Stadsbank van Lening (City Pawn Bank) – MforAmsterdam Tours (2024)

The Amsterdam Stadsbank van Lening (City Pawn Bank) is a not-for-profit city pawn shop dating from 1614 at Oude­zijds Voor­burg­wal300, with a back entrance at Nes57. Itis the oldest official credit distri­butor in Amsterdam. Todayit has about 85 employees working here, in the associated auction and in the offices on the Bijlmer­plein and Osdorp­plein. Once they accepted almost everything you could think of (clothes, textiles, merchandise and house­hold items), since 2016 they accept only jewelry, gold, silver, diamonds and watches.

Thetext above the doorway, written by Balthazar Huydecoper in 1740, reads (translated):

If you have neither money nor goods, then pass this door by
If you have the latter, but miss the first, then come to me
Give me a pawn and I will give you money. Why should I warrant you?
Is it not enough that you live off what is mine?
But if you demand your pawn back, then you must take care in time
To repay me my main sum, with the added interest
So that I can help both you and me, and show the auditors
Of my secrets, the grave of the honorless loan sharks

To describe a visit to the Pawn Bank, which was not seen as being very honorable, eufemisms were used, like: “visiting Uncle John” or “climbing the doorstep of shame” instead of “going to the Lommerd” (from Lombards, the north-Italian pawn brokers who introduced the pawn loans). The Lommertbrug which led to the pawn bank was jokingly nicknamed the “Bridge ofSighs”, even though it doesn’t in the least resemble the famous bridge in Venice.

Interest Stigma

The revulsion against the charging of interest existed in many cultures. Inthe 4thcentury Christian councils denounced the practice, in 789 Emperor Charlemagne issued a law prohi­biting the charging of interest. Italianpoet DanteAlighieri put the usurers in the seventh circle ofHell. The philan­thropy of Italian Renais­sance families was partly inspired by feelings of guilt about their profits from interest. TheChurch’s position was that extracting even a single cent of interest wasevil. Thisstigma continued well into the 1500s, while the local church or a wealthy family were often the only source of capital. Manypeasants bought their land by getting mortgages from a monastery.

The Lombards

During the crusades (1100-1300) trade with the Arab world grew and Italian cities started to provide credit against collateral. Creditswere initially provided mostly by Jewish bankers, who were not restricted by the dictates of thechurch. Whenthe pope condoned the practice in the 11th century, Italians entered this credit businesstoo. Inthe 13th century, when the church prohibited the charging of interest again, many of these lenders movednorth. Because they mostly came from the Lombardy and Piemonte regions, they were called Lombards every­where. Theysettled in Amsterdam in1477.

The Italian money changers set up a banca (bench or counter in old Italian) on the many annual markets, traveling with merchants throughout Western Europe. They introduced the “lettera di pagamento” (letter of payment), which was basically a loan with interest, and gave loans for collateral. They provided credit for pawn, eventually mostly to the poor. Their practice of charging way too much interest (sometimes up to 80% yearly in difficult times) eventually meant their demise, as many cities ordered restrictions and took over the handing out of loans. The origin of the term bankrupt also came from these Lombards: when they could not meet their financial obli­gations or mal­functioned, they had their table demolished, “banca rotta” in Italian, broken bench.

Amsterdam & Loan Sharks

The city first attempted to expel the loan sharks in1547, but that did not make a big enough dent in the practices at first. Then, afterthe 1578 Protestant Alteration, additional measures were taken, because the Reformed Protestants were dead set against usury. Someprivate pawn shops were given permits, the worst were prohibited from operating. Tocounteract the private loan sharks, the city established their own pawn bank in1614. Theyused interest rates between 8% and 16% and any profits were used to finance poorrelief. Othercities followed the Amsterdam example later.

Mountains of Compassion

As early as the 15th century some cities in Italy had started to create so-called Mountains of Compassion (Latin: mons pietatis, City Loan Banks), as a protection for people in financial direstraits. The first opened in Perugia in 1462, started by Franciscan monks. Theseloan banks did not aim for profit and were mostly operated to counteract the private pawn banks. Eventually the church condoned their charging of interest, to keep them afloat.

InAmsterdam the Bankruptcy Chamber (Desolate Boedelkamer) was established in1643, which mediated between creditor and debtor, holding both responsible for the over­crediting. Whenthe debtor had sold all his belongings, the debt was officially cancelled and the creditor had to accept the additionalloss. In1893 the Bankruptcy law was adopted in the Netherlands — when someone cannot pay their debt and has at least two creditors, they can be stripped of their belongings and declared bankrupt. Eventoday loans still operate under these conditions.

Location of the City Pawn Bank

Were the City Pawn bank is now, there was originally a peat pond which drained to Rokin, filled in when the Oude­zijds Voor­burg­wal was created. Theconvent of Saint Mary Mag­dalene started there in1407 — a new convent was built in1422. Thewater of the ditch running to Rokin was covered in1550, Enge Lombard­steeg and Wijde Lombard­steeg created ontop, a peat ware­house built next to thealley. After1579 the convent was used by the Leprozen­huis (LeperHouse). In1613 the city took over the north wing and the ware­house to establish the City Pawn Bankthere. Thehouse on Nes (from 1890) was added to the complexlater. The main building on Oude­zijds Voor­burg­wal was added in 1669 as replacement for the old convent wing, the old entrance gate incor­po­rated in thefaçade.

Income Fluctuations

Above the side entrance on Enge Lombardsteeg the text reads: “To help the needy a loan bank for small sums was establishedhere”. Exceptof course the very needy were not helped by that, as this only worked if you had something to pawn in the firstplace. Mostpeople in those times did not have a steady income, as they had seasonal or temporaryjobs. Merchants and craftsmen also suffered large fluctuations in income.

Keeping your family housed, fed and warm was a challenge in those circ*mstances. Manyfamilies coped by regularly pawning small items, winter coats, or even Sunday church clothes during the week — to recollect them after payday onFridays. Clothes handed out by orphanages, schools and other institutions had marks sown into them to prevent pawning. Forthose who could not turn to family or neighbors these short term loans were essential for survival.