Provident Loan Society

The Provident Loan Society of New York
Nonprofit organization
Industry Lending
Founded 1894 (1894) in New York City, New York, United States
Headquarters New York City, New York, United States
Key people
Founders included Cornelius Vanderbilt, J.P. Morgan, Jacob H. Schiff
Products Loans

The Provident Loan Society is an American not-for-profit organization headquartered in the Manhattan borough of New York City, New York.

It was created in the 19th century by a group of influential New Yorkers as an alternative to loan sharks of the day. Founders include J.P. Morgan, Jacob H. Schiff, August Belmont, Jr. and Cornelius Vanderbilt.[1]

Today, Provident Loan provides short-term cash loans for gold and jewelry and is the last remaining of the many not-for-profit loan societies created during the economic crisis of the late 19th and early 20th centuries.[2]


The Provident Loan Society was created during the financial panic of 1893.[3] In an uncertain economic environment amid foreclosures and bank failures, people sought cash from unregulated loan sharks and pawnbrokers.[4] As a result, a group of powerful New York bankers and financiers pooled money together, pledging $35,000 each[5] to establish a not-for-profit organization to provide short-term loans at a lower rate than the loan sharks. The organization was modeled on European financial institutions known as mont de piété or mount of piety.[6] The contributors included Solomon Loeb, Alfred B. Mason, J.P. Morgan, Gustav H. Schwab, Jacob H. Schiff, James Speyer and Cornelius Vanderbilt, among others.

The New York State Legislature passed a special act in 1894 incorporating The Provident Loan Society of New York.[7] At its peak in 1962, the Society had seventeen locations around New York. As of 2009, there were five remaining locations.[8]


building on Houston St and Ave A

Today, Provident Loan states that it serves approximately 100,000 people annually. The maximum amount that the institution will loan is $100,000[9] for a term of six months at an annual interest rate of 26%.[10] New York State laws governing pawnbrokers allow pawn shops to charge up to 48% annually.[11] Provident Loan will not buy merchandise, however, only lend against its value.


  1. "Cheap Loans a Success". The New York Times. December 10, 1894. Retrieved February 16, 2012.
  2. John P. Caskey, Fringe Banking, p. 24.
  3. Pleven, Liam (September 15, 2011). "Gold's Luster a Bright Spot in Tough Economy". Wall Street Journal. Retrieved September 15, 2011.
  4. John P. Caskey, Fringe Banking, p. 24.
  5. Hampson, Rick (October 9, 1988). "Society Brought Dignity to Borrowing : Pawnshop Opened by Tycoons Is Still the 'Poor Man's Bank'". Los Angeles Times. Retrieved February 16, 2012.
  6. "Charity in Business Guise". The New York Times. March 11, 1894. Retrieved February 16, 2012.
  7. "New York Social Diary".
  8. Gray, Christopher (October 15, 2009). "The Best-Looking Pawnshops Ever". The New York Times. Retrieved October 18, 2009.
  9. "New York Social Diary".
  10. "Provident Loan".
  11. "Downloadable Handout on Pawnbroking in New York State".
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