Origins of Pawnbroking

The origins of pawnbroking can be traced back over 3,000 years to the Chinese and it is pawnbroking we have to thank for the discovery of the Americas - Christopher Columbus' voyage was funded largely by the proceeds from pawning Queen Isabella of Spain's jewels! The industry as we know it today, however, can be traced back to fifteenth century Italy when the noble Medici family was a dominant financial power.

When the family was split in two, one half of the family became bankers and the other, pawnbrokers. The pawnbroking side of the family took with it half of the family crest, which incorporated the now instantly recognisable sign of the pawnbroker, the famous three gold balls. It should come as no surprise that the origins of banking and pawnbroking are so closely entwined - pawnbroking is, after all, simply another form of banking.

In Britain in the latter stages of the nineteenth century and early twentieth century there were nearly as many pawnbrokers as public houses.

Pawnbrokers Today

The pawnbroker is now unrecognisable from his traditional, preconceived image.

The recent upsurge in the industry's fortunes came during the 1980's credit boom and has continued through to today with customers now preferring this convenient form of borrowing - customers that many banks turned their backs on during the hardships brought on by recession.

A pawnbroker today is heavily regulated and operates with modern professional systems and to customer service levels that match any other service based sector in the economy.  If people have a poor image of pawnbrokers today it is because they simply do not know how pawnbroking works in today's 21st century marketplace.

Today's pawnbroking customers range across every part of society. Certainly there are ordinary people, who may wish to borrow a small sum of money for a short period of time - like an overdraft, but there are also business leaders, celebrities and royalty who may pawn millions of pounds worth of antiques or jewellery.

Pawnbroking customers pledge property that they own and consider the loan simply turning their goods temporarily back into cash. In other words, customers feel they are simply, in effect, borrowing from themselves. No fuss, no favours, no extending or creating unsecured credit with the threat of negative credit ratings or 'blacklisting' if the loan is not repaid. Fully secured, straightforward and transparent credit in minutes. No wonder so many customers and regulatory bodies see pawnbroking as 'just another way of borrowing money'.

"Using a pawnbroker...just another way of borrowing money"  Office of Fair Trading

Edited extracts courtesy of the NPA (National Pawnbrokers Association)