Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1915-01-27
MAKING THE PAWNSHOP 'RESPECTABLE" E"
Kansas City Municipal Agency Enables Its Patrons Borrow
Much Pride the Bankers Customers.
BY RALPH PERRY



A WEALTHY man may go to his banker
"A and borro5i upward In the thousands,
thereby receiving from the public in general
respect and communication; but when his less
fortunate brother negotiates a loan on what
personality he may possess from his banker,
''tho pawnbroker," the public looks with dis
dain on the transaction.
Here we are confronted with a remedial
contrariety interesting of analysis. The sttg-
ma connected with the pawnshop Is not one
attributable to its patrons. 1t Is in large
measure due to the unscrupulous people in
the business. Regardless of how meritorious
a mans actions may be in obtaining loan
from the pawnbroker, he will exert every pre-
caution to avoid publicity. oftentimes relying
on the pawnbroker's honesty rather than re-
Ceive pawn ticket, for fear of having 1t
found on his person or unconsciously expos
ing It. Now the pawnbroker, being aware of
the average customers feeling in the matter,
takes advantage of such conditions and
charges usury with impunity, knowing full
well that his customer would far rather be
his victim than resort to any legal process
for help, thereby acquainting the public with
the transaction.
No Alternative
However, the pawnbroker's customers are
with this self pride are always to be found
in the minority. The greatest source OF
revenue in this business is derived from the
people who have no alternative, those who
are compelled to pledge their personally for
the lack of other means of obtaining ready
cash to fulfill their immediate needs and who
vociferously denounce the pawnbroker and
his usury but find no relief.
1t was then, in the first place, to relieve
these people of an unjust burden placed upon
them by circumstances and to enable them
to transact their business of borrowing with
as much respect and pride as the bankers
customer; and secondly, to provide substi-
tute for the pawnshop where money could
be had on equitable terms, that the Welfare
Loan Agency was established,
Two years ago Kansas City had more
pawnshops in proportion to its population
than any other city in the country Although
the legal rate of interest in Missouri is 2 per
cent. per month"; the universal charge was 10
per cent. per month. At the present writing
10 of the shops have gone out of business.
One conforms to the legal rate Of interest on
loans of S5 or more and the others now
charge in the nelghborhood of per cent. on
loans of 500 and upward, and and 10 per
cent, on less amounts.
Usury Evil Incurable
The work done by the welfare Loan Agency
has proved conclusively that no amount of
legislation can cure the usury evil. In less
than two years $1,000 loans have been made,
each one symbolic of relief and good done,
while the criminal records in a like period
fail to show any prosecution by the State
authorities for usury
One unsatisfactory phase OF the work Is
the lack of previous Investigation before
negotiating a loan. If this could be satls-
faotorify carried out, the unnecessary loans
would be abolished and the borrower greatly
benefited. II would be far better for the pub
lie TO manage their affairs in such way as
to avoid the necessity of loan. But we
must cope with conditions as they are and in
the meantime strive for ideals and the grad
uai evolution OF mans customs and affairs. A
most significant fact ana one which must
constantly be kept paramount Ia the average
borrowers willingness to enter into an unfair
contract In order to obtain loan. To beneit
the borrower he must be offered the same
amount OF money on his pledge as the usur-
ious pawnbroker offers and at much lower
rate OF interest
Sound Business Principles
The work OF the Welfare Loan Agency has
demonstrated that money can be loaned on
personality at a reasonable and legal rate OF
interest. on sound business principles with.
out assuming any OF the aspects OF chart
table association and that a return OF per
cent. per annum on the investors capital
can be made.
In eonsradistinetion to the private pawn,