Do we ignore the biblical teaching on usury?


It is often claimed that contemporary Christians ignore the biblical teaching that prohibits usury—usually interpreted to mean either lending at interest or lending at excessive interest. This is significant for three main reasons:

  1. The suggestion is then made that in other areas of ethical debate (sexuality, divorce, gender relations, the Sabbath principle, other areas of economics) we either don’t need to attend to what Scripture says, or we cannot do so since this would be inconsistent.
  2. National and global issues relating to finance are arguably the biggest ethical challenge we face, and we will be ill-equipped if we ignore key biblical teaching.
  3. Our post-industrial globalised context is far removed from the largely subsistence, agrarian context of much Old Testament law, so this is an important text case in how we interpret Scripture intelligently.

This comprehensive analysis by Thomas Renz, which he developed in conversation with others who contested his conclusion, and was first posted eight years ago, offers 12 theses on the meaning and interpretation of the ban on usury. It is a quite long article, but it helpfully traces the nuances of the OT texts, the way that these nuances have been missed in some parts of the interpretive tradition, but wrestled with at other times, and it highlights some key issues for interpretation today.

Note: Usury is today understood to refer to “exorbitant interest” but in the past the word was used to refer to usage charges on loans, that is to any form of interest payment, whether interest was 20-25% or 60% or just one percent.

1. Commercial loans were known in antiquity

See M. Silver, Economic Structures of the Ancient Near East (London and Sydney: Croom Helm, 1985), esp. pp. 85-89 on the credit and investment market, and his Prophets and Markets: The Political Economy of Ancient Israel (Social Dimensions of Economics; Boston: Kluwer Academic Publishers, 1982), pp. 65-68, for an argument in favour of the existence of commercial loans in ancient Israel.

There was a custom for Mesopotamian kings to proclaim the remission of debts etc. at the beginning of their reigns and at intervals of seven or more years. Such a release was good news for impoverished people, but it would have been bad for business if commercial loans were included in the remission.

We are in the fortunate position of having one such edict preserved in fairly complete form, namely the Edict of Ammisaduqa from the 17th century BC. It explicitly excludes goods which have been loaned “either as merchandise for a commercial journey, or as a joint enterprise for the production of profit.” It even includes a paragraph which specifies what happens to people who pretend that a loan was a commercial loan, when it was not.

It is worth bearing in mind, however, that a neat distinction between consumer loans and producer loans is not always feasible. Barry Gordon, Lending at Interest: Some Jewish, Greek, and Christian Approaches, 800 BC-AD 100 (History of Political Economy, 14:3; Duke University Press, 1982) p. 41, observes the following:

The predominant microeconomic institution in antiquity was the household; this was not merely the modern organization coexisting of a group of consumers. At the same time it was “the firm,” a group of producers. Hence, there was the most intimate relationship in institutional terms between production possibilities, consumption potential, and household capital. When a householder borrowed he was necessarily borrowing as consumer-producer. It is not surprising that it is difficult to discover unambiguous differentiation of business and consumption loans in the literature of antiquity. Certainly, one finds lending to the poor distinguished from lending to others. However, “poor loan” does not necessarily equate with “consumer loan.”

2. Interest-bearing loans were prohibited within Israel’s polity

The prohibition of interest-bearing loans specifically applied to full members of the covenant (brother) but in this context the resident alien (Heb. ger) is to be treated like a brother. Not only must the same judicial standard applied to the stranger and to the native citizen (cf. Exod. 12:49; Lev. 24:22; Num. 15:18), but charity must be extended to the poor regardless of their ethnicity.

The loans in question are specifically loans to people who are not economically self-sufficient in Exod. 22:25 and Lev. 25:23-38 but the prohibition is not restricted to charitable loans, even if it is likely that the need for loans in ancient Israel was much more often related to crop failure than business opportunities. It deserves to be noted that Lev. 25 implies an obligation to charity towards the poor.

While the boundaries between the two were sometimes fluid (see above), it seems possible to distinguish between “charitable” loans for (the production of) necessities and “commercial” loans for expanding production. Only the former is explicitly in view in Exodus and Leviticus but in Deut. 23:19 all interest-bearing loans within Israel’s polity are prohibited.

Such a complete prohibition of interest-bearing loans could have several reasons:

(a) Opportunities for investment in an expanding business were likely rare in ancient Israel; a complete prohibition would not have a major effect on the economy, while protecting the weak from any attempts to dress up what should be interest-free charitable loans as commercial loans. The wide availability of interest-bearing commercial loans would likely reduce willingness to lend without interest to the poor. Thus a complete prohibition serves charity.

(b) It fits with the general ethos of the covenant community envisaged in the Torah that investment at a distance without partnership would be discouraged. Associates who share risks as well as opportunities  form a closer-knit community than  business “partners” whose only link is the actual loan – see the next two theses.

(c) It is possible that interest-bearing loans are considered wrong in itself. But this seems to me ruled out by the permission of such loans to a nokri, see further thesis four.

