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A pawnbroker is a person who offers loans to individuals who use their personal property as collateral. These items are called pledges or pawns. The word pawn is derived from the Latin pignus, for pledge. The place of business of a pawnbroker is called a pawnshop.
A pawnbroker evaluates the value of any possession that is offered as a pledge for a loan. The amount of the loan is a percentage of the item's value, and the pledge is kept by the pawnbroker for the agreed period of the loan. If the money is repaid at any time during this period, along with the fee, the customer receives the pawned item. If the time elapses without repayment nor fee, the pawnbroker is allowed to sell the pledged item to recoup the amount of his loan. As a result, pawnbrokers have a large number of formerly pawned objects offered for sale. Pawnbrokers can also purchase an item outright for cash with no repayment expected; these can be immediately offered for sale. Some situations depending on the item the Pawn Shop may have to hold the item during a check of the item in the Police system. This hold can be anywhere from 21 to 30 days depending on location.
It has been noted that since pawnbrokers often buy goods from strangers with few questions, some unscrupulous pawnbrokers act as fences. They have througout the ages been accused of usury, but this has often been because the (usually poor) people who pawn items are not familiar with the system, or are illiterate and unable to read their contract. Pawnbrokers have claimed that few stolen items end up in pawnshops, especially in some countries where pledgors are required to show government-approved identification when making a loan. It is easier, the pawnbrokers say, for a thief to dispose of their goods through an outlet such as eBay or flea markets where items being sold are not subject to government regulations regarding the acquisition and sale of personal property.
History
- For a longer history, see History of pawnbrokers.
In imperial China the pawnshop was probably as familiar two or three thousand years ago as today, and its conduct is still regulated quite as strictly as in England. The Chinese conditions are decidedly favorable to the borrower. He may, as a rule, take three years to redeem his property, and he cannot be charged a higher rate than 3% per annum, while in England this is 6%-8%. In England the pawnbroker, like so many other distinguished personages, came in with William the Conqueror. In 1338 Edward III pawned his jewels to the Lombards to raise money for his war with France. An equally great king Henry V did much the same in 1415.
The Lombards were not a popular class, and Henry VII Tudor harried them a good deal. In the very first year of James I Stuart an Act against Brokers was passed and remained on the statute-book until Queen Victoria had been thirty-five years on the throne. It was aimed at counterfeit brokers, of whom there were then many in London. This type of broker was evidently regarded as a fence.
The pawnbroker in the United States is, generally speaking, subject to considerable legal restriction, but violations of the laws and ordinances are frequent. Each state has its own regulations.
Symbol
The pawnbroker's symbol shows three balls suspended from a bar. The three ball symbol is attributed to the Medici Family of Florence, Italy, because of its symbolic meaning of Lombard, referring to the Italian province of Lombardy, where pawn shop banking originated under the name of Lombard banking. It is now as well established as anything of the kind can be that the three golden balls, which have for so long been the trade sign of the pawnbroker, were originally the symbol which medieval Lombard merchants hung up in front of their houses, and not, as has often been suggested, the arms of the Medici family. It has, indeed, been conjectured that the golden balls were originally three flat yellow effigies of byzants, or gold coins, laid heraldically upon a sable field, but that they were presently converted into balls the better to attract attention.
Most European towns called the pawn shop the "Lombard". The House of Lombard was a banking family in medieval London, England. According to legend, a Medici employed by Charles the Great slew a giant using three bags of rocks. The three ball symbol became the family crest. Since the Medicis were so successful in the financial, banking, and moneylending industries, other families also adopted the symbol. Throughout the middle ages, coats of arms bore three balls, orbs, plates, discs, coins and more as symbols of monetary success. Pawnbrokers (And their detractors) joke that the three balls mean "Two to one, you won't get your stuff back".
Saint Nicholas is the patron saint of pawnbrokers. The symbol has also been attributed to the story of Nicholas and the three bags of gold.
Pawn shops in Hong Kong
Hong Kong Pawn Shop Logo.jpg|float|right|thumb|300px|A typical Hong Kong pawn shop sign: a bat holding a coin.]]
Pawnbroking is a traditional trade of Thailand and in Hong Kong it follows the Chinese tradition. The counter of the shop is typically higher than a normal person for security. A customer can only hold up his hand to submit belongings and there is a wooden screen between the door and the counter for customers' privacy.
The symbol of a pawn shop in Hong Kong is a bat holding a coin (Cantonese: fuk shu tiu kam chin; in chinese letters: 蝠鼠吊金錢). The bat signifies fortune and the coin signifies benefits.
See also
Sources and external links
Distribution, retailing, and wholesaling | History of banking | Retailers | Retail financial services
"Pawnbroker"