royal patent. The statistics which have been preserved relative
to the business done in the first few years of its existence
show that in the twelve years between 1777 and the Revolution,
the average value of the pledges was 42 francs 50 centimes,
which is double the present average. The interest charged
was 10% per annum, and large profits were made upon the
sixteen million livres that were lent every year. The National
Assembly, in an evil moment, destroyed the monopoly of the
mont de piété, but it struggled on until 1795, when the competition
of the money-lenders compelled it to close its doors. So
great, however, were the extortions of the usurers that the people
began to clamour for its reopening, and in July 1797 it recommenced
business with a fund of £20,000 found by five private
capitalists. At first it charged interest at the rate of 36% per
annum, which was gradually reduced, the gradations being 30,
24, 18, 15, and finally 12% in 1804. In 1806 it fell to 9%,
and in 1887 to 7%. In 1806 Napoleon I. re-established its
monopoly, while Napoleon III., as prince-president, regulated
it by new laws that are still in force. In Paris the pledge-shop
is, in effect, a department of the administration; in the French
provinces it is a municipal monopoly; and this remark holds
good, with modifications, for most parts of the continent of
Europe.
In England the pawnbroker, like so many other distinguished personages, “came in with the Conqueror.” From that time, indeed, to the famous legislation of Edward I., the Jew money-lender was the only pawnbroker. Yet, despite the valuable services which the class rendered, not infrequently to the Crown itself, the usurer was treated withGreat Britain. studied cruelty—Sir Walter Scott’s Isaac of York was no mere creation of fiction. These barbarities, by diminishing the number of Jews in the country, had, long before Edward’s decree of banishment, begun to make it worth the while of the Lombard merchants to settle in England. 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 the symbol which these 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. 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. harried them a good deal. In the very first year of James I. “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 mere receiver of stolen goods, for the act provided that “no sale or pawn of any stolen jewels, plate or other goods to any pawnbroker in London, Westminster or Southwark shall alter the property therein,” and that “pawnbrokers refusing to produce goods to their owner from whom stolen shall forfeit double the value.”
In the time of Charles I. there was another act which made it quite clear that the pawnbroker was not deemed to be a very respectable or trustworthy person. Nevertheless a plan was mooted for setting that king up in the business. The Civil War was approaching and supplies were badly needed, when a too ingenious Royalist proposed the establishment of a state “pawn-house.” The preamble of the scheme recited how “the intolerable injuries done to the poore subjects by brokers and usurers that take 30, 40, 50, 60, and more in the hundredth, may be remedied and redressed, the poor thereby greatly relieved and eased, and His Majestie much benefited.” That the king would have been “much benefited” is obvious, since he was to enjoy two-thirds of the profits, while the working capital of £100,000 was to be found by the city of London. The reform of what Shakespeare calls “broking pawn” was in the air at that time, although nothing ever came of it, and in the early days of the commonwealth it was proposed to establish a kind of mont de piété. The idea was emphasized in a pamphlet of 1651 entitled Observations manifesting the Conveniency and Commodity of Mount Pieteyes, or Public Bancks for Relief of the Poor or Others in Distress, upon Pawns. No doubt many a ruined cavalier would have been glad enough of some such means of raising money, but this radical change in the principles of English pawnbroking was never brought about. It is said that the Bank of England, under its charter, has power to establish pawnshops; and we learn from A Short History of the Bank of England, published in its very early days, that it was the intention of the directors, “for the ease of the poor,” to institute “a Lombard” “for small pawns at a penny a pound interest per month.”
Throughout both the 17th and 18th centuries the general suspicion of the pawnbroker appears to have been only too well founded. It would appear from the references Fielding makes to the subject in Amelia, which was written when George II. was on the throne, that, taken in the mass, he was not a very scrupulous tradesman. Down to about that time it had been customary for publicans to lend money on pledges that their customers might have the means of drinking, but the practice was at last stopped by act of parliament. Nor was respect for the honesty of the business increased by the attempt of “The Charitable Corporation” to conduct pawnbroking on a large scale. Established by charter in 1707, “this nefarious corporation,” as Smollett called it, was a swindle on a large scale. The directors gambled wildly with the shareholders’ money, and in the end the common council of the city of London petitioned parliament for the dissolution of this dishonest concern, on the ground that “the corporation, by affording an easy method of raising money upon valuables, furnishes the thief and pickpocket with a better opportunity of selling their stolen goods, and enables an intending bankrupt to dispose of the goods he buys on credit for ready money, to the defrauding of his creditors.” When the concern collapsed in 1731 its cashier was Mr George Robinson, M.P. for Marlow. In company with another principal official he disappeared, less than £30,000 being left of a capital which had once been twenty times as much.
The pawnbroker’s licence dates from 1785, the duty being fixed at £10 in London and £5 in the country; and at the same time the interest chargeable was settled at 12% per month, the duration of loans being confined to one year. Five years later the interest on advances over £2 and under £10 was raised to 15%. The modernModern Regulations in England history of legislation affecting pawnbroking begins, however, in 1800, when the act of 39 & 40 Geo. III. c. 99 (1800) was passed, in great measure by the influence of Lord Eldon, who never made any secret of the fact that, when he was a young barrister without briefs, he had often been indebted to the timely aid of the pawnshop. The pawnbrokers were grateful, and for many years after Lord Eldon’s death they continued to drink his health at their trade dinners. The measure increased the rate of interest to a halfpenny per half-crown per month, or fourpence in the pound per mensem—that is to say, 20% per annum. Loans were to be granted for a year, although pledges might be redeemed up to fifteen months, and the first week of the second month was not to count for interest. The act worked well, on the whole, for three-quarters of a century, but it was thrice found necessary to amend it. Thus in 1815 the licence duties were raised to £15 and £7, 10s. for London and the country respectively; another act of 1840 abolished the reward to the “common informer” for reporting illegal rates of interest; while in 1860 the pawnbroker was empowered to charge a halfpenny for the pawn-ticket when the loan was under five shillings. As time went on, however, the main provisions of the act of 1800 were found to be very irksome, and the Pawnbrokers’ National Association and the Pawnbrokers’ Defence Association worked hard to obtain a liberal revision of the law. It was argued that the usury laws had been abolished for the whole of the community with the
