We Have Got to Talk About Usury (Part IX): The Medieval Church Continued—Councils, Canon Law, Dante, and Other Matters
St. Bernard at the Second Lateran Council, from the cloister of the Cistercian monastery of Altenberg, c. 1520, Museum Schnütgen, Cologne.
The following post is the ninth in a series on usury by the Rev. Vincent Shemwell. Rev. Shemwell serves as pastor of Bethlehem Lutheran Church in Johnson City, Tennessee. He graduated from Concordia Theological Seminary in Fort Wayne with the M.Div. in 2022, and received his STM from CTSFW in 2024, writing his thesis on Johann Georg Hamann. The previous installments can be found below:
Part I: Introduction
Part II: The Old Testament
Part III: The New Testament
Part IV: The Church Fathers—Clement of Alexandria through Hilary of Poitiers
Part V: The Church Fathers — The Cappadocians
Part VI: The Church Fathers — Church Councils and Ambrose
Part VII: The Church Fathers—Chrysostom through Leo the Great
Part VIII: Medieval Theologians
In the preceding part of our series, we dealt with several prominent medieval theologians on the subject of usury, spanning the eleventh through the thirteenth centuries. We will now back up in order to quote the canons of certain relevant church councils, as well as some papal decrees.
Second Lateran Council (1139), Canon 13: “Furthermore, we condemn that practice regarded as vile and reprehensible by both divine and human law, and denounced by Holy Scripture in both the Old and New Testaments, namely, the rapacious greed of usurers. We exclude them from every comfort of the church, forbidding any archbishop, bishop, abbot of any order, or anyone in clerical office whatsoever to dare to receive them, except with the utmost caution. Let them, moreover, be held infamous throughout the whole of their lives and, unless they repent, be deprived of Christian burial.”
In the fifth century, Leo the Great in Nec hoc quoque had prohibited all Christians from charging interest. By the twelfth century, this became an utterly explicit excommunicable offense. Usurers were not only to be removed from the church, they were to be shunned, held as “infamous,” and denied burial unless they repented. What is more, in this canon of the council, both Testaments are cited as proof of the binding moral prohibition against lending at interest.
Third Lateran Council (1179), Canon 25: “Because the crime of usury has so increased in nearly all places that many, neglecting other business, practice usury as if it were permitted, and pay no heed at all to how it is condemned in both the Old and New Testaments, therefore we decree that manifest usurers shall neither be admitted to the Sacrament of the Altar nor receive a Christian burial if they have died in this sin, and that no one shall accept their offering. But whoever does accept it, or gives them a Christian burial, shall be compelled to return what he has received and shall remain suspended from the performance of his office until he has made satisfaction at the discretion of his bishop.”
Despite what was decided at the Second Lateran Council, the practice of usury evidently persisted. Accordingly, in 1179 it was once more treated as an excommunicable offense, and the clergy were warned with even greater severity of the consequences for neglecting to excommunicate and shun usurers.
Around this same time, the palea entitled Ejiciens, which was mistakenly attributed to Chrysostom, was added to canon law by Gratian, in what is called the Decretum Gratiani. The palea reads as follows: “Above all other merchants, the usurer is the one most accursed, for he sells what was given by God, not something acquired, as a true merchant does. And after his usury he demands back not only what he claims as his own but also the goods of others along with his own; whereas the merchant does not demand back what he has already sold. Still, someone objects: ‘He who rents a field so as to receive rent from it, or a house so as to receive rental payments, is he not similar to one who lends money at usury?’ By no means. First of all, because money is appointed for no use except for exchange; secondly, because one who has a field gains fruit from it by plowing, and one who has a house takes from it the use of dwelling within it. Therefore, he who rents a field or a house is seen to be giving up his own use to receive money in return, and in a certain manner, he is seen to be exchanging profit for profit; but from money stored up you derive no use. Thirdly, a field or a house grows old with use. Money, however, when it has been lent, is neither diminished nor worn out.”