3. Loans to a foreigner (Heb. nokri) were commercial loans.

Non-resident foreigners need not be traders; a nokri is distinct from a ger by living outside the socio-economic structures of Israel’s polity, that is outside the covenant people in possession of the land allotted to them. Deut. 14:21 implies a distinction between the ger and the nokri.

The ger is regularly mentioned in Deuteronomy alongside the orphan and the widow, e.g. in 24:19 in another context of benefits given free of charge. (The orphan and the widow are not mentioned in 14:21 because an impoverished member of the covenant community must still abide by the food laws; the ger is not a full member of the covenant community and therefore not bound by the food laws, cf. 24:14; 29:11.) There is an obligation to be generous and charitably to the ger (the foreigner who lives among you), but no obligation to be generous to the nokri (the foreigner who does not live among you).

A nokri might be, e.g., a Philistine from Ekron in the olive oil business who goes to a neighboring Israelite town to borrow silver with which to buy an additional mill in the expectation of a bumper harvest. Cf. E. Stern, Archaeology of the Land of the Bible, vol. 2: The Assyrian, Babylonian, and Persian Periods (732-332 B.C.E.)  (New York: Doubleday, 2001), pp. 111-12, for Ekron.

4. The permission of usage charges on loans to the foreigner (nokri) in Deut. 23:20 implies that usage charges on loans are not intrinsically immoral.

The unqualified condemnation of usury in Ps. 15 and Ezek. 18 should not be pressed to invalidate this exception clause. There is nothing to suggest that those in ancient Israel who availed themselves of the permission in Deut. 23:20 were excluded from going up to the holy hill (Ps. 15) and under God’s death sentence (Ezek. 18). It is worth remembering that the opportunity for loans to a nokri would only arise in prosperous times, after the needs of one’s own household were covered and charity was extended to the poor.

There have been several attempts to read Deut. 23:20 in a way which allows for the view that usury is intrinsically wicked. Traditionally, the permissions seems to have been understood as a concession to evil disposition (e.g., Aquinas, Grotius), similar to the divorce regulations. But this fails to deal with the command to treat the stranger as a brother (see above) and merely shifts greed or injustice outside the community rather than limiting it.

The proposal (Calvin; B. Gordon, Lending at Interest, 1982) that the permission applies the lex talionis principle (given that Israelites would be charged interest, if they borrowed from foreigners, it is only right and proper that they should charge interest when lending to foreigners) faces similar problems and fails to take into account that charitable loans were to be a matter for the community in which the need arose.

Ambrose suggested in his Expositions on the Book of Tobit that the permission related to Israel’s warfare against the nations of Canaan (Patrologia Latina, vol. 14, chap. 15; cf. Luther and, e.g., Richard Capel [1586-1656]). This view is today argued by S. C. Mooney: “Usury was part of the violence that Israel inflicted upon the wicked people whom God was driving out before them.” But

  1. there is no hint in Deut. 23:20 of warfare,
  2. the term nokri cannot be restricted to “Canaanite under the ban”, the very next occurrence of the term in Deut. 29.22 relates to someone who comes from a distant country,
  3. there is a difference between subjugating by usury and putting under the ban, see Deut. 7:1-2; 20:16-17; cf. Num. 21:2—the Gibeonites knew this and Saul should have known this in his treatment of the Amalekites.

The most plausible explanation in my view is that the permission relates to the fact that the nokri is a non-resident foreigner whose desire for a loan is both commercial and outside the economic structures of Israel’s polity. This explanation is not traditional but it is at least 300 years old (cf. Matthew Henry). It is the most satisfying explanation because it takes into account that the legal material uses different terms for non-Israelites who have become resident in Israel (Heb. ger, toshab). It is thus eminently plausible that Deuteronomy’s distinction between a ger and a nokri is between resident (semi-assimilated ) and non-resident (non-assimilated).

Echoing Exodus and Leviticus, a primary concern in Deuteronomy is preventing rich people from taking advantage of people who have fallen on hard times. In my reading, the nokri is not the exception to the rule, as if one may take advantage of a nokri—whether as a concession to greed or as part of a campaign to subjugate and eradicate “detestable Canaanites”. The nokri has not fallen on hard times. While a strict distinction between consumer credit and producer credit is untenable for the ancient world (see above), there is a difference between people and families trying to make ends meet and people and families seeking to expand economically. The nokri would fall in the latter category.

5. The Gospel compels us to be just and generous, equitable and charitable.

This includes the admonition to “lend freely, expecting nothing in return” (Luke 6:35). Christians are not under the Law which governed Israel’s polity but they are to form a community whose fellowship includes generosity in sharing material possessions. Jesus challenges us to love our enemies and to do good without expecting dividends in this whole section (Luke 6:27-38). But if, as many of us believe, “to one who strikes you on the cheek, offer the other also” does not prohibit  every exercise of force, and if ” from one who takes away your cloak do not withhold your tunic either” does not abolish the legitimacy of policing, then “Give to everyone who begs from you, and from one who takes away your goods do not demand them back” need not prevent trade and “lend, expecting nothing in return” does not rule out banking. This is emphatically not to say that these injunctions have no role in politics and economics but that the statements must be read in context—”as you wish that others would do to you, do so to them” will preclude many forms of interest-taking but arguably not all.

