinance, shops can charge customers monthly interest of up to HK$3.50 for every HK$100 loaned. Items put up as collateral may be forfeited if borrowers fail to redeem them after four months. Pawnbroking has probably existed in China in some form or other for millennia. In Hong Kong it was legalised in 1926, which makes it one of the oldest trades in the city. Despite its archaic image, it's far from being a vanishing trade: the number of registered pawnshops has increased from 152 to 167 over the past six years, according to the Hong Kong and Kowloon Pawnbrokers Association. The recent economic upswing probably helped: contrary to popular belief, pawnbrokers do better in boom years, says Hung. 'We're hit pretty hard when the economy is in the doldrums, like during Sars. We definitely benefit from a good economy because people use money more, thus there's a higher cash turnover rate.' Pawnshops are found across the city, although there is a greater concentration in Central, Wan Chai, Sham Shui Po and the Yau Tsim Mong area. Most are run as family businesses and owners typically avoid publicity in order not to scare off customers and for security. 'We're still conservative and don't want to expose ourselves to danger,' says Hung. 'Someone might try to rob us if they know how the place is set up.' Like other owners, Hung bans photography on the premises. 'A higher profile brings little advantage; those who need to patronise us will come anyway. It's not as if we would have more business if we put up a poster somewhere,' he says. Keeping a low profile hasn't hurt the two pawnshops in Lucky Plaza, a mall in Sha Tin. Nearby finance firms may have to resort to aggressive tactics such as having employees approach passers-by, but pawnshops 'wait for people to come to us, not the other way around', says a shop assistant who declines to be named. Although finance companies offering easy loans may present some competition, most pawnshop operators reckon the impact on their business is limited. 'We serve different kinds of clients. You can obtain cash from us straight away, whereas it's more time consuming to get your loan application processed,' says Kit Chung, 22, who followed his father into the trade at the Tai Hing Pawn Shop in Lucky Plaza. Many shops still adopt the traditional layout of Chinese pawnbrokers, with a counter at head height for better security, a screen in the doorway to afford customers some privacy and a familiar sign associated with the business - the auspicious symbol of a bat holding a coin. But a few, such as Tai Hing, which opened four years ago, have taken a cue from operators in Macau by switching to waist-high counters that allow customers to have a full view of staff working on the other side. 'We want to be approachable to our customers and they feel it's more fair this way,' says Chung. 'They can see what we are doing and put more trust in us.' Modern times have brought other changes. Before the second world war, pawnshops usually occupied multistorey premises because items in hock included bulky goods such as winter quilts. But such items fetch little money now and many shops have been scaled down as they need less space for valuables such as watches and jewellery. Hung, for instance, finds the 350 square foot ground floor space of his premises sufficient, and has rented out the second floor for extra income. He says the trade has its merits, despite its image of usury. 'When you hock something valuable to get a loan, you're more likely to remind yourself to keep spending under control because of the need to redeem it. It helps nurture more responsible spending habits. It's also easy to calculate how much interest you have to pay. You're in better control than when borrowing money from banks and finance companies, where interest and other fees may add up exponentially.' Hung estimates that 80 per cent of his customers redeem their valuables. Many still think of pawnshops as a last resort for the poor but their clientele includes people of all stripes - 'just whoever's in desperate need of some quick cash', says Chung. 'They can be gamblers, shoppers or people who want to buy stocks.' Foreign domestic helpers have become a big category of customer over the years, most likely because they are not eligible for bank loans. Some shops try to woo them by putting up posters in Tagalog or Bahasa Indonesia at the door. Maids often find pawnshops useful in emergencies. Karsi Wina, an 28-year-old Indonesian helper, had no choice but to pawn a prized gold ring last October to get HK$300 to see a dentist. 'My dental problem got very serious but it was not covered by insurance,' she says. 'My previous employer refused to lend me the money so I had to hock the ring, even though it has special meaning to me.' Wina, who redeemed her ring a few days later, says: 'I would rather have borrowed from close friends but I didn't have any back then.' She says many of her friends turn to pawnshops because they need to send money home before payday. 'Especially now, everything is pricier and we need more cash to get by.' To prevent stolen goods being offloaded on pawn shops, the law requires borrowers to be over 18 and provide proof of identity and an address. Even so, it takes a discerning eye and considerable experience to gauge the value of goods being hocked. 'It's very intuitive and takes years of practice. You have to judge the borrower as well, the way he looks and behaves,' says Hung, adding that his background in forensic science helps enormously. 'It's also about observation.' But the trade tends to be restricted to insiders and newcomers are usually introduced by friends and relatives who can vouch for their trustworthiness. 'It's the only thing I am good at,' Chung says. But he is still wary about revealing where he works. 'I'm afraid people might take advantage of it,' he says. 'But I enjoy the job because I never have trouble getting gifts for friends.'