The possibility of exchanging valuable items for money appeared a long time ago. People have used this service since ancient times. Later, it helped many influential families in the European banking industry to gain some dominance. In fact, such services were extremely popular at any time. After all, life is unpredictable and there will always be both a customer and a person who wants to get something valuable. The history of pawn shop development in London is exemplary. What secrets does it hide and what contributed to its development? Learn more at london1.one.
The first pawn shops in London and their activity
In general, the operation scheme of pawn shops has always been and remains as simple as possible. A person brings their possessions and receives money for it. At a pre-specified time, the client must return the funds (additionally paying interest). If it doesn’t happen, the item can be put up for sale. The simplicity of such principles was clear to everyone. The most important thing was that almost anything could be pawned. In England, and London in particular, this phenomenon goes back to ancient times. However, it reached insane popularity at the beginning of the 12th century. It is related to the appearance of Jews on the territory of the country. Their houses became the first pawn shops. However, the country was completely subordinated to religion back then and Christianity condemned such a thing. All of that against the background of social, political and religious differences led to conflicts between creditors and debtors. A vivid example of the terrible consequences was the event that happened in London in 1189 when a mob of angry people killed many Jews. In 1275, King Edward I passed a statute prohibiting the charging of high interest. The passing of the law also led to the expulsion of Jews from the country. Although all those events looked terrible, they couldn’t stop the existence of pawn shops and an opportunity to earn easy money in London.
Further history
The image of a London pawnbroker changed significantly in the 18th century. First of all, clear rules were introduced regarding the activities of such places, which is evidenced by the adoption of the Pawnbrokers Act of 1785. The main feature of the law was the granting of a licence to pawnbrokers under the condition of their compliance with certain rules. In London, the licence fee was £10, which was quite a big sum at the time. Loan terms were limited to one year and the interest rate was 0.5%. The next changes took place in 1800. In that year, the country introduced a new law, which had a positive effect on the further development of pawn shops. Although the licence fee was increased (up to £15), pawnbrokers could charge a much higher percentage (up to 1.5%). In addition, £15 wasn’t such a large sum as it was considered before. During the entire period of its existence, the law was periodically changed, but it didn’t affect the general condition of pawn shops. In 1872, a new law was adopted. At that time, the main attention was paid to the protection of consumer rights. In particular, it was illegal to grant a loan to a person who was intoxicated or under 12 years of age. According to the new rules, the owner of a pawn shop building had to identify it using a sign. The Industrial Revolution also contributed to the flourishing of this sphere. The only thing that stood in the way of the further frantic development of pawn shops was the introduction of modern banking services. They provide loans of various forms. Thus, over time, people started preferring banks. However, the love for exquisite watches, jewellery and other objects with a rich history has always attracted people. Walking around London, you can still find glittering shop windows.