611ei9K2VpL6. The church fathers categorically condemned usury.

They did so in a context, in which “the main business of usurers was not so much earning interest on their capital as it was expropriating lands and other property that had been offered as security against loans that could not possibly be paid.” (J. L. González, Faith & Wealth: A History of Early Christian Ideas on the Origin, Significance, and Use of Money [San Francisco: HarperCollins, 1990], p. 175). Their sermons make it abundantly clear that they do not have business loans in view, neither condemning them nor commending them.

While usury may refer to any (fixed?) “usage charge on a loan,” it needs to be taken into account that the church fathers, whenever they elaborate on it, seem to have “making profit from misfortune” in view, which was probably by far the most common setting for loans. Cf. The Sacred History of Sulpitius SeverusBook 1chap. 18, and Ambrose, On the Duty of ClergyBook 3chap. 3, par. 20:

It is a mark of kindly feeling to help him who has nothing, but it is a sign of a hard nature to extort more than one has given. If a man has need of thy assistance because he has not enough of his own wherewith to repay a debt, is it not a wicked thing to demand under the guise of kindly feeling a larger sum from him who has not the means to pay off a less amount? Thou dost but free him from debt to another, to bring him under thy own hand; and thou callest that human kindliness which is but a further wickedness.

Lactantius, The Epitome of the Divine Instituteschap. 64

He will not steal, nor will he covet anything at all belonging to another. He will not give his money to usury, for that is to seek after gain from the evils of others; nor, however, will he refuse to lend, if necessity shall compel any one to borrow.

Chrysostom, Homilies on the Gospel of Saint Matthew, fifth homily (on Matth. 1:22-23):

For nothing, nothing is baser than the usury of this world, nothing more cruel. Why, other persons’ calamities are such a man’s traffic; he makes himself gain of the distress of another, and demands wages for kindness, as though he were afraid to seem merciful, and under the cloak of kindness he digs the pitfall deeper.”

7. The condemnation of usury in the early church is closely related to the call to invest available money with God by giving it to the poor.

The notion that Christians ought to use every possession they do not actually need to alleviate poverty is widely attested in the patristic literature. See González, Faith & Wealth for an overview. The immense importance of almsgiving and the power attributed to it can be seen in Cyprian’s Treatise on Works and Alms summarized by Gonzales on pp. 124-28. I found Gonzales’ chapter on The Cappadocians (pp. 173-86) particularly illuminating.

8. Scholastic theologians developed the idea that usury is intrinsically wrong (making no distinction between consumption and production loans) but they sought to be just in taking into account risk and opportunity costs.

Some may have done so because they wanted to avoid the plain prohibition of usage charge on loans but no doubt some were keen to be accurate, logical and fair in their understanding of what is at issue. In either case, we need to evaluate their arguments and leave evaluating their motives to Almighty God to whom all our hearts are open.

It is worth bearing in mind that attitudes to usury were not entirely stable in the medieval period. The Church and Christian rulers often allowed usury—to be practised by Jews, not least when a pope or king needed money, one suspects. At other times strong condemnations of usury came in handy as an encouragement to participate in the the Crusades (as a form of penance). For discussion see E. S. Tan, “Origins and Evolution of the Medieval Church’s Usury Laws: Economic Self-Interest,” The Journal of European Economic History (March 2005), also available online.

The same shifts and disagreements can be observed on the Jewish side, see S. Stein, “Interest Taken by Jews from Gentiles: An Evaluation of Source Material,” J Semitic Studies 1 (1956) 141-64. There is a traditional equation of “Christian” with “Edomite” in Jewish thinking which would prohibit Jews from taking interest from Christians, because an Edomite must be treated like a brother. Those in favour of exacting usury from Christians (the only business in town!) had to argue that Christians are not in fact “Edomites.”

The classic discussion is in Thomas Aquinas, Summa Theologica, 2.ii, question 78, but the encyclical Vix Pervenit (On Usury and Other Dishonest Profit) promulgated on 1 November 1745 by Pope Benedict XIV may be considered the apex of scholastic thinking on the matter.

One cannot condone the sin of usury by arguing that the gain is not great or excessive, but rather moderate or small; neither can it be condoned by arguing that the borrower is rich; nor even by arguing that the money borrowed is not left idle, but is spent usefully, either to increase one’s fortune, to purchase new estates, or to engage in business transactions. The law governing loans consists necessarily in the equality of what is given and returned; once the equality has been established, whoever demands more than that violates the terms of the loan. Therefore if one receives interest, he must make restitution according to the commutative bond of justice; its function in human contracts is to assure equality for each one. This law is to be observed in a holy manner. If not observed exactly, reparation must be made.

