If you’ve looked at the pawn shops in your town and thought to yourself that they always been around, you’re more correct than you know. Pawn brokerage – the act of making a loan with items as collateral – has been around for a long time. It’s history traces the history of human commerce. It’s a fascinating story.

The Ancient World

Many economic concepts that we think of as belonging primarily to the modern world have their roots in ancient cultures. As far back as 3000 years ago, the ancient Chinese were using pawn brokerage as part of their commerce. It’s unknown if the practice spread from Ancient China to other parts of the world, but we do know from Roman writings that Ancient Greece had used this practice as well. The Romans also used pawn brokerage (the word Pawn is derived from the Roman word “Patinum”) and the Romans codified practices still used in the industry today.

Of course, the earliest pawn brokers didn’t operate in shops like they do today. Most were individuals who provided short-term loans to peasants, with everyday clothing being some of the most pawned items (as these were most valuable things early peasants possessed). Various merchants would utilize pawn brokerage as a way to start up their shops or fund ships for trade.

Medieval Europe

Pawn brokerage thrived largely unregulated in Medieval Europe despite the Catholic Church having rules against Christians lending to each other with interest. During this time, most pawn brokers were Jewish. Even though Mosaic Law prohibited Jews from interest lending with each other, they could lend with interest to non-Jews.

Pawning in the Medieval Europe was not just something for the peasantry and merchants. Nobility also engaged in pawning valuable items. King Edward III pawned his jewels to fund his war against France in the 14^th Century. Queen Isabella of Spain pawned her jewelry in order to fund the voyage of Christopher Columbus.

The Dawn of Regulations

Several factors, political and economic, combined to lead to regulation of pawn brokerage beginning around the 18^th century. During this time, pawn brokering fell under suspicion as many suspected thieves of using pawn brokers to sell stolen goods. In addition, interests rates in the preceding centuries fluctuated greatly, especially as political entities moved from borrowing from pawn brokers to creating their own state-control brokerages.

Some of the most influential regulations of pawn brokerage come from England and Ireland in the 19^th Century. The Pawnbrokers Act of 1800 came as a relief to many pawn brokers, who had seen interest rates cut severely in England prior to the passage of the Act. Unfortunately, numerous unpopular changes would occur to the act, leading up to the Pawnbrokers Act of 1872, which helped to stabilize the industry and lead to its growth.

Modern Pawn

In the United States, pawn brokers are among some of the most heavily regulated industries. From background checks for brokers to ID requirements for those bringing in items, the regulations help protect both pawn businesses and consumers from fraud and abuse.

Where Does the Pawn Broker Symbol Come From?

You’ve likely noticed that most pawn shops feature a variation of three gold balls hanging from a bar. It has been a common symbol for pawn brokers since about the 18^th century. No one agrees on the origins of the symbol. Some say it comes from the Medici family while others claim it originates from the Lombards, both of whom were powerful families involved in early pawn brokerage.

Another legend of the symbol attributes it to Saint Nicholas of Myra, who is the patron saint of pawnbrokers. According to the legend of Saint Nicholas – yes, the same Saint Nicholas the legend of Santa Claus derives from – he gave a bag of gold to three poor girls to save them from destitution, which is symbolized by the three hanging balls.

Your Pawn Shop in Philadelphia

Whether you need extra cash or want to find savings on jewelry and electronics, Cash Express is here serving the Philadelphia area. Stop by or contact us today.