Lombard banking was a mount of piety style of pawn shop in the Middle
Ages, a type of banking that originated in prosperous Northern Italy,
called Lombardy as a whole during the Middle Ages. The term was
sometimes used in a derogatory sense, and some were accused of usury.A
Christian prohibition on profit from money without working made
banking sinful. Though Pope Leo the Great forbade charging interest on
loans by canon law, it was not forbidden to take collateral on loans.
Pawn shops thus operate on the basis of a contract that fixes in
advance the "fine" for not respecting the nominal term of the
"interest free" loan, or alternatively, may structure a
sale-repurchase by the "borrower", where the interest is implicit in
the repurchase price. Similar conventions exist in modern Islamic
banking. Various ways around the prohibition were devised, so that the
lowly pawnshop contractors could bundle their risk and investment for
larger undertakings. Christianity and Judaism generally ban usury, but
allow usury towards those outside their faith. Thus Christians could
lend to Jews and vice versa. The only real necessity for a young man
who desired a future in the financial world of the Middle Ages was the
ability to read and write; the methods used for bookkeeping were
carefully kept within families and slowly spread along trade routes.
Therefore, this knowledge was available most readily to Jesuits and
Jews, who consequently played a major role in European finance. Later
the Jesuits took the role of go-between with heads of state, while the
Jews manned the low-end pawnshops.[citation needed] This explains the
disproportionately large share of Jews in the goldsmith trade and
early diamond market (diamonds being a lightweight alternative to
gold).A Christian prohibition on profit from money without working
made banking sinful. Though Pope Leo the Great forbade charging
interest on loans by canon law, it was not forbidden to take
collateral on loans. Pawn shops thus operate on the basis of a
contract that fixes in advance the "fine" for not respecting the
nominal term of the "interest free" loan, or alternatively, may
structure a sale-repurchase by the "borrower", where the interest is
implicit in the repurchase price. Similar conventions exist in modern
Islamic banking. Various ways around the prohibition were devised, so
that the lowly pawnshop contractors could bundle their risk and
investment for larger undertakings. Christianity and Judaism generally
ban usury, but allow usury towards those outside their faith. Thus
Christians could lend to Jews and vice versa. The only real necessity
for a young man who desired a future in the financial world of the
Middle Ages was the ability to read and write; the methods used for
bookkeeping were carefully kept within families and slowly spread
along trade routes. Therefore, this knowledge was available most
readily to Jesuits and Jews, who consequently played a major role in
European finance. Later the Jesuits took the role of go-between with
heads of state, while the Jews manned the low-end pawnshops.[citation
needed] This explains the disproportionately large share of Jews in
the goldsmith trade and early diamond market (diamonds being a
lightweight alternative to gold).It comes as no surprise that the pawn
shops of Rome were the most prosperous of all, especially in the 16th
century under Popes Pius IV and Sixtus V. This Italian "Lombard" pawn
shop method became famous. The use of the term "Lombard" for pawn shop
grew slowly from city to city and became prevalent in Cahors, southern
France,[citation needed] from where the Christian Cahorsins moved as
far north as London and Amsterdam in the 13th century; at the latter,
they were called Cahorsijnen, Cawarsini or Coarsini.In France the
Lombards became synonymous with the Cahorsins. Most European cities
still have a street named Lombard Street after the pawn shop that once
resided there. In Dutch, the name for a pawn shop is still lommerd,
and the same etymology persists in the names of various banks (unless
named after some family). In Ukrainian, Polish and Russian, a pawn
shop is called simply lombard. Lombard banking Top Movies & Young Movies