Re: Did the Church Change its Mind on Usury?
Did the Catholic Church change its teaching on usury?
Scripture, the Fathers of the Church, the decrees of councils and popes condemn the taking of interest on loans to the poor and the greed of usurers, but say nothing about the charging of interest in general.
Deuteronomy 23:20: "You may charge interest to a foreigner," indicating that interest-taking is not presented as inherently evil or sinful. The larger ethical issue of the morality of interest-taking is not addressed in the Old Testament. Rather, interest was viewed only as a problem of social justice. The problem of commutative justice, i.e., of equivalence of value in an exchange of present for future goods, remained quite untouched (Thomas F. Divine, S.J., Interest, 10).
With free enterprise as developed by the Catholic Late Scholastics, the Church defined what is meant by usury. Session X of the Fifth Lateran Council (1515) gave its exact meaning: "For that is the real meaning of usury: when, from its use, a thing which produces nothing is applied to the acquiring of gain and profit without any work, any expense or any risk."
Consequently, as loaning money did involve loss of profit to the lender and further risk of loss from delay in returning the money loaned, this did justify interest that is just and justifiable.
The Franciscan St. Bernardine of Siena (1380-1444) was perhaps the first theologian to recognize that time of use had an economic value and, at least in certain cases, might be licitly compensated. St. Antoninus (1389-1459), a Dominican of Florence, seems to have questioned whether Aristotle was correct in saying that money is naturally sterile. Money alone, he said, is sterile, but, combined with knowledge and enterprise, it is fruitful. His Summa Moralis examined commerce and banking, and prepared the way for modern notions of interest, which generally regard proper returns on loans taken with just title as fair.
Today, the term "usury" is usually reserved for taking excessive (i.e., unusually high for the economic conditions) interest on a loan because of someone’s circumstances: The greed of the lender takes unjust advantage of the weakness or ignorance of the borrower. [See Encyclopedia of Catholic Doctrine, Our Sunday Visitor].