What is a Pawn Shop?
A pawn shop is a shop that offers consumers loans, utilizing their valuables as collateral. The history on Pawn shops remains the same, they offer loans to consumers as long as they have access to those consumers’ valuable possessions. Valuable possessions that consumers often put up for a loan at a pawn shop include jewelry, electronics, and bicycles. We will discuss these matters in more detail below.
How Did Pawn Shops First Start?
The first pawn shops ever invented were in ancient China. Much later, however, pawn shops arose in ancient Greece and ancient Rome as well. These pawn shop loans were used primarily for helping shop owners to get their business first starting off the ground.
In ancient China, pawn loans were given to peasants who were struggling to survive. Pawn shops saw a decrease in activity during the middle ages. This was because the Catholic Church was enforcing rules to decrease the distribution of loans to the poor. By the 14th and 15th, pawn shop business was back to normal.
During ancient times, the most successful families made much of their living by giving out loans at high-interest rates. In this way, society’s structure was similar as it is today. Only today, there are many more different entities that facilitate loan brokerage. Now, in addition to pawn shops, there are also banks and private lenders.
Pawning in the 1800s and Contemporary
During the 18th century, many of the first pawn shops made the shift to being charitable organizations. They dealt out loans at low interest to the consumer in order to help lift people out of poverty. In England in 1872, The Pawnbrokers Act of 1872 was passed.
This act made it so that pawnbrokers were legally protected to offer fast cash should they mistakenly purchase goods that were actually stolen from the original owner. There was a rise in this occurrence during the 19th century when people were struggling to make ends meet. This legislation protected the pawnbrokers who were essentially innocent in the process.
During the Great Depression, the industry of Pawn brokerage once again saw a great rise. As banks struggled to be able to hand out cash, pawnbrokers were able to provide the currency. This meant serious business success for pawnbrokers during some of the most difficult times for humanity in terms of finances. They were able to give out fast cash to those struggling to make ends meet.
An Overall Rich History
Pawn shops have an overall rich and fascinating history. Rooted in ancient China, these types of shops have served to benefit the public well-being for many centuries. They have always been a way of generating positive business while assisting those who are struggling financially to lift themselves out of poverty. Pawn shops serve a great social purpose and it is for this reason, unarguably that they have made such great successful strides throughout many centuries.