Perhaps surprisingly, the Iglesia Monte MiEPi on Calle Procuraduría General de Justicia in Mexico City stands as a testament to faith. But its story is intertwined with the history of lending to the less fortunate.
The Nacional Monte de Piedad is a not-for-profit pawnshop. It sits near Mexico City’s main plaza. Don Pedro Romero de Terreros, the Count of Regla, ordered it to be built between 1774 and 1777. His aim was to provide low-interest loans to the poor. The Mexican government recognized it as a national charity in 1927.
The Monte de Piedad movement started in Italy in 1450. The Franciscan Order wanted to give financial help to people with no-interest loans. Instead of interest, borrowers donated to the Church. The idea spread through Europe. Pedro Romero de Terreros brought it to New Spain.
Terreros founded the Sacro y Real Monte Pío de Animas between 1774 and 1777. King Charles III approved it. He let Terreros use part of the College of Saints Peter and Paul, where the main office is today. Terreros initially gave 300000 pesos of gold to fund the project. Like other Monte de Piedad places, Terrenos’s foundation did not charge interest on loans. He urged borrowers to donate to Church groups and pray.
Operations started in 1775 at the College of Saints Peter and Paul. In 1818, Don Viceroy Apodaca ordered the building to be evacuated. This was due to problems with the Independence movement. But it did not happen until 1821. King Ferdinand VII took Jesuit properties. The foundation moved to the Franciscan Convent of Saint Bridget. In 1836, it moved again to two houses owned by the Duke of Monteleone. The Monte de Piedad bought the old college structure and its original home in 1836.
After Independence, the new government sanctioned the institution. It gained its current name. In the early 19th century, mismanagement and political unrest caused financial problems. However, by the end of the century, it was financially stable. It began to issue its own money. In 1927, it was legally declared a private charity.
Since its start, it has had two main goals. First, it provides loans to families with emergency needs. It gives favorable terms without seeking financial gain. Its main lending method is microloans using pawned objects. In 1782, the board decided to charge fixed interest due to early losses. As a charity, they accept items worth as little as 30 pesos. The average loan is about 500 pesos. Most items are jewelry and watches. But they also take cars, appliances, and linens. They have since added banking services and home equity loans.
Second, the institution donates its earnings. It has donated to over 1500 charities. Yearly donations average 400 to 450 million Mexican pesos. It also supports education with scholarships.
From 1988 to 2000, Monte de Piedad had 33 to 35 branches. By 2008, it had grown to 152 branches. The foundation expects to give pawn loans to 750000 families. This would represent a large increase nationwide from 2007.
Loans can be for any purpose. Many are to remodel houses, send kids to college, or start a business. There has also been a rise in people seeking loans to cover credit card overdrafts. Many loans are for back-to-school expenses, vacations, and after the Christmas holidays.
Monte de Piedad’s interest rate on pawned items is low. The recovery rate is high. Every two weeks, unclaimed items are sold at public auction.
The Monte de Piedad, a place with lava-rock walls, offered loans for centuries. It is more than just a building. It’s a symbol of hope and support for the people of Mexico City.