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Cash America is
a chain of Fort Worth pawn shops with over 460 stores.
The largest pawn shop chain in the world, Cash
America is expanding, trying to reach those along the Mexican border
with their business. The
company is like any other pawn shop, offering short-term loans in
exchange for valuable collateral that they can turn around and sell in
the storefront should the borrower default on the paycheck loan.
Why would Cash
America be interested in the border business?
Most people in Mexico do not have checking
accounts and regularly do business with Fort Worth pawn shops and other
paycheck loan providers, taking out short-term loans and purchasing
from the stock within the pawn shop.
It is an everyday occurrence to deal with a
pawn shop for most Mexican citizens.
Business from the Mexican market is sure to
increase profitability for the company by leaps and bounds.
Currently, Fort
Worth pawn shops are taking advantage of the short-term loan business
in Mexico (based out of Arlington, a suburb of Fort Worth), and they
have been extremely profitable for their efforts.
Though Cash America claims to have no plans to
expand its Forth Worth pawn shops and follow its competitor into Mexico
due to differences in regulation, the company does wish to prosper from
border business. With
constant border traffic, Cash America is sure to make money from
short-term loans requested by border citizens.
The
short-term loan business has proven quite profitable, and as the
largest pawn shop in the world, Cash America has seen the financial
benefits of its Fort Worth pawn shops and their businesses in other
cities, with shares up by more than 120% in 2003 alone (during a
three-year economic slump in the U.S .).
The market is not slowing now, even with
improved economic reports in the United States, and is, in fact, still
growing, with the addition of paycheck
loans increasing profitability margins over
simple short-term loans. Cash
America is sure to continue growth, building new stores and entering
new markets with their paycheck loans services.
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