This is about as full a condemnation of usury as one might get, small or large profit, commercial or not. But then it continues:

By these remarks, however, We do not deny that at times together with the loan contract certain other titles—which are not at all intrinsic to the contract—may run parallel with it. From these other titles, entirely just and legitimate reasons arise to demand something over and above the amount due on the contract. Nor is it denied that it is very often possible for someone, by means of contracts differing entirely from loans, to spend and invest money legitimately either to provide oneself with an annual income or to engage in legitimate trade and business. From these types of contracts honest gain may be made.

Such complexity (and confusion?) is the basis for those Roman Catholic scholars who argue that the position of the church on usury has not in fact changed like Gary L. Coulter who defines usury as “the prohibition of gain from a loan sought directly by a lender without a just title” and claims that “this is the definition of the usury prohibition as it was taught, understood and interpreted by the Church for thousands of years, just as it is today.” See also Austin Fagothey, Right and Reason: Ethics in Theory and Practice, 2nd ed. (St Louis: Mosby, 1959), pp. 471-74.

9. The Reformers struggled to discern what faithfulness to Scripture meant in the area of financial interest, given the economic developments of their time.

None of the Reformers were thrilled about the commercial practices of their time but while Luther stressed the traditional distaste for usury, Calvin was concerned to uphold the principle that the Church must not bind consciences beyond what is written in Scripture. For Calvin, see, e.g., the essay by Andrew Goddard on Calvin, Usury and Evangelical Moral Theology.

Luther spoke often against usury. His 1519 sermon must have caused something of a stir and was published in a revised form in 1520. The 1520 Sermon was re-published unchanged in 1524 with further material added elaborating on commercial practices. (The site to which I link wrongly gives “1520” for this. My link does of course not imply endorsement on the views expressed on B. Nelson observes that in private correspondence Luther moved from 1525 onwards to a view of interest-taking, in which “the economic situation and the consideration of public utility were of paramount importance” (in M. L. Stackhouse et al. [eds], On Moral Business: Classical and Contemporary Resources for Ethics in Economic Life [Grand Rapids: Eerdmans, 1995], p. 269). In his The Idea of Usury: From Tribal Brotherhood to Universal Otherhood, 2nd ed. (Chicago: The University of Chicago Press, 1969), he distinguishes three phases in Luther’s thinking. Unfortunately, Luther’s 1540 “Admonition to the Clergy that they Preach against Usury” does not seem to be available online.

In England, Hugh Latimer condemned usury as “wicked before God, be it small or great; like as theft is wicked” in his Fifth Sermon upon the Lord’s Prayer and Bishop Jewel explicitly rejected the rich lending to the rich and the merchant lending to the merchant in his Exposition upon the Epistles to the Thessalonians (published 1583, but written some time before 1571), see W. J. Ashley, An Introduction to English Economic History and Theory, Part 2: The End of the Middle Ages, 4th ed. (1906), p. 223.

10. A proper understanding of the concept of time preference demolishes the claim that usage charge on (non-productive) loans is intrinsically immoral.

The concept of time preference realizes that people value $100 now more than $100 in a year’s time, even without inflation or deflation (von Mises, cf. G. Stolyarov). This insight may be added to the acknowledgment of the right to compensation for the expenses of the transaction (damnum emergens), the loss of the opportunity to seize good bargains (lucrum cessans), and the risk of not recovering the principal (periculum sortis). This is of course not to say that a Christian must make use of such rights, or even that Christians are always allowed to make use of them.

11. Contemporary economic arrangements are deeply problematic.

High interest rates and irresponsible lending and borrowing, both on personal and international levels, are part of the problem but the mere existence of interest rates is not the problem. We should not underestimate the role of fiat money and its impact on the issue of interest. A sack of corn is valued differently just before the time to sow seed and just after harvest time but such fluctuations are different from steady inflation of money in our economy. An interest-free loan in which the same entity is returned as was borrowed (a sack of corn for a sack of corn, ten grams of silver for ten grams of silver) is different from an interest-free loan in which the same value is returned. The latter rises the question how to measure real value.

12. The Scriptures traditionally used to condemn all usury have not always been properly understood and applied but they remain relevant for us today. 

The Gospel obliges us to charity and generosity and the regulations in the Torah should still inform our thinking about socio-economic arrangements which please or do not please God. The lifestyle of many Christians today would have been abhorrent to many Christians in the past. But I very much doubt that the church fathers would have put their finger on interest-bearing bank accounts. They would be horrified about the luxurious lifestyle of many of us, while people starve in other places of the world, and about debts being incurred to finance such a lifestyle.

A fundamental hermeneutical principle to remember in this discussion is this: repeating the same words in a different context is not saying the same thing. The condemnation of usage charges on loans in the past was most often connected with concern for the poor. The montes pietatis, non-profit making Christian credit institutions established in the fifteenth century for charitable loans, either went bankrupt once the bequest was used up (if they provided interest-free loans) or charged a small sum of interest to cover running costs and actually helped the poor. Those who condemned these latter institutions on the basis that they were charging interest, and without providing money for all the poor who made use of these loans, drove the poor into the hands of those who charged much, much higher interest rates. Such condemnation was very different from that in the early church.

