Riba vs. Usury in Medieval Times (and my opinion)
Usury in the Latin West and riba in the Muslim world are similar but have their differences. Essentially, they’re both interest on debts. Medieval Christians in Europe used the term “usury” unsparingly for all cases of interest while medieval Muslims in the East had several forms of riba.
Different Kinds of Riba in the Medieval Muslim World
Riba’ al-jali (open interest), riba’ al-khafi (disguised interest), riba’ al-fadl (interest due to extra payment), riba’ al-nasiah (interest due to late payment).
Medieval Riba Compared to Medieval Usury
While in the Christian context usury was nearly always frowned upon, Muslims permitted various forms of riba depending on the type of transaction between parties. For example, riba’ al-fadl was permitted if one party traded gold jewelry for gold bullion even though the weight was unequal because jewelry is arguably worth more than the other due to it having a higher function. But in money-changing riba’ al-fadl was prohibited because the weight of coins should be equal due to an equal function.
Usury, at least in the century of Thomas Aquinas, a Catholic Italian who the Muslims also studied, was treated with much less leniency. However, before usury hysteria in Europe, a Genoese contract of 1161 openly accepts usury. Then, a Florentine testamentary of 1395 shows what kind of punishments besides exile a usurer can face, such as repaying “any sums owing to absent creditors.” A decree from the Council of Lyons in 1274 goes as far as to condemn usurers to an improper burial, essentially stalling fellow Christians’ admittance to Heaven. Elsewhere, Gerard of Siena in the mid 14th century, on trade goods, writes “so long as their measure remains constant, their value remains constant.” Gerard uses Aristotelian reason to prove that usury is against the nature of the world God created.
Christians in the 13th and 14th centuries also saw interest as a sinful way to make money because it didn’t produce anything of value for other Christians. Despite the risk someone took for lending money, unlike in today’s moral standards, it was still seen as unfair to charge interest. This interest on payments (riba’ al-nasiah) in the Muslim world was also prohibited because it often lead to the immoral acquisition of the debtors’ property, much like how our modern banks take debtors’ houses away.
My Opinion on Riba and Usury in the Middle Ages
For the sake of such cases I agree with Muslims and Christians of the 13th and 14th centuries when they say usury can be an awful thing, but if the debtor is fully warned of all the stipulations before asking someone else for money then it can only be called fair. Even lenders today take up a huge risk for lending money to strangers, and arguably in medieval times this risk was higher because there was less policing, higher mortality rates, etc. If I was a Jew in 14th-century Venice I would certainly feel no shame in asking for a bit of interest on a loan, but I might not go as far as to take the debtor’s property away if they failed to pay on time. In the classic Robin Hood tales, an evil bishop purposely lends money to people who can’t pay it back so he can later take their property away and get even richer.
Extra medieval fact about Jews and usury: Since Jews weren’t Christian, they were able to get away with usury in many places, making them the perfect money-lenders. But this isn’t the only reason why Jews are still associated with money today. Even before Christian usury hysteria, William the Conqueror in the 11th century was the first to invite Jews to the British Isles because he needed them as financiers, for they were well known for their commercial skills, but his heirs only ended up taxing them to poverty before exiling them in order to fund their Christian wars.