MUNICIPAL PAWNSHOPS.

Auckland Star, Volume XXX, Issue 76, 1 April 1899, Page 3 (Supplement)

MUNICIPAL PAWNSHOPS.

On the Continent the business of pawnbroking is carried on by the municipality. Most European countries possess their public pawnshop to protect the people from ururers. The general plan on which these public pawnshops are worked is thus described by Mr T. H. Roberts in a recent number of the ' Social Democrat' :— They accept loans from the public like savings banks and they lend that money out at a slightly increased rate of interest. The public pawnshop of Paris possessess a great central establishment and over thirty branches in different parts of the city. The number of articles'upon which loans were made in 1892 was over 2,250,000 and the amount advanced was close on £2,500,000 sterling. Thus the public pawnshop, upon the average, make a loan each year of about 25 francs, or £ 1 sterling, to every man, woman, and child of Paris. The rate of interest charged is 6 per cent., as compared with 50 per cent, charged by private pawnbrokers in this country, and ther is a fixed charge of 1 per cent, to cover insurances upon the articles charged. The public pawnshop is able to borrow all the money it requires at 3A per cent, upon yearly deposits and as low as 2 per cent, upon deposits for shorter periods. There can be no doubt the public pawnshop is a great boon to the poor. It advances sums as low as 3 francs (or 2s. Cd. of our money). It is said the small loa,ns are made at a loss to the institution, which is more than counterbalanced by the profits on the loans for larger amounts. Great care is taken of the" articles pledged, and, in the case of bedding, it is carefully disinfected before being returned to the owner. The public pawnshops have also proved a valuable agency in assisting the police in detecting and preventing stealing. It is said that about 360,000 watches are received in pledge every year by the Paris pawnshop, and that only 250, or seven out of 10,000, prove to have been stolen. This is an amazin°- record, yet it is further true that J the public pawnshop receives three times as many stolen watches as all the stolen articles put together. In Paris the surplus profits of the public pawnshops, which amount to a considerable sum, are devoted to the hospitals. • ' In Germany, money-lending is carried on by the State and by the municipality, and the surplus profits are devoted to charitable purposes. Even the private pawn shops are not allowed to retain any surplus which may be obtained on the sale of unredeemed pledges after the payment of expenses. The amount of the surplus has to be paid into the savings bank into the account of the . owner, and if not claimed within a year, the money may be devoted to parochial objects. Public pawnbroking is also in vogue in Spain, Austria, Hungary, Belgium, the Netherlands, and Italy, where it was first introduced in Florence at the end of the fifteenth century by the great Savonarola. In Italy very small ioans are advanced for six months, free of interest, and Italy is not quite alone in this respect.