Throughout history, pawnbrokers have been helping people. The Bible offers references to pawnbroking, and 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. The same chapter also says: "Thou shalt not go into his house to fetch the pledge. Thou shalt stand abroad and the man to whom thou dost lend shall bring the pledge…unto thee." Interestingly, often the debtor's children could be used as a pledge (2 Kings,4:1-7). Also in Deuteronomy 23:21 the people were told not to take interest from their own countrymen - only from foreigners.
The moneychanger's of Jesus' time served two purposes. First they exchanged Antiochian Tetradrachms for the local currency (shekels), exacting a fee between 4% and 8% for their services. Second, they functioned as bankers and lenders. In the well-known Gospel story, Jesus overturned their tables because he didn't feel the gates of the Temple were the right place to be conducting that business. In fact, such moneychangers set up shop there as a service, to deal with people who came to pay their half-shekel Temple tax. The rabbis insisted it be paid in silver didrachms of Tyre, which nobody carried. According to ancient Mesopotamian law, the rates of interest charged - even in those days - were 20% for silver, and 33% for grain.
Pawnbroking existed in the Ancient Greek and Roman Empires. Most contemporary Western law on the subject is derived from the Roman jurisprudence. As the empire spread its culture, pawnbroking went with it. Likewise, in the Far East, the business model existed in China 3000 years ago no different than today, through the ages strictly regulated by Imperial or other authorities.
In spite of early Roman Catholic Church prohibitions against charging interest on loans, there is some evidence that the Franciscans were permitted to begin the practice as an aid to the poor.Pawnbrokering arrived in England with William the Conqueror, but was known by the Italian name, Lombard. In 1338, Edward III pawned his jewels to raise money for his war with France. 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 1603 an Act against Brokerswas passed and remained on the statute-book until 1872. It was aimed at the many counterfeit brokers in London. This type of broker was evidently regarded as a fence. It is rumored that Queen Isabella of Spain pawned her jewelry to finance Christopher Columbus's first voyage to the New World.
Crusaders, predominantly in France, brokered their land holdings to monasteries and diocese for funds to supply, outfit, and transport their armies to the Holy Land. Instead of outright repayment, the Church reaped a certain amount of crop returns for a certain amount of seasons, which could additionally be re-exchanged in a type of equity.
A pawnbroker can also be a charity. In 1450, Barnaba Manassei, a Franciscan monk, began the Monte di Pietà movement in Perugia, Italy. It provided financial assistance in the form of no-interest loans secured with pawned items. Instead of interest, the Monte di Pietà urged borrowers to make donations to the Church. It spread through Italy, then to other parts of Europe. The first Monte de Piedad organization in Spain was founded in Madrid, and from there the idea was transferred to New Spain by Pedro Romero de Terreros, the Count of Santa Maria de Regla and Knight of Calatrava. The Nacional Monte de Piedad is a charitable institution and pawn shop whose main office is located just off the Zocalo, or main plaza of Mexico City. It was established between 1774 and 1777 by Pedro Romero de Terreros as part of a movement to provide interest-free or low-interest loans to the poor. It was recognized as a national charity in 1927 by the Mexican government. Pawning has long been a source of capital for people in times of need, as well as a means of financing business ventures.
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 the early centuries, the principle assets people had were their clothes and borrowed money by pawning their clothing.