Several observations are in order here. In the twelfth century, the Aristotelian notion that money is sterile, incapable of bearing fruit of itself, and is naturally consumed in use was incorporated into canon law. In the palea under discussion, we further encounter the assertion that the usurer attempts to sell what properly belongs to God. Although not stated directly here, many scholars understand this to mean that the usurer presumes to sell time. One objection raised in this period held that in lending money at interest, it is not actually the use of the money that merits remuneration, but the interval of time between the issuing of a loan and its repayment. According to this reasoning, the lender effectively sells his claim on time: the borrower enjoys the advantage of immediate use of the money, while the lender surrenders the ability to use the money in the present and must wait until repayment. It is precisely this period of waiting, it was argued, that justifies the exaction of interest. Yet medieval theologians almost uniformly repudiated such reasoning on the grounds that time belongs to God alone. Thus Thomas Chobham, in his Summa Confessorum (art. 7, dist. 6, q. XIa, De usura), writes: “The moneylender sells nothing to the debtor that is his own, but only time, which belongs to God alone. Hence, because he sells what is another’s, he ought not to have any profit from it.” For Thomas Chobham, as for the author of this palea, to profit off the sale of time through interest is effectively to rob from God Himself, an offense against both the first and the seventh commandments.
It should also be noted that, in this period, it was assumed that money is not diminished or devalued by its use (that is, it is consumed in use, it changes hands, but the money itself does not lose its value). Of course, this conviction was bound to the economic realities of the Middle Ages. Given both the lapse of time between the issuance of a loan and its repayment, and the fluctuating value inherent in modern fiat currency, such an argument may no longer hold in our day.
In the epistolary decretal Consuluit of 1186, for the first time in canon law, a pope, Urban III, interpreted Christ’s words in particular as prohibiting all lending at interest. He writes: “Your inquiry seeks to determine whether, in the judgment of souls, one ought to be regarded as a usurer who, being otherwise unwilling to lend, lends his money with this intention: that, although a formal agreement is absent, he will nevertheless receive more than the principal in some way, shape, or form; and whether he is equally guilty who, as it is commonly said, will not otherwise grant a similar pledge unless, though without direct payment, he obtains some profit from it; and whether that merchant should likewise be condemned to the same penalty who offers his goods at a far higher price if a longer extension of time for making payment is granted, than if the price were paid to him immediately. Yet, since the Gospel of Luke clearly settles what must be held in such cases, where it is written, ‘Lend, expecting nothing in return’ (Luke 6:35), such men must be judged culpable for the intention of gain which they harbor, for all usury and excess are forbidden by law; and they must, in the judgment of souls, be firmly compelled to restore whatever has been thus acquired.”
That the Gospel prohibits usury was already strongly implied centuries before in Canon 13 of the Synod of Carthage (c. 348). But here, Urban III makes it abundantly clear that Jesus in Luke 6 condemns all lending at interest, along with the very intention of expecting more in return. For Luther and Walther as well, this was the key text for understanding the moral prohibition against usury.
Now since usury was formally prohibited to Christians, the practice of moneylending in medieval Europe was taken up predominantly by Jews, who generally regarded the Mosaic allowance concerning the foreigner (Deuteronomy 23:20) as still applicable. So, while interest could not be charged to a fellow Jew, it was permissible when dealing with Gentiles. This arrangement, however, gave rise to deep tensions and enduring animosity between religious Jews and Christians throughout the Middle Ages. The complexities of that history lie beyond the scope of the present discussion, yet the point must be acknowledged in order to make sense of the following canon.
Fourth Lateran Council (1215), Canon 67: “On the Usury of the Jews: The more the Christian religion is restrained from usurious practices, the more gravely the treachery of the Jews grows in this matter, to such an extent that in a short time they have already begun to drain the resources of Christians. Therefore, wishing in this matter to provide for Christians, lest they be cruelly burdened by the Jews, we ordain by synodal decree that if henceforth, under any pretext whatsoever, the Jews shall have extorted from Christians heavy and immoderate usuries, association with Christians shall be withdrawn from them until they have adequately made satisfaction for the excessive burden. Christians likewise, if need be, shall be compelled by ecclesiastical censure, without the possibility of appeal, to abstain from commerce with them. We furthermore enjoin princes that, on this account, they are not to be hostile toward Christians, but rather should endeavor to restrain the Jews from such excessive oppression. And by the same penalty we decree that Jews shall be compelled to make satisfaction to the churches for the tithes and offerings owed, which they were accustomed to receive from Christians from houses and other possessions before they had, under any title, passed into the hands of the Jews, so that in this way the churches may be preserved from loss.”