Let us imagine people who at present own more than they need but who can anticipate a need in the not to distant future—maybe they will need a car to get to work in a year’s time or maybe there will be educational expenses for their children. Are Christians permitted, in principle, to put aside resources for future use? Yes, I should think so. Jesus does not demand that we live hand-to-mouth from day to day. How should they save? Are those who buy for themselves precious metals and hid them under their bed more righteous, because untainted by usury, than those who invest the resources in a microcredit initiative which seeks to help the poor? Just asking.

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49 thoughts on “Do we ignore the biblical teaching on usury?”

  1. I’d say its more that the broader interpretation that we usually apply to scripture in order to make applications in our modern culture is observed in things like usury and divorce, but not on the issue of homosexuality. Its not that usury is treated differently than everything else, its that homosexuality is treated differently than everything else. But that only really applies when the person arguing to condemn homosexuality rests solely on the clobber verses.

    I’d wager that in most congregations there are few if any people who have lent money at interest or even know anyone who has lent money at interest, yet most will have a friend or family member who is gay. So teaching on homosexuality matters far more in a practical context than if our system of banking is immoral. I think most people know that it is, but there’s nothing ordinary folk can do about it. Ordinary folk do need to know if they are allowed to go to their nephews wedding or not.

    • The proportion of the population who are gay is about 1.7%.

      What is the proportion of the population who have a mortgage, or have borrowed money, or live in an economy that depends on the borrowing and lending of money?

    • For a bit of perspective
      1) The Bible does not condemn men loving men or women loving women; the issue is whether it is appropriate to make such relationships sexual given that sex is rather clearly designed for men with women. And note also that the idea that ‘being gay’ is the same kind of simple thing as ethnic differences is deeply flawed; the essence of being ‘gay’ is very much about what people DO and that is a very different moral category.
      2) Yes there are just those few ‘clobber verses’ – but they are also rather clear, despite various stretched and strained attempts to reinterpret them to allow gay sex after all. But as I see it the point is that the Bible gives the absolute minimum to deal with a distasteful issue that isn’t meant to be happening in the first place. IF God approved of gay sex and marriage the kind of ‘law codes’ the Bible includes would have to say a great deal more to cope with all the implications such as inheritance rights – such silence on the topic would be impossible if God really accepted gay sex/marriage.
      3) Both in homosexuality and usury, it makes a difference whether it is accepted that Christian belief is voluntary or whether the attempt is made to have a ‘Christian state’ imposing Christian standards on all.
      Said my bit – can’t dictate of course but suggest further responses be just about usury….

      • Stephen

        I’d say there are actually (at least five) different positions (gay = experience exclusive attraction to the same sex)

        1. Its a sin to be gay
        2. Its not a sin to be gay, but it is a sin to identify as gay
        3. Its not a sin to be gay or identify as gay, but it is a sin to be in a relationship
        4. Its not a sin to be gay, identify as gay and be in a relationship as long as there is no intercourse
        5. Full equality

        The idea of celibate relationships doesn’t really work. Gay people try them, but still get condemned by (many) conservatives and/or disbelieved. So the individuals involved have to be as committed to their beliefs as couples who believe full marriage should be open to them.

        There was an attempt to have a regular conference for such couples in the States but it got denounced by conservatives pretty quickly and collapsed

        • Don’t want to take this thread further off topic – I’ve been dealing with this on my blog stevesfreechurchblog and also putting in my twopennorth here on Psephizo when same-sex relations are the topic. The one simple option is men loving men is fine, doing or being tempted to do gay sex is part of the disorder resulting from sin. Suggest you might respond further via my blog rather than on this thread.

    • Peter:
      EVERYBODY I know lends money at interest. Currently I am loaning out many thousands of pounds to my bank, which is paying me interest. My one complaint is that it is not paying me enough interest (4% on one year bonds).
      If you can help me get a higher rate, I will be indebted to you (morally speaking – at this stage in life I am avoiding debts).

      • Suppose you were to e.g. buy a house and rent it out instead. That’s not interest, that’s an investment — and allowed by the Bible. See the parable of the talents.

        • Rents have sky rocketed over the last few years (something that clergy often dont appreciate). Unless youre on a very good income, many simply cant afford them. And we often hear horror stories of people renting and then suddenly their rents increase sharply.

          Theres nothing wrong with a Christian buying and renting out a property. However, in my view, instead of trying to make as much as possible out of it by renting at the ‘going rate’ they should rent it for a reasonable amount (covering the mortgage costs etc as approp). In fact if more Christians or Christian-led companies did that, the housing market would not be going in the direction it’s going, another bust as in 2008.

          • The ‘going rate’ is determined by millions of people and I see nothing wrong with letting at it. What is immoral is treating the tenants you do have badly, because that is a personal relationship.

