In yet another sign of the times, the old Wachovia Bank branch on Highway 9 in Roswell, Ga., is now a pawnshop. Dubbed The Vault, the shop has reported increasing business during its four months of operation. So have other pawnshops across the country, as hard-pressed borrowers seek alternatives to tightfisted banks and other financial institutions.

“Any time that traditional financial sources cut back on credit, we do well, because there are a lot more customers who don’t want to deal with banks,” says Thomas A. Bessant Jr., CFO of Cash America, the country’s largest provider of “secured nonrecourse loans” (that is, pawn loans). “In good times or bad, our customers like the simplicity and ease-of-use of our service.” Last year, Cash America saw a 14 percent increase in pawn revenue, which makes up 70 percent of its operating income, says Bessant.

At posh Beverly Hills pawnbroker The Dina Collection, business started picking up about eight months ago, according to owner Yossi Dina. “Lately, a lot of clients are businesspeople who need quick money for their businesses,” he says. “And they can’t go to the bank.” Dina says a prominent movie producer recently attempted to borrow funds against his Oscar statuette.

Another flourishing source of alternative funding is art lending — loans secured by fine art. Lending at Manhattan-based Art Capital Group rose 40 percent in 2008, and CEO Ian Peck expects that upward trend to continue in 2009. “For some people it’s a defensive move. They are not comfortable having $150 million in an art collection that they can’t sell,” he says. Another Manhattan art lender says that, with liquidity at a premium, “more people are looking for just this kind of alternative financing.” Call it the deal of the art.

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