The practice of lending at interest – known as usury – is at the heart of the modern banking system. It has been condemned by Jews, Christians and Muslims for most of their history.
An old argument against interest was that lenders were charging for the time that they did not have the money – and time belongs to God alone. It is also clear from the Hebrew Bible (the Old Testament) that people have long been aware of the harm that can be done by lenders who take advantage of people who desperately need money.
Views changed over time. In the eleventh century, attitudes to interest softened in western Europe as monarchs borrowed money to finance wars. Some of these were “holy wars” against Muslims, Jews and “heretics”, so some (but not all) Christian leaders were prepared to sanction usury to fund them. In the middle ages, many Jewish scholars argued that, while usury was unacceptable amongst Jews, it was OK for Jews to charge interest to Gentiles. Christian monarchs took advantage of this to borrow money from Jewish moneylenders – while also accusing them of usury at times of anti-Semitic scapegoating.
In the sixteenth century, most Protestant reformers accepted that interest could be charged if the rate was relatively low. The figure of 5% was commonly (if somewhat arbitrarily) given. It was backed by figures such as Martin Luther and John Calvin. Nowadays, a number of Christians (including the Archbishop of Canterbury, Justin Welby) use the term “usury” specifically to refer to lending at high rates of interest that go far beyond compensation for the lender’s time and inconvenience.