Annuity loans and private credit in Britain, 1750-1813

Credit dominated the financial landscape of eighteenth-century Britain. One element, the annuity loan, has been viewed, both in the eighteenth century and subsequently, as on the margins of the financial market, used only by gamblers and spendthrifts, and professional moneylenders. This thesis challenges this preconception. It relocates annuity loans more centrally within the contemporary financial market to reflect their importance in credit provision and investment. It presents annuity loans as a response to the market’s structural deficiencies and institutional inadequacies.
This first detailed study of annuity loans draws on a previously overlooked documentary record of borrowers and lenders established by the Annuity Act, 1777 to create a database of 47,000 transactions and to present a picture of individual lending and borrowing in Britain between 1750 and 1813. The use of annuity loans by diverse borrowers and lenders, whose profiles and motivations are explored, shows how extensive was the practice of money lending in late Georgian Britain. The annuity loan market demonstrated remote, impersonal features, particularly the use of advertising and the activity of intermediaries. Yet the nature of the
borrower/lender relationships evidenced in these records demonstrates how credit continued to be constructed, negotiated and maintained in personal terms.
During this period the state sought finance for its political and military ambitions in competition with the needs of industry, commerce and individuals in a growing economy. Whilst historians have considered the consequences of this contest for the form and function of the financial markets, the diffuse nature of documentary sources has held back consideration of its impact on private credit.
Tracing the pattern of activity in the annuity loan market allows the interaction between the two markets to be explored to consider the extent to which public debt issuance periodically curtailed the availability of private credit.