Can Christians charge one another interest?
Personal Questions | VBVM Staff | Jun-18-2010
Q. Is it a sin to charge other Christians interest on money borrowed? Leviticus says charging 10% interest is a sin.
A. There are several places in Scripture where God speaks specifically about lending money and charging interest, including Leviticus. Here is a sample of what the Lord says in His word:
You shall not wrong a stranger or oppress him, for you were strangers in the land of Egypt. You shall not afflict any widow or orphan. If you afflict him at all, and if he does cry out to Me, I will surely hear his cry; and My anger will be kindled, and I will kill you with the sword, and your wives shall become widows and your children fatherless. If you lend money to My people, to the poor among you, you are not to act as a creditor to him; you shall not charge him interest. If you ever take your neighbor's cloak as a pledge, you are to return it to him before the sun sets, for that is his only covering; it is his cloak for his body. What else shall he sleep in? And it shall come about that when he cries out to Me, I will hear him, for I am gracious. (Exodus 22:21-27)
Now in case a countryman of yours becomes poor and his means with regard to you falter, then you are to sustain him, like a stranger or a sojourner, that he may live with you. Do not take usurious interest from him, but revere your God, that your countryman may live with you. You shall not give him your silver at interest, nor your food for gain. I am the LORD your God, who brought you out of the land of Egypt to give you the land of Canaan and to be your God. If a countryman of yours becomes so poor with regard to you that he sells himself to you, you shall not subject him to a slave's service. He shall be with you as a hired man, as if he were a sojourner; he shall serve with you until the year of jubilee. He shall then go out from you, he and his sons with him, and shall go back to his family, that he may return to the property of his forefathers. For they are My servants whom I brought out from the land of Egypt; they are not to be sold in a slave sale. You shall not rule over him with severity, but are to revere your God. As for your male and female slaves whom you may have--you may acquire male and female slaves from the pagan nations that are around you. (Leviticus 25:35-44)
You shall not charge interest to your countrymen: interest on money, food, or anything that may be loaned at interest. You may charge interest to a foreigner, but to your countrymen you shall not charge interest, so that the LORD your God may bless you in all that you undertake in the land which you are about to enter to possess. (Deuteronomy 23:19-20)
LORD, who may abide in Your tent? Who may dwell on Your holy hill? He who walks with integrity, and works righteousness, And speaks truth in his heart. He does not slander with his tongue, Nor does evil to his neighbor, Nor takes up a reproach against his friend; In whose eyes a reprobate is despised, But who honors those who fear the LORD; He swears to his own hurt and does not change; He does not put out his money at interest, Nor does he take a bribe against the innocent He who does these things will never be shaken. (Psalm 15:1-5)
He who increases his wealth by interest and usury Gathers it for him who is gracious to the poor. (Proverbs 28:8)
But if a man is righteous and practices justice and righteousness, and does not eat at the mountain shrines or lift up his eyes to the idols of the house of Israel, or defile his neighbor's wife or approach a woman during her menstrual period--if a man does not oppress anyone, but restores to the debtor his pledge, does not commit robbery, but gives his bread to the hungry and covers the naked with clothing, if he does not lend money on interest or take increase, if he keeps his hand from iniquity and executes true justice between man and man, if he walks in My statutes and My ordinances so as to deal faithfully--he is righteous and will surely live," declares the Lord GOD. (Ezekiel 18:5-9)
And in the New Testament we find:
But his master answered and said to him, 'You wicked, lazy slave, you knew that I reap where I did not sow and gather where I scattered no seed. Then you ought to have put my money in the bank, and on my arrival I would have received my money back with interest. (Matthew 25:26-27)
First, as you can see, scripture does not give a specific number with respect to how much a person should charge for interest. Therefore, lending money at 10% would not necessarily be considered a sin under the Mosaic Law. Second, note that the commandment is that God's people not charge interest to one another. Charging interest to foreigners was acceptable (see Exodus 22:25; Deuteronomy 23:19-20).
From the above passages, then, we see that lending money with interest to fellow Jews (“countrymen”) would be sinful for a Jew under the Mosaic Law, but lending interest to a foreigner would not be sinful.
As Christians, however, we are not under the Mosaic Law. Rather, we are under the Law of Christ (1Corinthians 9:21; Galatians 6:2). While there is significant overlap in the Mosaic Law and the Law of Christ, there is no specific commandment in the New Testament for Christians to refrain from charging one another interest. Therefore, we cannot say on the authority of scripture that it is wrong or sinful to charge interest in a fair and legal manner, whether to another believer or to an unbeliever.
