The provision for bad debts of pawnbroker loans refers to the provision for bad debts drawn according to the ratio of pledged loans, mortgage loans and the year-end balance of loans 1%.

When the balance of bad debt reserve reaches 10% of the sum of pledged loans, mortgage loans and absolute loans, it will not be withdrawn. Due to the decline in the loan balance at the end of the year, when the balance of bad debt provision for loans has exceeded 65,438+00% of the loan balance at the end of the year, the excess is written off in red.