What about charging interest?

Question 12011

Charging interest has a long and awkward history in Christian ethics. For centuries the church treated it as sin outright, and Christians who lent at interest could find themselves excluded from communion. Today most believers hold a mortgage, a pension and a savings account without a flicker of conscience. Something has clearly shifted, and it is worth asking whether the shift was warranted.

The biblical material needs careful handling, because the texts are clear but their setting is specific. Reading them without attention to that setting produces either needless guilt or careless dismissal, and I have met plenty of both.

What the Mosaic law forbade

The prohibitions are direct. “If you lend money to any of my people with you who is poor, you shall not be like a moneylender to him, and you shall not exact interest from him” (Exodus 22:25). Leviticus expands it: “If your brother becomes poor and cannot maintain himself with you, you shall support him. Take no interest from him or profit” (Leviticus 25:35-37).

The Hebrew word is neshek, which carries the idea of a bite. That is a vivid piece of vocabulary. The image is of a loan that takes a piece out of the borrower, and the law forbids treating a neighbour’s desperation as an opportunity.

Notice the recurring qualifier in these texts. The person in view is poor, is a brother, and cannot maintain himself. This is not commercial finance. It is charity structured as a loan so that the recipient keeps his dignity, and charging interest on that is what the law calls a bite.

The foreigner clause and what it tells us

Deuteronomy adds a distinction that decides a great deal: “You shall not charge interest on loans to your brother, interest on money, interest on food, interest on anything that is lent for interest. You may charge a foreigner interest, but you may not charge your brother interest” (Deuteronomy 23:19-20).

If interest were inherently immoral, this permission would be incomprehensible. God does not license His people to commit sin against outsiders. The only coherent reading is that the prohibition targets a particular relationship and a particular situation, namely the exploitation of a needy member of the covenant community, rather than the concept of a return on capital.

The foreigner in view here is typically the travelling trader, someone borrowing for commerce rather than survival. A loan to fund a caravan is a different transaction from a loan to buy bread, and the law treats them differently. That distinction has done a lot of quiet work in Christian ethics ever since.

The prophets and the heart of the matter

The prophets return to this subject repeatedly, and always with the vulnerable in view. Ezekiel lists among the marks of a righteous man that he “does not lend at interest or take any profit” (Ezekiel 18:8), set in a catalogue of behaviours about oppression, robbery and feeding the hungry.

Nehemiah’s confrontation with the nobles is the sharpest example. Families were mortgaging fields and selling children into slavery to survive, while their fellow Israelites profited. Nehemiah’s response is furious: “The thing that you are doing is not good. Ought you not to walk in the fear of our God?” (Nehemiah 5:9). The sin was not arithmetic. It was the sight of brothers being consumed while brothers watched the returns.

What Jesus assumed about charging interest

The parable of the talents contains a detail that is easy to skim past. The master rebukes the servant who buried the money: “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” (Matthew 25:27). The parallel in Luke 19:23 says the same.

Jesus is not delivering a lecture on finance, and I would not build a doctrine on a parable’s furniture. But parables draw their force from familiar and unobjectionable realities. He would not have used a practice His hearers regarded as obviously wicked as the standard against which a servant is measured.

What Jesus does condemn, elsewhere and often, is the love of money and the exploitation of the weak. “You cannot serve God and money” (Matthew 6:24). The New Testament’s concern is not the mechanism of finance but the master a person is serving through it.

Why the church changed its mind

The medieval church, following Aristotle as much as Scripture, held that money is sterile and cannot properly produce more money. In an economy where almost all lending was to the desperate, the practical effect of that position was protective, and I have some sympathy with it.

What changed was the economy rather than the Bible. Once capital could genuinely be put to productive use, funding a voyage, a workshop, a farm, the picture altered. A borrower who uses money to generate a return and shares part of that return with the lender is not being bitten. Both parties gain, and the risk is shared.

That is why I do not think the modern Christian who holds a savings account is living in defiance of Scripture. The moral weight in these texts falls on the treatment of the vulnerable, and that weight has not shifted an inch.

Where charging interest still goes badly wrong

The principle bites hardest today in the market for high-cost credit. Doorstep lending, payday loans and certain subprime products routinely carry rates that trap the borrower rather than serve him. When a loan is structured so that the borrower can service it indefinitely without ever reducing it, we have arrived precisely where Nehemiah’s nobles were standing.

Amos condemned those who “trample on the needy and bring the poor of the land to an end” (Amos 8:4). Any Christian involved in lending, whether professionally or informally, should be asking whether the arrangement helps the borrower or feeds on him. That is not a question the interest rate alone can answer, but a rate that only desperation would accept is a strong clue.

Lending inside the family of God

The covenant dimension of these laws does carry over, though not as legislation. Within the church, the biblical instinct towards a brother or sister in need is generosity rather than commerce. “Give to the one who begs from you, and do not refuse the one who would borrow from you” (Matthew 5:42).

Jesus goes further: “Lend, expecting nothing in return” (Luke 6:35). I take that as freeing rather than binding. If you are able to help a believer in genuine hardship, treat it as a gift you are willing to lose rather than a debt you will chase, because the alternative has wrecked more friendships in more churches than I care to count.

That does not mean churches should be careless. Money lent without wisdom can subsidise a problem rather than solve it, and there are situations where the loving answer is practical help, budgeting support or honest conversation rather than cash. Generosity and discernment are companions.

Debt, mortgages and the borrower who pays

Most believers meet this subject from the other side of the table. We are not lending at interest; we are paying it. Scripture is sober about that position without forbidding it. “The rich rules over the poor, and the borrower is the slave of the lender” (Proverbs 22:7) is a description of how power works in a debt relationship, and it is worth hearing before signing anything.

A mortgage taken on a home you can afford, with a margin for the months when things go wrong, is a different creature from consumer debt taken to fund a lifestyle. The first is a considered use of charging interest by a lender to make ownership possible over time. The second is usually a way of pretending to be richer than we are, and it ends where pretending always ends.

Paul tells the Roman church to “owe no one anything, except to love each other” (Romans 13:8). I do not read that as an absolute ban on borrowing, since the surrounding verses are about paying what is due. I do read it as a settled attitude: obligations are to be met, promptly and fully, and a Christian who is casual about what he owes has a spiritual problem long before he has a financial one.

So, now what?

Charging interest is not sin in itself. The prohibition in the law targeted the exploitation of poor members of the covenant community, and the permission regarding foreigners shows that a return on capital was never treated as inherently corrupt. Fair commercial lending and ordinary saving are legitimate.

What has not changed is the fierce biblical concern for the vulnerable. So ask the questions Scripture asks. Is this arrangement fair? Is the borrower being treated as an image-bearer or as a revenue stream? Would I be content to be on the other side of it? And where a fellow believer is in real need, let the instinct be generosity rather than calculation. You may find whether debt is always wrong and what biblical stewardship involves helpful alongside this.

“If you lend money to any of my people with you who is poor, you shall not be like a moneylender to him, and you shall not exact interest from him.”

Exodus 22:25 (ESV)