The History of the Pawn Shop
One of the World's Oldest Ways to Borrow
Long before banks, credit cards, or credit scores, people solved short-term money problems the same way you can today: by leaving something of value as security and getting cash in hand. Pawnbroking is one of the oldest forms of lending in the world, and it shows up in nearly every culture and century.
Ancient Roots in Asia
Some of the earliest known pawnshops were in China more than 1,500 years ago, where Buddhist monasteries lent money to local farmers and families against their goods. Over the centuries, pawnshops became a regular part of Chinese town life and were closely regulated by imperial authorities.
The tradition spread across Asia. In Japan, the word for pawn, shichi, sounds like the word for the number seven, and pawnshops are still called shichiya. In Hong Kong, traditional pawnshops are marked by a sign showing a bat (a symbol of good fortune) holding a coin.
Greece and Rome
The ancient Greeks and Romans lent money against pledged property too. Roman law set rules for how pledged items were held, returned, or sold, and many of those principles still shape pawn law today.
Medieval Europe and the “Mountains of Mercy”
In the Middle Ages, strict limits on charging interest made ordinary lending difficult, but lending against collateral filled the gap. In 15th-century Italy, charitable lenders opened the first monti di pietà, or “mountains of mercy.” These public pawn banks offered low-cost loans to working families so they wouldn’t have to turn to loan sharks. Several of them grew into banks that still operate today.
Merchant bankers from northern Italy’s Lombardy region carried their lending practices across Europe. Their name stuck: London’s financial district grew up around Lombard Street, and in languages such as Polish and Russian, a pawnshop is still called a lombard.
Even royalty pawned. England’s King Edward III famously pledged his jewels in the 1300s to help pay for his wars.
The Three Gold Balls
The pawnbroker’s symbol of three gold balls is recognized around the world. Its origin is part history and part legend. Many trace it to the Medici family of Florence, whose coat of arms featured round balls. Others connect it to St. Nicholas, the patron saint of pawnbrokers, who according to legend secretly gave three bags of gold to a poor family so their daughters could marry. Either way, the three balls have meant “help is available here” for centuries.
Pawning in America and the Gold Rush
Pawnshops came to America with early settlers and grew alongside its cities. Sacramento was a supply hub during the California Gold Rush, and trading and borrowing against gold and valuables was part of everyday life here from the beginning.
Today, California’s pawnbrokers are licensed and regulated by the state, and every transaction is reported to law enforcement to protect customers and the community.
Our Part of the Story
Capital City Loan & Jewelry opened its first store in Sacramento in 1992. More than 30 years and four locations later, we’re still doing what pawnbrokers have done for thousands of years: helping our neighbors get cash quickly and fairly, and keeping their treasures safe until they come back for them.
We’re proud to be called the Friendliest Pawnshop in Town. Stop by any of our four Sacramento locations, or call (855) 438-7296.