post-Talmudic rabbis take up the question. Moses Maimonides,^13 in his
greatJewishlegalcode(LawsofLoans,chapter5,law2),rulesthatitis
permissible for a Jew to charge interest to a non-Jew only when there is a
dire need and in the amount necessary to provide himself with a basic living.
To charge a usurious (higher than normal) rate is prohibited. The great rab-
bis of medieval France and Germany were somewhat more permissive un-
der circumstances in which Jews were barred from most professions, and
Jewish communities were singled out for taxation above the ordinary rates
(commentary of Tosafot to Bava Metzia 70b).
Business Financing
In the 16th century, as life became much less agrarian and much more com-
mercial, loans were no longer primarily extended for personal reasons, but
rather to provide commercial capital. As these kinds of loans were vital for
commercial success and were not the kinds of loans first envisioned by the
Torah, efforts were made to find a permissible vehicle for this kind of
enterprise.
Rabbis in Poland and subsequentlyin other parts of Eastern Europe
drafted and refined a document calledheter iska. The essence of this docu-
ment is to transform the lender-borrower relationship into an investment
relationship. The provider of the capital becomes a partner in the venture in
which the borrower will be engaging; the borrower will share a specified
percentage of the realized profits with the lender/investor. This technical re-
definition of the loan as an investment allowed Jewish commercial enter-
prises to succeed without violating the laws of prohibiting the charging of
interest. Theheter iskawas refined several times to help ensure that the
lender/investor would not be exposing himself to an unacceptable level of
risk and that some measure of return would be contractually guaranteed.
Theheter iskais in common use to this day.
THE CHARGING OF RIBIT (INTEREST) IN
THE ROMAN CATHOLIC TRADITION^14 :
THEN AND NOW^15
Professor Christopher Kaczor teaches at Loyola Marymount University in
Los Angeles, California. The Board of Directors of LARIBA contracted him
in March 2002 to author a paper that summarizes the prohibition of charg-
ing interest on loans in the Roman Catholic tradition, with an eye toward
the history of the relaxation of the original prohibition. The following is an
abbreviated summary of his work.^16
The Faith-Based Judeo-Christian-Islamic Foundation 23