The Good in Usury: How Exploitation Goes Both Ways
Economics are important. The Christian life doesn’t stop at the church doors, but subsumes everything under the One Lord Jesus Christ. And so, it is important for us to wrestle with and struggle with issues like usury. As a reminder, the biblical definition of usury is the sum paid for the use of money, hence interest; not, as in the modern sense, exorbitant interest.
My contention is that usury is not sinful, but is actually necessary to “protect our neighbor’s possessions and income,” as the Seventh Commandment teaches us.
1. Usury belongs to the civil law of Israel.
In catechism class, we teach that God’s law is threefold: the moral, ceremonial, and political (or civil) law. Under which of these categories does usury fall? Usury falls under the political law. God’s political law deals with provisions for everything from the duties of civil magistrates to the punishment of evil doers. Its purpose was to regulate the affairs of the civil government of the Jews and to separate God’s people from all the heathen nations. [1]
How do we know that usury falls under the civil law? We know it falls under the civil law by its particularism. While the moral law pertains to all men at all time, usury does not. “You shall not charge interest to your brother—interest on money or food or anything that is lent out at interest. To a foreigner you may charge interest, but to your brother you shall not charge interest, that the Lord your God may bless you in all to which you set your hand in the land which you are entering to possess.” (Deut. 23:19-20)
Like the ceremonial law, the political law of the Jews has been abolished in the New Testament. Its wise and wholesome provisions might well be studied by lawgivers of Christian countries, but it is no longer incumbent on any Christian ruler or nation to embody its provisions in their code of laws. Because usury falls under the political law, Christians are not sinning when they charge interest.
2. Anti-Usury Does not Accomplish its Purpose in Today’s Economy
Usury may be well and good when we deal with unbelievers. But should Christians impose an anti-usury law among themselves? In order to answer this question, we must understand the reason for such a prohibition. For what reason was the law against usury given by God? The reason is found under the seventh commandment: “We should fear and love God that we may not take our neighbor’s money or property, nor get them by false ware or dealing, but help him to improve and protect his property and business [that his means are preserved and his condition is improved].” [2] This purpose is clear from Exodus 22:25, Nehemiah 5, and Leviticus 25:35-38. We are not to impoverish or enslave our neighbor. Rather, we are to help and improve the means by which he lives.
Does a ban against usury fulfill the seventh commandment? While this would be beneficial to the borrower, I believe that a ban against usury or interest breaks the seventh commandment with respect to the lender. To not charge interest does not improve the lender’s property and business; in fact, it does not even preserve it.
How can I make such a claim? Doesn’t the lender receive the same amount of money back? No, he doesn’t. Look at the great change in currency over the last hundred years.
At one point, the United States and most countries, with the exception of China, were on the gold standard. The gold standard is a monetary system in which the value of a country’s currency is directly linked to gold. The purchasing power of gold is remarkably stable in the long term. An ounce of gold would buy the same basket of commodities in 1930 as it had bought in 1650. 3 With this sort of currency, a prohibition of usury makes sense. Over the long term, the purchasing power of what you lend will not go down. Your property is, at the very least, preserved.
This is not the reality of the dollar today. We have all experienced this with rising prices. A dollar in 1913 is worth $32.40 in 2025. The cumulative rate of inflation is 3140.4%. [4] Let us say I loaned someone $10,000 dollars in 2020. In 2025 money, that same loan is worth $12,394.95 with a cumulative inflation of 23.9% If I am only getting the dollar amount back, I am losing over two thousand dollars’ worth of purchasing power.
To not charge usury or interest today does not protect the lender’s money or property. His means not are preserved and his condition is not improved. Even if the amount of cash is the same, the purchasing power is not.
While it is fashionable for pastors to continually criticize the government, we ought not throw the baby out with the bath water. I agree with the federal government when it mandates a minimum interest rate on loans. This is the government’s job, after all. It is here to protect and preserve human life and the means by which life subsists, like money and commerce.
3. Lutheran Fathers Who speak of Interest in a Positive Way:
There are many quotes against usury from many historical sources, including Luther. But there are some of our Lutheran theologians who go beyond Luther and others by taking recourse to the Golden Rule. As Albrecht Peters, in His book on the Ten Commandments, writes: “Aegidius Hunnius and Johann Gerhard pointed to [the Golden Rule], not to prohibit the taking of interest, but to give a reason for giving interest. The person who has been enabled by a creditor to improve his possessions will, out of human equity and Christian love, return an appropriate share to his creditor. Thus credit business opens up working and planning in the future.” [5] I cite these men because it is good for us to know that “tradition” or “what the church has taught” on a particular subject is never as monolithic and unanimous as one might believe or portray.
4. Conclusion:
Usury falls under the political law and is not binding on us Christians. Laws against usury cannot be instituted in our economic system today because they would not protect or preserve the lender’s possessions and income, and are therefore unjust. This repristination is akin to reinstituting the law to leave the edges of your field for the poor (Leviticus 23:22). The purpose is to feed and care for the poor. But have you ever tried to eat field corn? I do not recommend it. Also, how many fields are in urban areas? Thus, a food bank or a benevolence fund better fulfills the purpose of these political laws.
Another issue we must tackle is avarice. I know things are tough in the world today. But if we are not careful, then the ninth commandment will be broken. Our neighbor’s inheritance or house will be taken "in a way which only appears right." Even Biblical law can be subverted in order to feed greed. Injustice is wrong, whether it is perpetrated against the rich or the poor. The Bible says: “The rich rules over the poor, And the borrower is servant to the lender.” (Proverbs 22:7) I heartily encourage you to save your money, to invest wisely, and to owe no one anything except love. But, if you are enslaved by debt, then be a good Christian slave as St. Paul teaches: “Let as many bondservants as are under the yoke count their own masters worthy of all honor, so that the name of God and His doctrine may not be blasphemed.” (1 Tim. 6:1)
Notes:
1 Bible History References, Vol. I, pg. 182.2 https://thebookofconcord.org/small-catechism/part-i/commandment-vii/
3 Grant, James. The Forgotten Depression. Quoting from Roy W. Jastram, The Golden Constant: the English and
American Experience. Page 28-29, footnote 13.
4 https://www.usinflationcalculator.com/
5 Peters, Albrecht, The Ten Commandments, pg. 279.