HONG KONG (AFP) - A Hong Kong firm has launched a series of television commercials offering personal loans in exchange for ladies' luxury handbags, a report said Monday.

Yes Lady Finance will pay cash-strapped socialites up to 70 percent of the bag's value with 28 percent annualised interest, the South China Morning Post said.

A Louis Vuitton handbag valued at 2,600 US dollars in the second-hand market would fetch a 1,800 dollar three-month loan, the paper said, adding that owners would lose the bags if they failed to settle the debt on time.

"It is a good fund-raising option for some tai-tais," company co-founder Wallace Tung was quoted as saying, referring to a slang term for the wives of wealthy Hong Kong businessmen. "They may not want to sell their handbags, which may be a gift from husbands and mean a lot to them."

The southern Chinese city has a thriving second-hand luxury bag market.