A pawn shop is a business that offers secured loans to customers, using personal property as collateral. Pawn shops are often found in low-income areas and cater to customers who may not have access to traditional banking services. Pawn shops typically offer short-term loans, with high interest rates, and may also sell used merchandise.
Pawn shops have been around for centuries, and have been featured in literature and popular culture. In the United States, pawn shops are regulated by state and local laws. Pawnbrokers must be licensed and must follow certain rules regarding the types of loans they can offer and the interest rates they can charge.