Pawning System

I was inspired by this (very bad) idea to come up with some actually plausible methods of money exchange. I tried to come up with an aggregated direct lending system like a real life bank but there would too many loop holes and exploits that would allow people to steal money from it.

I came up with another idea instead: pawning.

Much like real life pawning, it would be a collateral loan facilitated through something similar to the trade market. Players would be able to post item offers for loans on a central market page and other players would be able to choose to provide emeralds for those loans.

First a player must choose an item that they want to pawn and create their listing, as well as pay a refundable up front fee. The person providing the item chooses all of the terms of the loan agreement. The item used as collateral (of course), how many emeralds they are requesting to borrow, how many days they have to pay back the loan, and the amount of interest they are paying (chosen as a static number, not a percent).

The up front fee would be a very small fixed percentage of the number of emeralds requested for the loan, such as 1-2%. This fee is consumed when another player agrees to loan the requested emeralds, and can only be refunded if the listing expires unfilled.

When another player does agree to the offer, they immediately provide the requested number of emeralds. During the duration of the loan, the item is held inside the system, with no player able to access it. Then after the allotted amount of time, or earlier if the borrower decides, the borrower must pay back the original amount of the loan plus the interest they chose. Repayment of the loans is mandatory, and emeralds can be extracted from the debtor's bank. In the event that there are not enough emeralds in the players bank to cover the loan when it expires, no partial payment occurs. Zero emeralds are paid back, but instead the lender now owns the pawned item. A second, much higher tax is paid on the interest payment, such as 25%.

Example:

I have a mythic valued at 5,000,000 emeralds. I decide to pawn it because I definitely don't want to sell it, but it's just sitting in my bank and I want to use the emeralds to do mythic trades. I decide to pawn it for 3,000,000 emeralds, and that I will pay back the loan after 3 weeks, and I decide that I will pay 100,000 emeralds as interest. In order to list my item to be pawned, I must first pay the 1% fee of 30,000 emeralds. When somebody decides to loan me the 3,000,000 emeralds, I can immediately retrieve the full amount and use it however I please. After 3 weeks, I owe back 3,100,000 emeralds. If I am unable to pay back the full 3,100,000 emeralds, the person who loaned me the 3,000,000 emeralds will now own my mythic. If I decide that I want my item back early, I can always choose to close the deal early by paying the 3,100,000 emeralds.
A 25% tax is levied on the amount of interest I pay, so the lender will only receive 3,075,000 emeralds back.

Honestly I just posted this because I think its kind of interesting. It only really seems useful to facilitate mythic trading, or other items worth at least half a stack.

 

I feel like this is kind like my Interest Banking where it would just make the bank too complicated (yes Saya I admitted it), but otherwise you put a lot of thought into this idea and I respect that!

 

This would be super neat, both as a way to get some quick cash as a loan, and as a possible way to get a cheap mythic if someone misses their payment. My only worry would be that it benefits the wealthy more, as they'll typically get more interest out of it, but I don't think that would be too big of an issue since they can already do this by buying and selling mythics, this just lets people with less money get involved.

 

I like the idea and the thought put into it. It's nothing like interest (which is suggested every year or so), and unlike it, it won't ruin the economy. It has a lot of room for expansion and creativity as well.

The lender does have no risk, but are "locked out" of their emeralds, which is an interesting trade to think about.

Overall the best "loan" idea I've seen in a while, but it also doesn't seem worth the resources to develop.

 

Bump10char

 

isn't "bump10char" against the forum rules? lol