“The institution of pawnship, specially the use of people as collateral for credit, helped underpin the Atlantic slave trade” (p.68). Leaving people as collateral solve the trust issue attached to credit (p.69).
Several types of pawnships existed (p.70). Europeans often reported the habit for one to pawn himself if too poor to survive. People also often offered themselves as collateral for a credits and if they failed to repay, they became slaves for debt (p.71). In domestic trade the use of pawns to guarantee a debt seem to have been fairly common in 18th-century West Africa. The institution seems to have been indigenous (p.72).
People held for debt were rarely sold to the Europeans and in any case represent only a small fraction of those forced through the Atlantic. Panwning as a collateral was widespread an only rarely involved human pawns. The practice may well have been ancient and its origins don’t seem tied to slavery (p.73).
Pawnship as a collateral is designed to avoid panyarring (collective liability allowing any wronged creditor to seize and sell a relative or countryman of the defaulting debtor; p.74). “Pawning theoretically secured the loan in advance, thereby forestalling arbitrary seizure” (p.75).
European slave traders commonly used pawnship (human or otherwise) to guarantee the loans (usually in goods) they granted their African partners. The pawns were to be redeemed at the delivery of the slaves or other cargo (p.76). On the Gold Coast, gold was often pawned (p.77) but in many places there were few valuables other than people to be offered as guarantees.
On board the European ships the pawns could be regarded as slaves, but were generally well treated as the traders feared to harm their relationship with the locals if pawns were returned ill-treated or dead, which in turn may disturb trade.
“The extent to which Europeans adopted local African practices in relation to debt security is also indicated by the fact that on occasion Europeans themselves were held as pawns. When African merchants extended credit to ships or feared arbitrary seizure by ships, European might be required to provide collateral in a form that was locally acceptable” (p.78).
As an instrument favouring credit, pawning certainly help the development of the slave trade over Africa in the 18th century (p.81). The quality of the persons pawned was important for the deal to go through, European often asked for African headmen and merchants’ own kinsmen. The European sometimes demanded 2 pawns for every 3 slaves to be delivered, but the African parties often tried to lower that ratio as it represented a important loss of labour. When a recurring relationship was to be expected the Europeans accepted to merely pawn their African partners’ future earnings (p.82).
But even in case of default, pawns were seldom sold as slaves which might have endangered the business relationship with the locals. In case of delay, pawns were sometimes sold off to another ship while the original creditor sailed to the Americas (p.83). But the threat was sometimes enforced and pawn sold away as slaves, sometimes hundreds at the time (p.84).
Such mechanism was not risk-free and some captains sailed off with pawns aboard before the time for redemption had expired. In one instance a British ship was even chased by a Dutch man o’ war after having broken a contract with a Cameroonian merchants and left with the pawns. Other times, Africans kidnapped European sailors to get the pawns back (p.85).
On the African side, secret societies behaved like merchant guilds replacing recalcitrant pawns or preventing ships from leaving with their hostages. Numerous conflicts were solved in front of the Palaver House, the court of justice (p.87).