Christians and lending money

Lending to other Christians 
by Crown Financial Ministries

Christians and lending money
There is no record of a society that operated for any period of time without borrowing and lending. Our society is a very rare instance where the laws favor the borrowers over the lenders. 

So, lending is not a new principle. It is historically as old as man's written record. 

Christians should be concerned about two areas when it comes to lending money: (1) lending to Christians and not charging any interest at all, and (2) lending to non-Christians and charging a fair rate of interest. 

Since Scripture does not prohibit lending to another person, Christians can lend money both to Christians and to non-Christians. 

However, according to Luke 6:34-35, Christians should be willing to lend even to those who can never repay. "If you lend to those from whom you expect to receive, what credit is that to you? Even sinners lend to sinners in order to receive back the same amount. But love your enemies, and do good, and lend, expecting nothing in return; and your reward will be great, and you will be sons of the Most High; for He Himself is kind to ungrateful and evil men." 

This doesn't mean that Christians should indiscriminately lend money, but it does imply that they must be willing and able to lose it, if necessary. 

Even so, the obvious meaning of this passage is to give to those who have needs—regardless of whether they ever have the ability to repay or reciprocate. 

Charging interest
Although the implication throughout the Bible is that a loan can be made to anyone, there is little Scripture dealing with the specifics of lending and charging interest. 

However, what is recorded on the subject seems to be very clear: do not charge interest to your "brothers." "You shall not charge interest to your countrymen: interest on money, food, or anything that may be loaned at interest" (Deuteronomy 23:19). 

For a Christian to lend to another Christian and charge interest violates a basic principle of God's Word. Christians witness to others by their willingness to lend money to fellow Christians without profit. 

Although there is no such admonition against Christians charging interest to non-Christians, they are directed to avoid excessive amounts of interest and to be fair (see Philippians 2:3). 

Even though Christians are permitted by Scripture to charge interest on loans to non-believers, that does not mean a Christian has to charge interest. 

God may well convict someone to extend a loan at no interest as a testimony and a door-opener to be able to share the message of Christ. 

Consequently, Christians must seek the balance between being a good steward and being a good witness. 

Repayment of money lent
God's principles of lending and collecting do not require a Christian to sit passively by if someone refuses to pay what is due. However, neither do they allow Christians to use the devices of the world, such as collection agencies and lawsuits, to collect debts. 

Christians have the right to collect money owed but only under biblical guidelines. Nevertheless all means, short of a lawsuit, may be pursued in trying to resolve the situation. 

Since Christians are clearly admonished in Paul's first letter to the Corinthians (1 Corinthians 6:1) never to take another Christian before the secular court for any reason, if a Christian lender feels that a Christian debtor has the capacity to pay the money owed but refuses to pay, the lender should confront that person as prescribed in Matthew 18:15. 

This does not in any way involve collection of the debt but, rather, discipline in the faith to correct the "sin." 

There are boundaries within which Christians are to operate that are much narrower than those of the world. As a example, in Matthew 12:7, God says He desires compassion from His people more than He demands sacrifices of them. This means that when in doubt, lean more toward mercy than justice. 

If Christian debtors say they can't pay, a Christian financial counselor could act as a intermediary, to prepare a budget review for them, to determine exactly how much they can pay, and to have the debt adjusted accordingly, if necessary. 

However, once these options have been exhausted and the situation is still not resolved, God's Word teaches that the debts should be forgiven, written off, and forgotten, leaving the results in the hands of God. 

There are four simple guidelines that a Christian should understand with regard to lending: (1) Lend to anyone to whom God directs, expecting never to be repaid. The person who truly is in need will, in all probability, never be able to repay. (2) Do not charge fellow believers interest on money that is lent. It is permitted to charge non-believers interest but only if led by God to do so. (3) Do not sue anyone or use secular methods to collect money owed (see Luke 6:34-38). (4) A Christian must follow biblical principles and guidelines when dealing with a fellow believer who will not pay his or her debt to the lending Christian.