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Concept
Loans and interest in Judaism
Summary
The subject of loans and interest in Judaism has a long and complex history. In the Hebrew Bible, the Book of Ezekiel classifies the charging of interest among the worst sins, denouncing it as an abomination and metaphorically portraying usurers as people who have shed the borrower's blood. The Talmud dwells on Ezekiel's condemnation of charging interest.
The Torah and Talmud encourage lending money without interest. But the halakha (Jewish law) that prescribes interest-free loans applies to loans made to other Jews, however not exclusively. Rabbi Isaac Abarbanel, however, declared that the acceptance of interest from non-Jews does not apply to Christians or Muslims, as their faith systems are also Abrahamic and therefore share a common ethical basis.
The biblical Hebrew terms for interest are neshekh (נשך), literally meaning a bite, and marbit or tarbit (מרבית/תרבית), which refers to the lender's profit. Neshekh refers to interest deducted in advance from the loaned money given to the borrower; the words marbit and tarbit refer to interest added to the amount that the borrower must repay. The words marbit and tarbit, for the form of interest most familiar in modern times, became ribbit (ריבית) in modern Hebrew. The latter word is similar to the Arabic word riba used in the Quran.
The Torah expresses regulations against the charging of interest in , , and . In Leviticus, loans themselves are encouraged, whether of money or food, emphasizing that they enable the poor to regain their independence. Like the other two places in the Bible, the charging of interest on the loan is forbidden.
Evidently the concept of secured loans existed, as Exodus expressly prohibits using a particular garment as the security. The garment in question was a large cloth square, which the poor used for sleeping within, and so the garment was needed to survive the cold nights; if it had been offered as security, this would have put at risk the very life of the debtor.
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