    • It is amazing that Ian continues to allow such ad hominem comments having said last week that he isn’t going to allow them anymore.

  2. I think the key point is the first that Dr Renz makes, that in ancient Israel (and parts of the ANE) there were debt forgiveness laws and that anti-usury legislation should not be taken in isolation from those – or the rest of the Pentateuch. A lot of lending in the pagan world was to buy land or slaves, and in ancient Israel there was not only a heavily legislated market in money but also in labour and land.

    By happy coincidence my present reading is Edward Chancellor’s history of interest, The Price of Time, to which one might add David Graeber’s superb book Debt: The first 5000 years. Interest is the means by which supply and demand are matched in markets for money, between lenders and borrowers, just as prices emerge so as to match supply and demand in commodity markets. Interest may be viewed as the price of time during which the lender’s use of his money is foregone, plus the price of risk of default. Chancellor makes a strong case that artificially low interest rates are the real cause of boom and bust cycles and that stormy weather lies ahead.

    Dr Renz outllines the history of Christian views on interest. Do Talmud, Maimonides and other post-Jesus Jewish commentators have anything to say on the reasons for what the Pentateuch permits and forbids?

  3. Interesting that another possible approach, based on the discussion about the land in Chris Wright’s ‘Old Testament Ethics for the People of God’ (thanks Ian for introducing me to that discussion many years ago) is not considered.

    That is that the ban on interest is a practical way of Israel demonstrating to the world an alternative economics based on the fact that God is the owner and provider of everything and reliance on him must be part of their economic life. Deuteronomy 8 and 15 spring to mind, together with the first fruits principle, the Jubilee and the seven yearly cycle of sabbath for the land and remission of debts. God has provided himself and the land and that is all they need. So there is no need to take interest from a fellow member of the people of God because it’s God’s money not yours and you are merely acting as God’s distributor of what is his anyway. I would also argue that the commandments not to steal or covet are expressions of the same principle, rather than, as every American book I’ve read on the subject says, a scriptural warrant for private property ownership! You don’t need what God has allocated to someone else because he is providing for you too. The weakness of that analysis lies in the fact that renting of property or goods is allowed (isn’t renting a payment for use of something that isn’t yours for a period of time?) but I believe that can be accounted for.

    If Chris Wright is right then the land in the New Testament is the fellowship of the family of believers, which gets us back to Thomas’ entirely correct point that what we ‘have’ is to supply our needs and anything we ‘have’ over and above that is to be used for the benefit of brothers and sisters who don’t have enough to meet their own needs. That is a primary method by which God fulfils his promises to meet everyone’s needs.

    Before anyone accuses me of idealistic economic naïveté I should say that I decided some years ago to test this approach in the real world and now have a significant sum of money lent to or invested in fairly risky businesses run by Christians as part of their holistic vision for local church mission. Loans are interest free and capital is not index-linked. God has so far proved faithful spiritually and financially.

    • Chris Wright’s book is excellent, as is the evangelical Christian and academic law lecturer Jonathan Burnsides’s book “God, Justice and Society” (2010). It is always worth asking *why* God gave the laws He did to ancient Israel, and the church has the mind of Christ to investigate it.

      I would disagree, though that “If Chris Wright is right then the land in the New Testament is the fellowship of the family of believers.” When the diciples asked Jesus if he was going to restore the kingdom, meaning in context to Eretz Israel, they clearly had the Jews in the Holy Land in mind. And where on this earth will Jesus come back in glory to, and why there (and then)?

    • define ‘needs’. Most Christians I know, incl clergy, take a foreign holiday every year, sometimes two if they also go skiing in the winter, and of course during the likes of the Easter hols stay somewhere more local though still costing a fair bit. Is such and similar spending a ‘need’ or extravagance?

  4. On usury have people looked at Muslim practice, where again there is a prohibition on lending at interest. It is probably fair comment that a lot of Muslim banking does really use interest but uses lots of fancy language to pretend it doesn’t. But a few years ago I came across a book from the American Muslim ‘Bank of Whittier’ where they really try to observe the rules and have some interesting ideas. One of which is that they try less to loan and more to ‘co-invest’ so that on the one hand they get a return from the success of a business but on the other hand they take the risk and are willing to take a loss rather than the demand for interest repayment automatically continuing after a business or venture has failed. Perhaps Christian banking could be set up parallel to the regular banks but with similar principles….

    Interestingly, BTW, in staff training they use the classic film “It’s a Wonderful Life” because although of course the banker there is conventionally charging interest they want to encourage his community-centred values.

  5. Ian,
    Apologies for going off topic on this important question but have you noticed that Colin Coward is claiming in ‘Thinking Anglicans ‘ that the Archbishops have decided (as they evidently have papal powes) to oause any implementation of ‘stand alone’ LLF and same sex marriage for clergy until an agreement has been made with parties in the Church of England who want to go alone and have their own episcopal oversight.
    If I have understood this correctly, Welby and Cottrell are now worried that they will lose the youngest and most active part of the C of E. If this is so pressure seems to be working. Playing hardball is tbe only way with heretics.

