|Placing an article in pawn was a way of raising a short term loan. The
pawnbroker lent quite a bit less than the market value of the article or
goods, which were kept by the pawnbroker as security for the loan. Once
the amount of the loan had been agreed, the pawnbroker would hand the
money and a pawn ticket to the customer, and put the goods in store.
Various charges were made for the transaction.
On loans of 10 shillings
or under, the pawnticket would cost one halfpenny and the interest would
be one halpenny per two shilling loan, per month. After the first month,
interest could be charged at half month rates. On loans above 10
shillings, but less than 40 shillings, the pawnticket cost one penny.
The maximum that could be loaned without a money lender's license was
£10. To regain the goods, the customer had to pay back the amount
borrowed, plus the interest on the loan.
All pledges were kept for one
year and one week from the date of the transaction. After this time the
pawnbroker was allowed to sell the goods in order to recover the cost of
the loan. If the loan was under 10 shillings, the pawnbroker could
dispose of the goods in any manner, but if the loan was for 10 shillings
or more, the goods had to be auctioned by firms of specialist
auctioneers, who dealt with this kind of merchandise.
Pawnbroking is an old established industry. In 1546 several Acts of
Parliament were passed to regulate the trade, and the rate of interest
charged on loans was set at 10 percent. In the 18th century, anyone
wishing to trade as a pawnbroker, had to purchase a license, which cost
£7.10s, except in London, where it was £15. The Pawnbrokers Association
was formed in the 1870's as a trade protection organisation, with
branches in every major city.
The early 1920's were a boom time for
pawnbrokers, because of the depression. More people needed their
services, but at the same time fewer people could redeem their pledges.
As the depression deepened there was less demand for the second hand
goods, that most pawnbrokers sold, and relied upon to boost their
income. The industry started a slow decline and by the second world war,
the better educated population began to use banks and borrowed money
from other sources. Most of the pawnbrokers soon disappeared, only a few
Without the pawnshops people couldn't have carried on.
Every Monday was pawn shop day, all around us, even our next door
neighbours. Lots of people were in bad circumstances, five, six, eight
or ten kids, you see. There was nothing to do at night. As soon as the
candle had burnt out, nothing to do but make love. They used to go on
Mondays, taking a clean sheet off the bed and fill it full of stuff.
Shoes and things like that would be put into the sheet and taken to the
pawnshop, in a big bundle on their shoulder. They would pawn their
husband's best suit, shoes or shirt, which was only used on Sundays.