History of Pawnbroking - Spain

Spain

The monts de piété in Spain have for a generation past been inseparably connected with the savings banks. We have already seen that the institution owes its origin in that country to the charitable exertions of a priest who charged no interest, and the system grew until in 1840, a century after his death, the mont de pit began to receive the sums deposited in the savings bank, which had just been established, for which it paid 5% interest. In 1869 the two institutions were united. This official pawnshop charges 6% upon advances which run for periods varying from four to twelve months, according to the nature of the article pledged, and a further months grace is allowed before the pledges are sold by auction. Private pawnbrokers are also very numerous, especially in Madrid; but their usual charges amount to about 60% per annum. They appear, however, to derive advantage from making larger advances than their official rivals, and from doing business during more convenient hours. In Portugal the monte pio is an amalgamation of bank, benefit society and pawnshop. Its business consists chiefly in lending money upon marketable securities, but it also makes advances upon plate, jewelry and precious stones, and it employs officially licensed valuers. The rate of interest varies with the bank rate, which it slightly exceeds, and the amount advanced upon each article is about three-fourths of its certified value. There is in Portugal a second class of loan establishment answering exactly to the English pawnshop. The pawnbroker is compelled to deposit a sum, in acceptable securities, equal to the capital he proposes to embark, and the register of his transactions must be submitted quarterly to the chief of the police for examination. As regards small transactions, there appears to be no legal limit to the rate of interest. The sale of unredeemed pledges is governed by the law affecting the monte pio geral.