  6. Is it not interest as such but the *rate of interest* that is morally dubious? Looking at the extraordinary high interest rates charged by some lenders its not surprising why so many have unmanageable debt?
    In our church we had to borrow from the Baptist Union to make necessary improvements to our buildiñg. We were charged a nominal interest rate ( a few percent) above base and required to make a monetary contribution to the Baptist Missionary Society at the end of the loan. We achieved our building objectives, paid off the loan and gave some money back to the BMS despite being a small church with very few monied members.

    • It is common to say that usuary is ‘excessive interest’. However, what is ‘excessive’? Nehemiah (see 5:1-13) has to deal with the problem of those charging interest. It is “the hundreth part” (v11), i.e. one percent.

      These loans were to alleviate poverty in time of famine (v3). So, this does not necessarily exclude interest on a loan for business development.

  7. At the centre of the Gospel is an eternally, infinitely unpayable debt, Redeemed only by Jesus.
    Do we really know the cost, yet value not one drop…of His blood?

  8. See also the parable of the talents: “his master answered him, ‘You wicked and slothful servant! You knew that I reap where I have not sown and gather where I scattered no seed? Then you ought to have invested my money with the bankers, and at my coming I should have received what was my own with interest.” (Matt 25:26b-27)

    Basically: “you didn’t even SIN with my money [by lending out at interest]”

  9. I knew Thomas years ago in the Tyndale Fellowship, so it is good to know he is back teaching at Oak Hill. The question of usury has always been a thorny one in Christian history and no doubt helped stoke (further) anti-Jewish feeling. I’ve learned a good deal of Jewish history from Henry Abramson’s youtube channel, which jncluded the observation that under feudalism every Christian man and woman had a lord but Jews, being town dwellers, were anomalies in the feudal system and many were considered ‘servi camerae’ (servants of the King’s chamber). Jews were useful of course because they could loan money to needy monarchs.
    They could also loan money to farmers, and thereby problems could arise; for if a farmer’s crops failed, he might forfeit his property, and this would contribute to Judenhass among the peasantry.
    Many years ago, I concluded that loaning out at interest could not be intrinsically wrong if Jews were allowed under the Law to charge interest to Gentiles, and Jesus alluded to this in Matt 25.26-27.

    • James – there are two people of the name Thomas mentioned in the article – a chap named Thomas Aquinas who had quite a lot to say about usury – and Thomas Renz. With which of these are you acquainted from the Tyndale Fellowship?

      Yes – completely clear from Matthew 25:26-27 that interest (in the way that a bank pays to a customer) is not considered intrinsically wrong in Holy Scripture. One thing about the bank paying interest: if the bank actually goes into liquidation then you’re unlikely to get your interest. I think that passages such as Exodus 22:26 and Deuteronomy 24:13 probably give the basis on which one gives a loan (with or without interest).

      By the way – related to this, but not exactly the same – what do you think of the scam that Joseph pulled in the book of Genesis, whereby he took grain from farmers during the 7 years of plenty (there was a decree – and I didn’t see that the Egyptians were given much of a choice in complying with giving Pharaoh one fifth of their grain) and then sold their own grain back to them during the 7 years of famine at exorbitant rates – so that Pharaoh did really well out of the famine and became virtually the only land-owner in all of Egypt.

      This doesn’t seem to me to comply with the principles set out in Exodus and Deuteronomy.

      • Jock, he wasn’t just a Quinas, he was THE Quinas!
        Well, that’s what I thought. Then I began to have doubts about Thomas…
        As for Joseph’s clever investment in Egyptian grain futures, this was fine, just an early example of spoiling the Egyptians.

          • I’d be surprised if any schoolchildren today have heard of Thomas Aquinas, although his Five Ways used to be taught in Catholic schools at GCSE. The Catholic GCSE syllabus is now exceedingly insipid – and rigorously avoids tricky ethical issues. The national syllabus requires the study of Christianity and another religion. Perhaps wisely, Catholic GCSE RE avoids studying Islam and chooses Judaism instead. Other state schools I know of also avoid Islam and study Buddhism instead. So the only Islam English kids notionally study in schools is a bland sanitised version in Year 8, in Islamically approved textbooks, which rigorously avoids mention of the actual life of Muhammad or jihad.
            A level RE and Philosophy does include a reasonable discussion of Aquinas in the philosophy of religion section and in Virtue Ethics and synderesis.

          • It was Thomas Becket. The ‘à’ was a later addition, post-Reformation, perhaps to make the name more interest-ing. Sorry

        • James – yes – kindness and generosity towards those of the correct ancestry, while engaging in sharp practise – the sharper the better – against the stranger – is a major (and ugly) feature of the Pentateuch (c/f Deuteronomy 23:20). Looks like racial discrimination pure and simple to me. Well, following Joseph, it did come back to bite them on the bum several centuries later. The difficulties in which they found themselves under Pharaoh at the time of Moses were at least in part a result of the economic system that Joseph had developed – when just about all the land (except for land owned by the priests) was in the hands of Pharaoh.

