Usury, Loan Sharking, and High Interest Rates

Charles G. Mills

12/25/2009

Usury is an offense against justice. It consists in receiving or demanding interest unjustly on a personal loan. Its worst form is “loan sharking,” the lending of money at interest rates like 600 percent, with a threat of violence to enforce payment.

There are at least two criteria for usury. First, the loan must be personal. Moral theologians have recognized for centuries that interest is a legitimate way to share in the anticipated profits from a business loan. Accordingly, a number of civil laws against usury do not apply to loans made to corporations.

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