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Don’t Get a Pawn Loan When You Can Get an Affordable Credit Card

Pawn loans may be easy to get, but they should be a last resort. Find out how Pesto Mastercard® compares to pawn loans.

Compare Pawn Loans to the Pesto Mastercard®

If you’re considering a pawn loan, but you’ve just discovered the Pesto Mastercard®, then you need to know how these options compare.
Discover how you can save money and create a better financial future with Pesto Mastercard® instead of a pawn loan.

Pawn Shop Loans Can Be Expensive

When you need a loan fast, you may not consider the interest rates and fees. The cost of borrowing from a pawn shop is one reason to avoid these loans.

Before you get a pawn loan, ask for the APR

To find out how expensive a pawn loan is, look at the Annual Percentage Rate (APR).

The APR is the rate of interest you will pay if you borrow the money for a year. It’s a number you can compare to other types of loans and credit cards.

Even if you only plan to use the pawn loan for a month, check the APR. The APR is 12 times the monthly interest rate. So, if the pawn loan charges you 25% interest for a month, that loan actually charges 300% APR!

In some states, pawn loan interest rates are very high

Each state sets the maximum APR a pawn shop can charge. Some states set very high APRs for pawn loans. Others set reasonable APRs but allow pawn shops to charge additional fees that make the effective APR very high.

Below, you can see the average cost of a pawn loan in states that allow pawn shops to charge high interest rates or fees. You’ll also see what you can save with Pesto Mastercard®, an affordable alternative to pawn loans.

Cost of a pawn loan and savings with Pesto Mastercard®


Maximum Pawn Loan APR

Borrowing costs on $500 Pawn Loan (Up to 30 Days/1 month)

Borrowing costs for $500 in purchases with a Pesto Mastercard®*




0% interest + $3.33 monthly card fee




0% interest + $3.33 monthly card fee




0% interest + $3.33 monthly card fee

*No interest charges on purchases, provided the cardholder pays the account balance each month.1

Here’s an example of how it works: Pesto Mastercard®

If you borrow $500 from an average Georgia pawnshop, you could pay $125 in interest and fees for the first 30 days ($500 x 25% = $125).

With Pesto Mastercard®, if you borrow $500 and you pay the balance within 30 days, you pay zero interest.

Need to use the credit longer? Pesto Mastercard® will only charge you $12.50 in interest plus $3.33 in credit card fees each month.

Pesto Mastercard® is an affordable alternative to pawn loans.

How Pesto Mastercard® Works

Most pawn shops charge interest even if you pay on time

What if you only need a loan for a few days? Or even a couple of weeks?

With a pawn loan, you could still pay the full month’s interest. That’s because most pawn loans charge you interest from the first day of the loan.

Pawn loans may not give you a “grace period”

A “grace period” is a period of time between the end of the monthly billing cycle and the date payment is due.

With Pesto Mastercard® you’ll have a minimum of 21 days before being charged any interest.

On a pawn loan, there may not be a grace period.

You shouldn’t have to pay interest with no grace period

Why do some pawn shops charge interest from the first day of the loan? 

Pawn shops are often “last resort” lenders for many people. They can charge interest from the first day because many people don’t have a better option when they need a loan or credit.

Now you may have a better option.

With Pesto Mastercard®, if you pay the balance on your card before the due date, you borrow the money with no interest cost. 

Pawn Shop Loans Can Lack Transparency

How much loan can you get for your valuable item if you go to a pawn shop? Are you getting a fair deal? The fact is that the size of a pawn loan offered to you can be unpredictable.

The amount of the pawn loan can depend on who’s working behind the counter that day. You might never know whether the amount offered is fair or whether another customer got a better loan for the same item.

Pesto Mastercard® uses a transparent process that gives customers confidence that they are getting a fair deal. That’s why we created an online calculator. Use the online calculator tool to estimate how much credit we can offer when you use your item as security.

No matter who submits the item, it’s easy to see that all customers with the same items are eligible for the same offers, a fair deal for everyone.

You Can’t Increase Your Credit Score with Pawn Loans

When you use pawn loans, you can get caught in a vicious cycle of paying too much to borrow money.

Most people use pawn loans when they can’t get approved for lower interest lines of credit or credit cards. To get a pawn loan, you may not need a credit history or a good credit score. But there’s a catch.

Pawn loans don’t count towards your credit history

Pawn loans are not reported to the credit bureaus that track your credit history and provide credit scores to anyone who checks your credit report.

So, even if you consistently pay your pawn loans on time, that excellent payment performance doesn’t impact your credit score. 

Why does this matter? 

If you need to rent an apartment, finance a car, or borrow money for unexpected expenses using a line of credit, your credit score can help you get approved.

If you have future credit needs, you are more likely to qualify for lower interest rates if you have a higher credit score. Over time, you can save a lot of money on interest just by having a better credit score.

However, if you only use pawn loans, you miss the opportunity to improve your credit score.

Pawn loans can limit your financial future

Pawn loans may provide immediate cash, but they may not help improve your financial future.

You might think, “Great, but I don’t think I qualify for a bank loan or credit card. How can I get money for expenses and build my credit history?”

Pesto Mastercard® can help you do both.

With Pesto Mastercard®, you can get credit without an excellent credit history. Plus, you can improve your credit history with on-time and regular payments that you make towards your Pesto Mastercard®. 

That’s how Pesto Mastercard® can help improve your financial future.

Summary: How Pawn Loans Stack Up Against Pesto Mastercard®

Now you know how pawn loans compare to Pesto Mastercard®. Both are secured with valuable items, like jewelry, but the similarities end there. 

Here’s how the two financial options compare side-by-side:

Pawn Loan

Pesto Mastercard®

APR (interest rate)

Up to 300%

29.99% (variable)

Interest and fees applied


0% interest for 21 days, $3.33/month in card fees 1,2

Online credit calculator


Opportunity to boost credit score


*No interest charges on purchases, provided the cardholder pays the account balance each month.1

If you’re ready to try the better alternative to pawn loans, calculate the credit you can get and apply now.

Get Pesto Mastercard®
Get Pesto Mastercard®