There’s a good chance that you have set foot in at least one pawn shop in Norwich, CT or in another town you’ve lived in or visited. A majority of pawn shops are in strip malls, but larger shops can be standalone businesses. Have you seen billboards advertising pawn shops? You may have noticed most of them offering to pay cash for gold and other precious metals. The thing about pawn shops is that they buy and sell things and give loans on so much more than just gold.
Want to learn more? Here’s a brief history of pawn shops and pawn brokers.
Early Chinese pawning
Although pawn broking is not the oldest recorded profession in history, it is worth talking about, especially since it can be traced all over the world throughout time. Let’s start with China. Back in 206 BC, during the Western Han Dynasty, Chinese records indicate that securing loans on property was common practice. What stands out the most about these Chinese pawn shops is the length of time they gave for loans to be repaid and the average interest rate. A borrower could take up to three years to pay off their loan, with an interest rate as low as 3 percent!
Europe in the Middle Ages
The popularity of European pawn broking increased during the Middle Ages, especially in England, where the practice was introduced during the Norman Conquest. Another European pawn broking hotspot at this time was the Lombardy region of northern Italy. Pawning became strongly associated with the region of Lombardy throughout European countries that the term “Lombard” soon became interchangeable with “pawn shop,” and the phrase “Lombard banking” transformed into a term for “pawn broking.”
The Catholic Church
King Edward III may have pawned his jewels in 1338 to raise funds for the English military, at the dawn of the Hundred Years War, but it wasn’t just nobles pawning their possessions to aid an effort. Many people and groups turned to pawn brokers to help the poor. One of England’s biggest pawn broking operations, the Charitable Corporation, took place in the 18th century when the Catholic Church gave permission to pawn shop owners to operate, but on the condition that they agreed to lend money to the poor at reasonable interest rates. However, 25 years later, the corporation went bankrupt due to internal fraud and embezzlement.
The spread of pawn broking throughout Europe was not without some snags. In the 17th century, some pawn brokers gained reputations as shops for stolen merchandise, which made pawn shops look bad. As a result, in 1785 England began closely monitoring and regulating the pawn broking industry.
Making a profit
A pawn shop allows customers to bring in valuables to use as collateral to obtain a fast, on-the-spot cash loan. The borrower has a certain amount of time to reclaim the item after the loan has been paid in full and with interest. Terms vary from shop to shop. Otherwise, it becomes property of the pawnbroker and sold in their shop.
At AZ Pawn & Guns, we offer a wide selection of quality used items at reasonable prices. Visit our pawn shop in Norwich, CT today!
Categorised in: Pawn Shop
This post was written by Writer