Pawnbroking Thrives Again in Britain
If you’re a Briton short of a few pounds to pay the gas bill or a few thousand to fund your latest stock purchase and the bank manager won’t listen, chances are that a pawnbroker will.
Britons with something of value to hock--it could be a fishing trawler or even a stuffed fish--are turning in growing numbers to pawnbrokers for a quick, no-questions-asked loan as the profession sheds its seedy Victorian image of penury and usury.
And, with Britain’s economy in deep recession after a boom in the 1980s, pawnbrokers say they are in one sector that isn’t feeling the pinch.
“It’s a growing business all the time,” said Stephen Squire, managing director of the London Pledge Co., one of the new recruits to the list of pawnbrokers to set up shop.
“The only effect the recession is having on us perhaps is that a few more items are not being redeemed than normal.”
Squire’s company, in the capital’s northern Angel district, differs from most pawnbrokers, which tend to accept only jewelry or precious metals. It will lend money on almost any item the value of which it can ascertain.
“We draw the line at fur coats,” said Squire, 27. “It’s not that we wouldn’t buy them but we can’t sell them.”
He says he has lent $183,000 on a Ferrari Testarossa car and his current stock of ritzy motor vehicles includes a gleaming Harley Davison motorbike. He has also had two London buses and a helicopter.
Customers--about 300 a week--range from housewives pawning gold rings to make ends meet to fresh-faced yuppie businessmen needing quick cash to finance a property deal, pay off stock market losses or buy in to the latest stock offer.
“Lots of people get in a tight spot and you can’t take your car to the bank or your Rolex (watch),” said Squire.
“With the right item you can borrow 100,000 pounds from us in a matter of hours. Go to a bank and it’s a board meeting and they want your left lung too,” he said at his office, graced by a mahogany grandfather clock pawned until June, 1992.
Golf clubs, fishing rods--even a stuffed fish in a glass case--musical instruments, cameras, watches, jewelry and artworks are among items at Squire’s premises, a former bank equipped with security cameras, alarms and glass screens.
Pawnbrokers lend money on items of value and charge interest on the loan. The item is held as security and becomes the pawnbroker’s property if the loan is not repaid within six months, but profits from the sale must be given to the customer.
Interest rates, currently 50% to 60% on an annualized basis, are more than twice those of banks but pawnbrokers say short-term loans on small sums can work out cheap.
Pawnbroking, symbolized by the sign of three golden balls outside shops, was known to have existed in China as long as 3,000 years ago.
In Britain, it used to be associated with working-class misery--pawning pots, pans and bed linen to buy food--or rakish aristocrats selling the family heirlooms.
Charles Dickens, chronicler of the worst of 19th-Century England, called pawnbrokers’ shops “receptacles for misery and distress.” A derogatory jibe to describe an unprincipled character is that “he would even pawn his own grandmother.”
Most shops faded out of existence after World War II with increased affluence and state social security handouts, but the industry staged a comeback in the mid-1980s at the height of Britain’s credit-driven “loads of money” boom.
The National Assn. of Pawnbrokers claims 200 members, many with several shops, against 40 or so in the late 1970s.
“The type of customer has changed completely. They are the middle or upper classes rather than the lower classes. They could be seeking short-term cash to pay private school fees or a skiing holiday,” said the association’s Harvey Bell-Roberts.
Some 80% of items pawned are redeemed, said Bell-Roberts. And though pawnbrokers’ discretion means that they are never to ask what customers want money for, some visitors are only too ready to tell.
“One woman who came in here handed over 6,000 pounds ($11,000) worth of jewelry and got in a cab to the gambling casino,” Squire said.