          • Well, perhaps contemporary Christians would be much richer if they took the biblical teaching on usury more seriously – which is not to charge interest to someone who ‘makes the grade’ as a Christian (e.g. if Ian were to roll up asking us to lend him a dime – he’s a Christian, so we wouldn’t charge interest), but we’re allowed to fleece anybody who doesn’t make the grade (the grade obtained by a multiple choice test where one of the questions is about original sin).

  10. First, in reply to Jock, I would argue that Matthew 25:26-27 does not provide support for the view that interest is not viewed as intrinsically wrong by Scripture. The servant who has buried the talent did so because he ‘knew’ that his master was a ‘hard man’. So, the master replies, if you knew I was a hard man, that is someone who reaps where he does not sow, you should have placed the money on deposit to earn interest. In other words, Jesus is telling his hearers (though it is not the main point of the parable!) that the kind of people who expect interest on money are hard men who want something for nothing. That is hardly a ringing endorsement of the moral neutrality of interest.

    Second, and more generally, Thomas Renz approaches this topic from the perspective of an OT scholar. Some interesting work, seeking to explore the potential implications of the ban on usury, for contemporary economic and financial arrangements has been done from an economic perspective by Dr Paul Mills. If I recall correctly, his PhD in Economics from Cambridge University undertook a theoretical examination of the impact of a ban on interest for various types of economic model; he has subsequently worked for HM Treasury and the IMF.

    His work is interesting in at least two ways: first, he brings a different set of academic skills to the assessment of the implications of the ban on usury; secondly, one suspects that the ban on usury is often dismissed as being wildly impractical, and so irrelevant, but Paul Mills’ writing suggests that if you trace through the economic implications of a ban on interest, you become more attuned to the nature of the problems created by our reliance on debt-based finance.

    He has written a handful of ‘Cambridge Papers’ exploring (a) how Christians might seek to apply the ban on interest in making their own personal financial decisions and (b) the adverse impacts on financial markets and economic systems which can be traced to reliance on interest bearing commercial loans and (c) possible ways in which some aspects of our financial system could reflect the economic and commercial imperatives embedded within a ban on usury.

    These include some pre-2000 papers which can be found at

    * The Ban on Interest: Dead Letter or Radical Solution? (March 1993)
    * Investing as a Christian: Reaping where you have not sown? (June 1996)

    Following the global financial crisis in 2007-8, he wrote ‘The Global Financial Crisis: A biblical diagnosis (March 2011)’ which he summarised as follows: “The self-destructive tendency of a debt-based financial system has been highlighted in earlier Cambridge Papers. This lesson is being retaught with a vengeance by the current financial crisis. To diagnose our current plight, this paper expounds the biblical teaching on debt, interest, and finance; explains what is really going on from a relational perspective; and draws applications for the Christian, the church, and society.” This paper can be found at

  11. The foremost insight that I gain from this article is that what is condemned by God is what is now called ‘loan sharking’ – that is lending money to the poor with the aim of getting them more indebted than they were at the start, by applying an excessive interest rate – and in this context the loan shark’s rate can in effect be well over 1000% per annum – with the aim of leaving them totally destitute.

    This is different from the practice of charging a small amount of interest to cover the opportunity cost and risk of default on a loan intended to tide a poor person over a rough patch when there is reasonable expectation of that person regaining financial security and repaying the loan and interest on it.

    So there is not an absolutist answer to the question of the right or wrong of charging interest, it is a matter of judgement. This is just the same as the situation of determining where to draw the line between a modest and acceptable lifestyle for a Christian, and an excessively luxurious and unacceptable lifestyle – a question that has also come up in the comments.

    • As it is not possible to edit a comment, I need to post this reply in order to correct the second paragraph above, in which I used a bad example of what could be considered charging an acceptable level of interest. Lev.25:37 commands an interest-free loan to a fellow Israelite who is poor. But this would imply that charging interest on a loan to a fellow Israelite who is wealthy, or to a gentile is acceptable.

      • except that the previous verse refers to ‘foreigners and strangers’ which would presumably apply to Gentiles.

        Regardless, perhaps Christians should be better than what the OT law required? Just not charge interest at all…

  12. Along with discussing interest, we have to understand that Federal Reserve notes are not money. Dollars constantly inflate, stealing from everyone. If one borrows dollars, any interest rate less than the rate of inflation (the real rate, NOT the official rate) is not usury but is in fact stealing from the creditor.

  13. An issue evident in many of the above comments. When I address the issue of Christians collecting taxes, most people simply quote Jesus as commanding we pay them. In short, most people are incapable of seeing the difference between paying taxes and collecting them.
    Similarly, in much of the above discussion, some appear incapable of seeing any difference between paying usury and collecting it.


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