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Fun Facts

Pawnbroking Background Information

For thousands of years, people all over the world have from time to time found themselves with one problem in common—the need for fast cash. And for almost as long, there’s been one easy way to solve it: To “pawn” personal items of value for a cash loan. Throughout history, pawnbrokers have provided monetary loans in exchange for valuable items. These items are then held by the pawnbroker for a contractual period of time during which the owner of the item can repay the cash loan, plus an amount of interest, to reclaim their goods. If they are unable to come up with the money to buy the item back, the broker has the right to sell the item to another buyer. In the United States today, more than 12,000 pawn shops operate nationwide, their shelves filled with an eclectic array of items from the ordinary to the unbelievable. Each has its own unique story and past.

More than 3,000 years ago, pawn shops first emerged in Ancient China as a method of granting short-term credit to peasants. Some pawnbrokers operated independently, but over time most of these businesses were run through pawn shops. Pawnbroking thrived in ancient Greece and Rome, giving merchants a way to get small shops off the ground.

The pawn shop industry has been criticized for preying upon the poor with inflated interest rates and low-balling the value of goods in order to turn a profit. But organizations such as the National Pawnbrokers Association, established in 1988, contend that their industry offers a viable solution for those in need of cash. Pawn shops are required to uphold clear regulations about the terms of the pawn contract and the amount of interest on the cash loans. Each pawned item is also registered to prevent the sale of stolen items.

Pawn shops are repositories of history, holding antiques, jewelry, furniture and other items that have been passed from generation to generation. Their owners may genuinely know their source, or offer tales of where they believe items came from and how much they are worth. Of course, pawn brokers do their own assessment of each item, estimating its age, authenticity and value on the open market. Along the way, they develop a unique set of skills, sniffing out the authentic from the fake, the valuable from the worthless and the art of driving a hard bargain.

Historical Facts

  • The Nursery Rhyme "Pop Goes The Weasel" refers to pawning. A weasel is a shoemaker's tool and to "pop" is to pawn. Hence: "That's the way the money goes... Pop goes the weasel."
  • Queen Isabella of Spain pawned the crown jewels to finance Columbus' voyage to America.
  • The word pawn originates from the Latin word "patinum" which means cloth or clothing. The French word "pan" refers to a skirt or blouse. In early centuries, all people had was the clothes they wore, and they borrowed money against them.
  • One of the less well-known legends about the origin of the trademark sign was it that it was based on a Roman coin used in Israel – from A.D.68 onwards, after a revolt against the Roman invaders. Called the ‘Silver Shekel’, it featured a picture of three pomegranates, on a common stalk, on one side.
  • The bible offers references to pawning. In Deuteronomy 24:6-13 it states: "No man shall take the nether or the upper millstone to pledge, for he taketh a man's life to pledge". What this means is: you should not take as a pledge anything a man needs to make a living.
  • Did you know that St. Nicholas, better known by a different name today, is actually the patron saint of pawnbrokers and bankers? One of the most famous stories tells that he gave, even before he was ordained, three bags of gold coins to a desperate man, in order that he could save his daughters from poverty. Over time, bankers and pawnbrokers alike would hang three golden balls above the doors of their shops in tribute to him. Saint Nicholas’s legendary kindness caused his transformation, first in Germany, then in France as Father Christmas, before Dutch Protestant settlers in New Amsterdam (New York City) came up with the idea of Santa Claus, which became popular worldwide.