Networks of pawnshops in Ukraine are tired of standing on the sidelines watching crypto take over the world. These money lenders have decided to join the blockchain money spaceship to the moon.
Loan offices in Ukraine are creating a unique lending service targeted at crypto holders. Borrowers will soon be able to get loans in fiat currency equivalents of their favorite crypto assets.
Before the crypto venture, Skarbnytsya boasted of being the pioneer and largest non-government owned network of pawnbrokers in Kiev and Ukraine. Specifically:
“Using the product from the leader in the market of pawnshop services, you get the most modern and reliable version of kriptokredit, while the security of your pledge is guaranteed completely legal and official contractual relations, as well as more than 25 years of impeccable reputation of the company ‘Skarbnitsa.’”
As found on the business’s website, the credit union has a customer base of over one million clients. These customers are serviced by 1,200 dedicated employees spread across its 300 pawnshops. The firm claims it renders the highest quality of service in the nation’s non-bank lending industry.
Skarbnytsya announced last week that in conjunction with its partners, it would soon start accepting cryptocurrency collaterals for loans.
In essence, established cryptocurrencies like bitcoin and ethereum can be used to secure vast amounts of loans compared to other small volume cryptos.
The loan office has made it clear that the entire process of obtaining the virtual currency-secured loans will be a frictionless one, without undue delays and obscure formalities.
In the firm’s FAQ section, they made it abundantly clear that these loans will all remain within the boundaries of Ukrainian legislation.
Skarbnytsya has hinted that the term and the amount of loan a client can get are determined solely by the type and volume of the digital asset being used as collateral.
Once a client sends their loan request along with the virtual currency security, the IT department will automatically check out the amount and market price of the digital asset to determine how much loan the client can receive.This attention to market movements also works in the opposite direction.
In the case of a particular steep drop in price, all parties are provided with a specific stop-loss by the loan firm:
“You will receive automatic e-mail and SMS notifications when the exchange rate drops by 20 [percent] and 25 [percent]. If the rate falls by 30 [percent] or more, your cryptocurrency will be automatically realized, and the funds received are directed to repayment of the loan debt.”
The company also stated that cryptocurrency holders can get fiat loans in Ukrainian Hryvnia (UAH), without fees or hidden charges. Clients are given up to 31 days to repay their loans and the days, if needed, can also roll over.
This system is particularly excellent for people who need quick cash but are not ready to sell their crypto assets for cash yet.
Instead, they use it as collateral to get the required cash while their HODL continues in the wallet of the pawnshop until they repay their loans.