In this canon, we see that the thirteenth-century church interpreted usury by those outside the faith as a sort of necessary evil (otherwise, arguably, they would have advocated the practice being outlawed altogether in Christian lands). Yet even within this concession, strict boundaries were imposed to restrict the degree of extortion that could be exercised through interest; and in cases where usurers went beyond these boundaries, restitution was demanded.
In the following century, Pope Clement V, at the Council of Vienne, extended the severity of ecclesiastical censure by threatening excommunication not only upon those who exacted interest, but even upon authorities who tolerated such practices within their jurisdictions, while at the same time nullifying any secular laws that afforded protection to usurers. Additionally, this council condemned as heretical anyone who dared to claim that lending at interest is not a sin.
Council of Vienne (1311–1312), Decree 29: “Grave reports have reached us that, in certain places, communities, acting to the offense of God and the detriment of their neighbor, and in violation of both divine and human law, approve of usury. By statutes, sometimes confirmed by oath, they not only permit that usury be demanded and paid, but even deliberately compel debtors to pay it. Through these statutes they impose onerous burdens upon those claiming the return of usurious payments, employing diverse pretexts and cunning artifices to obstruct their recovery. Therefore, desiring to eradicate these pernicious abuses, we, with the approval of this sacred council, decree that all magistrates, captains, rulers, consuls, judges, counsellors, and any other officials of such communities, who henceforth presume to make, write, or dictate such statutes, or who knowingly decree that usury be paid or, if paid, that it not be fully and freely restored when claimed by a debtor, shall incur the sentence of excommunication. The same penalty shall apply to any who, having the authority, fail within three months to expunge from their community records such statutes already promulgated, or who presume in any manner to continue observing these statutes or customs. Moreover, since moneylenders so often engage in usurious contracts with such secrecy and deceit that they are scarcely convicted, we decree that they shall be compelled, under ecclesiastical censure, to open their account books whenever the question of usury arises. Finally, if anyone should fall into the error of obstinately asserting that the practice of usury is not sinful, we decree that he is to be punished as a heretic; and we strictly charge local ordinaries and inquisitors of heresy to proceed against all those whom they find suspect of such error as they would against those suspected of heresy itself.”
Thus, by the early fourteenth century, usury had come to be regarded as an excommunicable offense, not only for usurers themselves but also for their accomplices within civil government, and even the theological defense of the practice was classified as—at the very least—tantamount to heresy, likewise incurring the penalty of excommunication. At this point in history, the church defined usury as any demand beyond the return of the principal, grounding this definition in both the Old and New Testaments. Where usury had been committed but thereafter repented of, reconciliation required restitution, that is, any unlawful interest had to be restored to the borrower.
Within the theology of the medieval church, limited exceptions were occasionally permitted to the otherwise absolute prohibition of usury. One such exception was the concept of interesse, adopted by canon lawyers and theologians as a narrow allowance under specific conditions. While it remained forbidden to demand payment for the mere use of money, a lender might legitimately claim interesse if he could prove that he had sustained an actual, extrinsic loss or had been deprived of a lawful gain he otherwise would have secured. In such cases, interesse was understood not as a fee for the use of money itself, but as a justifiable indemnity for damages suffered as a result of the loan, its default, or delayed payment. Even so, the doctrine was fraught with controversy, since many recognized its potential to serve as a thinly veiled pretext for usury. Aquinas himself acknowledged the legitimacy of interesse only insofar as it corresponded to genuine and readily demonstrable losses.
In order to safeguard against the abuse of such exceptions, medieval theologians frequently distinguished between what they termed the “two sins” of usury. The first was the sinful expectation of receiving back more than had been lent, which Christ explicitly forbids in Luke 6. The second was the actual receipt of any excess. The former was primarily regarded as a sin against God, a violation of the first commandment, while the latter was understood as a sin against one’s neighbor, a transgression of the seventh commandment.