However, when we look at the instructions concerning interest found in the Old Testament, we see God concerned with the plight of the poor, and particularly when the poor do not receive assistance from their brethren. If a poor Jew suffered a bad crop or became ill or suffered a financial loss, he might not have enough income to support himself or his family. Under those circumstances, he must turn to his countrymen for a loan to get him through a difficult time. If his Jewish brethren charged him interest on the loan, especially a usurious rate (i.e., a very high rate of interest), it would only hasten the poor Jew's to fall into poverty.
So God, in concern over such circumstances, gave the Law against charging interest for Jews, which can be seen most clearly in Leviticus 25:35-36:
Now in case a countryman of yours becomes poor and his means with regard to you falter, then you are to sustain him, like a stranger or a sojourner, that he may live with you. Do not take usurious interest from him, but revere your God, that your countryman may live with you.
Likewise, Christians are called to assist our poorer brothers and sisters in Christ by being generous with what we have. Paul, writing to the Galatians about his mission to take the gospel to the Gentiles, says this:
They [the apostles in Jerusalem] only asked us to remember the poor--the very thing I also was eager to do. (Galatians 2:10)
Also, James 2:1-13 probably gives us one of the best explanations as to why we should help our poor brother or sister in need.
My brethren, do not hold your faith in our glorious Lord Jesus Christ with an attitude of personal favoritism. For if a man comes into your assembly with a gold ring and dressed in fine clothes, and there also comes in a poor man in dirty clothes, and you pay special attention to the one who is wearing the fine clothes, and say, "You sit here in a good place," and you say to the poor man, "You stand over there, or sit down by my footstool," have you not made distinctions among yourselves, and become judges with evil motives? 5Listen, my beloved brethren: did not God choose the poor of this world to be rich in faith and heirs of the kingdom which He promised to those who love Him? But you have dishonored the poor man. Is it not the rich who oppress you and personally drag you into court? Do they not blaspheme the fair name by which you have been called? If, however, you are fulfilling the royal law according to the Scripture, "YOU SHALL LOVE YOUR NEIGHBOR AS YOURSELF," you are doing well. But if you show partiality, you are committing sin and are convicted by the law as transgressors. For whoever keeps the whole law and yet stumbles in one point, he has become guilty of all. For He who said, "DO NOT COMMIT ADULTERY," also said, "DO NOT COMMIT MURDER." Now if you do not commit adultery, but do commit murder, you have become a transgressor of the law. So speak and so act as those who are to be judged by the law of liberty. For judgment will be merciless to one who has shown no mercy; mercy triumphs over judgment.
As you can see, James tells us to fulfill the “royal law," which he says is loving our neighbor as we love ourselves. By doing so, we are fulfilling the law of liberty (another name for the Law of Christ). This means we are to “speak and act as those who are to be judged by the law of liberty," which means we are to show mercy to our brothers and sisters in Christ. Note that our judgment will not be for condemnation (Romans 8:1), but for reward (1 Corinthians 3:10-15).
While there is no prohibition in Scripture to charging interest (as even Jesus indicates in Matthew 25 above), we should always act with sensitivity and compassion when loaning money to people in desperate need. Generally speaking, a compassionate Christian should consider loaning money with low or no interest (or even making the loan a gift with no expectation of repayment) when circumstances warrant charity. Again, this is not to say we may never loan money and charge interest to a poor person, but we should look for ways to demonstrate charity and love to others (especially fellow believers) rather than look for ways to enrich ourselves.
Jesus teaches this principle in the parable of the good Samaritan (Luke 10:30-37). In answering the question “Who is my neighbor?", Jesus taught that anyone who needs our help is our neighbor, and more importantly, Jesus showed us what loving our neighbor looks like. The Samaritan didn't know the injured man in the parable, yet he gives the man whatever he needs to care for his needs.
That is an example of loving our neighbor as we love ourselves, for surely we would want someone to help us in the same way if we were the injured man in the parable. Likewise, if we have the opportunity to lend money to someone who may have fallen on hard times, we should seek to do for them what we would like to have been done for us in the same situation.
What we would want if we the one in need? By choosing to serve the needs of others above ourselves, we can demonstrate the love of Christ exemplified by the parable of the Good Samaritan. Selflessness gives glory to God and may even become an opportunity for God to bring someone into His kingdom through a demonstration of Christ's love.