Trading also moves in strata 4 and 5

And it is that despite the economic slowdown that has greatly undermined the purchasing power of regular users in these premises, contrary to what one might think, not only people from low strata go to the traditional business of buying and selling, but also people from strata 4 and 5 are also frequent customers.

“On its best day, for example, when someone wears a brand watch, a local dealer can move up to $2 to $3 million depending on the sector. In the northern neighborhoods of Bogotá there is more movement. In addition, not only do clients from strata 1, 2 and 3 come, but also people with economic emergencies from strata 4 and 5. The needs are in full order, ”said Víctor Manuel Celis, legal advisor to Asocom, a union branch that defends the interests of half of the 1,000 purchases that are distributed throughout the capital.

People who cannot access the formal financial system, either due to urgency or because they do not meet the necessary requirements, have the opportunity to go to sales where the mechanism is very simple: they leave an asset with the option of the seller to repurchase it within an agreed term.

“A totally legal contract is established. We buy the item from the person for a mutually agreed price, we agree on a term and a resale price for which they buy the item back from us, which can range from 2% to 9%. They cannot be called interest. And if that established time passes and they don't repurchase it, it automatically becomes the property of the sale", explained Celis. In that sense, these companies do not define themselves as pawn shops or pawn shops, and they are very strict in stating that they do not lend money.

In general, the articles that are most found in these establishments are, first of all, jewelery due to its high value; then appliances of all kinds appear; and, ultimately, tools such as polishers, fasteners or welding equipment, among others.

In addition to traditional businesses, with the appearance of new financial entities specialized in granting lines of credit more easily, plus illegal 'drop by drop' loans, now the largest purchases and sales are aiming at diversification.

“In recent years, the sector has been declining, especially in Bogotá, due to the proliferation of this type of financing for people with lower resources. Now, many shopping chains have begun to offer new products and services such as recharges, sales of the Mandatory Traffic Accident Insurance (Soat), collection of public services or money orders, among others," said Sandra López Solano, director of the National Federation de Almacenes de Compraventa con repurchase agreement (Fenacoven), an entity that brings together 1,200 stores spread over 22 departments in the country.

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It is noteworthy that despite the fact that it is estimated that the sector produces some 50,000 jobs between direct and indirect, only 17.14% of the total of these stores for sale and purchase are affiliated to unions, which shows that this sector, like many others of the economy, is one with a fairly marked informality.

According to Alejandro Useche, a professor at the Universidad del Rosario School of Administration, "a company is understood to be formal when it is registered with a chamber of commerce, has a commercial registry, its workers are affiliated with social security, pays taxes and complies with other established trade regulations. Thus, there are few trading businesses in the country that meet this definition and, therefore, most of these companies operate informally.

Locals are a support network for the Bogotá Police

According to the trade union section Asocom, for a year, the around 1,000 establishments of this type in Bogotá have formed a security front with the direction of citizen coexistence in which they have radios to communicate with the Police and help to give part of criminal and suspicious behavior. In addition, the guild is also responsible for training all people in labor, legal and social issues, among others.

the opinions

Sandra López Solano Executive Director of Fenacoven“We are not pawnshops or pawnbrokers. We generate more than 40,000 direct jobs and 10,000 indirect jobs throughout the country”.

Alejandro Useche ArévaloProfessor of administration at Universidad del Rosario“Informality implies that there is no guarantee that clients will be treated under the legal parameters of this activity”.