As noted earlier, one objection raised in this period was the argument that what warrants remuneration in lending is not the use of money itself but rather the element of time. A related argument proposed that it is the labor of the usurer which merits compensation, for while time belongs to God, one’s labor is presumed to be one’s own. Yet the predominance of medieval theologians also rejected this reasoning. According to their judgment, it is plainly the labor of the borrower, not the lender, that is truly at stake in lending. The usurer was then commonly regarded as an idler, far from one who toils; hence no genuine labor could be identified that would justify any financial reward. Indeed, it is the borrower who usually bears the burden of work and sweat, in accordance with Genesis 3:19. Thus, the borrower is the one in danger of being extorted. Or so medieval theologians reasoned.
At this point, I would like to quote one more medieval thinker, though of a different kind, for our series should not be confined exclusively to theologians and the decrees of councils. In this era, one of the most influential voices was not an ecclesiastical authority at all, but an Italian poet. Dante Alighieri (1265–1321), in the first part of his Divine Comedy, the Inferno, by far the most widely read portion of the work, renders a merciless judgment upon usury and usurers. He consigns them to the final ring of the seventh circle of hell, together with blasphemers and sodomites, where they forever endure a rain of fire and the scorching sands of the desert. For Dante, these three classes of sinners are bound together in damnation by their common transgression against nature: blasphemy against God and the truth of His Word, sodomy against the flesh and the created order, and usury against both human labor and the telos of money. Indeed, he even intimates an inverted connection between sodomy and usury, the one rendering sterile what is naturally generative (through homosexual intercourse), and the other seeking to generate from what is by nature sterile. In Canto XI, Dante characterizes the usurer’s distorted, counternatural faith with these words: “And as the usurer takes another course, Nature both in herself and in her follower he scorneth, since in something else he trusts.”
Despite the persistent theological and literary denunciations of usury, the practice, perhaps unsurprisingly, often continued quite unabated throughout the Middle Ages. The church’s absolute prohibition was unevenly applied and, in many quarters, seemingly ignored. Excommunication, although formally threatened, regularly remained little more than that: a threat. Secular authorities occasionally tolerated the practice, or at least failed to take meaningful steps against moneylenders who easily circumvented the ban. Usurers concealed their gains by disguising interest as fees, cloaking it under the pretense of currency exchange or legal fictions, or extracting so-called “gifts” from borrowers that were hardly voluntary. The interesse loophole was notoriously exploited despite repeated attempts by the church’s theologians to restrain it. Nor was the church herself blameless, for she was often complicit in outsourcing the work of moneylending to unbelievers, mostly religious Jews, as well as in tacitly condoning the phenomenon of Court Jewry. Out of this somewhat schizophrenic environment arose the great banking houses of Italy and elsewhere, ushering in nothing less than the birth of modern banking.
Eventually, in the fifteenth century, as a purported remedy against the exploitation of Christians by usurers outside the church, the medieval prohibition of interest was effectively challenged by the establishment of montes pietatis, institutions led by Franciscans which provided credit to the poor upon the security of pawned goods. Although largely sustained by charitable donations, they often imposed very modest interest rates, justified as necessary to cover administrative costs rather than to generate profit. Initially, many theologians rejected these institutions, principally based on the Lord’s command to lend expecting nothing in return (Luke 6). Yet proponents argued that such fees were necessary if the needy were to be spared the harsher exactions of private moneylenders, and that what was offered at the close of a loan in the form of charitable compensation might likewise be permitted at the outset, provided the end result be the protection of the poor. Montes pietatis thus represented the first non-profit ecclesiastical banks. In due course, however, this allowance was abused, and other institutions cropped up that took much more than was required for institutional maintenance. Nonetheless, at the Fifth Lateran Council (1512–1517) these charitable banks were formally sanctioned as a lesser evil, though the council simultaneously exhorted them to increase their reliance on donations so as to assist the poor without any charge at all, an arrangement deemed much more faithful to the command of Christ in Luke 6.
In the very year the council concluded, Martin Luther made public his Ninety-Five Theses. Many had hoped, Luther among them, that this council would initiate genuine reform. Instead, it sanctioned not only ecclesiastical moneylending but also the regulated sale of indulgences. The subsequent course of events is well known. While Luther’s foremost concern was the reform of theology, his critique was never confined to spiritual subjects alone, and as it happens, he had much to say about economic matters. And so he carried forward the patristic and medieval opposition to usury, but with a renewed and sharpened vigor.
God willing, we will get to our blessed reformer next time.
Stay tuned.