Working-class consumer credit in the UK, 1925-60: the role of the check trader

Credit has played a fundamental and controversial role in working-class budgets. Numerous historical surveys have acknowledged its significance in both the diffusion of consumer durables and in the management of the basic needs of the poorest families. Consumer credit was already extensive by the time County Courts were established in 1846 to deal with disputes over petty debts, and the second half of the nineteenth century witnessed the emergence of several new modes of consumer credit. This article investigates check trading, which has not received concerted analysis, unlike hire purchase, mail order, the credit drapers, or pawnbroking. The sector is significant for several reasons. First, its scale and scope were impressive. Check trading was utilized by millions of working-class consumers in managing family budgets. Second, its creation and success underline the validity of recent assertions by Finn and Taylor—who both maintain that important segments of the consumer credit market remained reliant on informally gathered personal information about customers and a high degree of sociability between retailers (or their agents) and shoppers long into the age of modern-day consumer society, which is often identified with de-personalized shopping. Finn argues that economic models inadequately theorized the social nature of credit offered by Victorian and Edwardian retailers. Borrowing from Mauss and Bourdieu, she argues that nineteenth century retail credit remained strikingly reliant on factors that had their roots in the routine obligatory gifting patterns of traditional societies. Thus, for Bourdieu credit ‘creates obligations . . . by creating people obliged to reciprocate’. In the credit markets analysed by Finn, retailers endeavoured to create reciprocation in the form of long-term loyalty from their customers by paying as much attention to personal ties as to price considerations. Whilst Finn’s influences are anthropological, Taylor develops the sociological analysis of Giddens to probe twentieth-century working-class credit. Taylor points out that companies specializing in this sector were ‘ultimately somewhat anachronistic’ and ‘in a sense, a survival from a previous era’ that was out of step with the ‘highly bureaucratised methods employed in other sections of the credit industry’. He maintains that a process of ‘routinisation’ of the social practices carried out by suppliers of credit in working class communities—essentially the weekly collections of payments—created a sense of ‘trust or ontological security’, that was psychologically relaxing for customers. Taylor also argues that a mixture of altruistic and instrumental motives drove the agents who carried out these collections. Importantly, this combination reflected the emotional and economic elements of the relationships formed between credit suppliers, agents, and regular customers. The hundreds of thousands of agents operating in the mail order and check trading sectors were drawn from within the working-class neighbourhoods in which they carried out their work, enabling their employers to become embedded within local social networks. This factor was highly significant in a period of increasing competition from alternative sources of credit after 1945. This article will extend Finn’s and Taylor’s important insights. Focusing on the provision of consumer credit to working-class families, it argues that it was within this sector of the market that the relationship between credit provider and recipient became most strongly based on personal ties that cultivated customer loyalty and obligation. This effectively institutionalized and captured elements of gifting and obligation within what was nominally a commercial relationship. The effectiveness of one such operation is demonstrated herein through detailed analysis of Provident Clothing and Supply Co. Ltd. Scrutiny of Provident’s records and its modus operandi allow us to extend Taylor’s arguments about the nature of the relationship between the traditional suppliers of credit to working-class communities and Provident customers. The article offers a unique statistical analysis of a closely defined sector of working-class credit. No other company in this sector has made its records available for historical analysis and hence, for the first time, statistical flesh can be put on the bones of historical assumptions about important trends in working-class credit. The data covers the years between the early 1920s and the early 1960s, when Provident became a public company. Since the late 1960s and early 1970s, check traders have transformed themselves into a highly organized, well-financed, and lucrative brand of moneylenders, specializing in lending to low-income households. As a result, they have attracted the ire of anti-poverty campaigners, being accused of exacerbating the money management problems of the poorest groups, which echoes earlier critiques of check trading. The final aim of the article is, therefore, to describe the check trading system, its operations, and its scale. It does so in order to explain how check traders established the knowledge, systems, agency, and customer networks that underpin their current role as ‘subprime lenders’. It demonstrates how the system operated—through the check trader’s imposition of an external discipline of contract on those working-class consumers who became regular customers as a result of the routinization and the intimate contacts that formed the bedrock of check trading, and continue to be integral to contemporary moneylending.