Definition of a Pawnbroker: a person/business who lends money in exchange for objects used as collateral, which would be returned after an agreed amount is paid back.
Pawnbroking has come to be known as the world’s second-oldest profession. Chinese records show that the practice of securing loans on property date back all the way to the dawn of the Western Han Dynasty in 206 BC. Later pawn shops were established, owned, and operated by Buddhist monasteries.
Meanwhile, European pawnbroking began to flourish during the beginning to late Middle Ages. Pawn brokerage arrived in England during William the Conqueror’s era, while another popular region for pawnbroking was the Lombardy region of northern Italy. In fact, pawnbroking became so strongly identified with Lombardy throughout Europe that the term “Lombard” gradually became synonymous with “pawn shop” and “Lombard banking” was a widespread term for pawnbroking.
Anyone who turns to a pawnbroker to get some quick cash is in good historical company. Pope Leo X, a notoriously free spender, once had to pawn his own palace furniture and silver to cover his luxurious lifestyle. (It’s no surprise, then, that Leo X was the head of the Church when it gave the practice of pawnbroking the official go-ahead in 1515.) In 1338 King Edward III pawned his jewels to raise capital for the English military at the start of what would become the Hundred Years’ War.
Fast-forward to 1785, when the Pawnbroker’s license law was passed in England and a series of amendments and provisions were set in place to safeguard both the interests of the borrower and the business.