As mankind’s oldest financial institution, pawnbroking carries on a tradition with a rich history. Pawnbroking can be traced back at least 3,000 years to ancient China, and has been found in the earliest written histories of Greek and Roman civilizations.
During the Middle Ages, certain usury laws imposed by the Church prohibited the charging of interest on loans, thus limiting pawnbroking to people who had religious beliefs outside of the Church. Out of economic necessity, and because of problems in the banking system, pawnshops made a resurgence in later years. The House of The Lombards operated pawnshops throughout Europe. They even counted royalty, such as King Edward III of England, among their clientele during the 14th century. The symbols of the Lombards‚Äô operations were the three gold balls that still remain the trademark of pawnshops.
The pawn industry came to America with the first settlers and in the early part of this century pawn broking was regarded as the main source of consumer credit. With the rise of large consumer credit institutions, such as finance corporations, savings and loan associations, and credit unions, the pawn shop is no longer the major source of consumer credit. But the pawn shop still plays a vital role in the area of providing consumer credit.
The pawn industry fills that gap and helps people obtain some quick money when a bank says no.
Pawning has long been a source of capital for people in times of need, as well as a means of financing business ventures. When Christopher Columbus approached Queen Isabella of Spain about securing funds for his voyage, she was prepared to pawn her crown jewels in order to provide him with the necessary finances. Fortunately, the Spanish government agreed to back Columbus, saving the Queen from having to part with her beloved crown.
Many modern day customers of pawn shops include politicians, movie stars, sports figures, and business owners.