Proverbs 28:8: “Whoever increases wealth by taking interest or profit from the poor amasses it for another, who will be kind to the poor.”
Unmanageable debt is always unadvisable. Even in old times, people avoided debt as much as possible. In the Bible, debt is regarded as a sin since you serve two masters when you are in debt. And, you need to have only one master – God. Therefore, it is better to avoid unmanageable debt and repay debt as early as possible.
According to the Bible, the borrower is a slave to the lender. When you are in debt, the sooner you can solve debt problems, the better. By doing so, you can serve God wholeheartedly.
However, this is for the debtors. There are certain things for the lenders and creditors as well. The old testament had put a complete ban on interest and loans. It condemns the practice of charging interest on the poor since giving out a loan is an act of compassion and taking care of others, your neighbors. The following quote will make this point clear.
Exodus 22:25 ESV: “If you lend money to any of my people with you who is poor, you shall not be like a moneylender to him, and you shall not exact interest from him.”
It means if you, a lender, lend money to a person who is poor and not capable of paying back, do not pursue him/her to pay back interest. Think that you have donated the money to a poor person who needed it.
The loan should act as compassion and a means to take care of your neighbors. Making a profit from a poor person’s loan is exploiting him. Likewise, charging interest and pledging something for a loan is not recommended.
During the early stages of financial education, a child is taught to save money to donate. Donating to others is a great way to serve God. By doing so, children learn the value of saving and contributing as a part of their responsibilities.
Leviticus 25:35-37: “ If your brother becomes poor and cannot maintain himself with you, you shall support him as though he were a stranger and a sojourner, and he shall live with you.  Take no interest [nešek] from him or profit, but fear your God, that your brother may live beside you.  You shall not lend him your money at interest [nešek], nor give him your food for profit.”
It stresses showing your kindness to your poor brother(s). If your brother becomes poor and can’t maintain a similar lifestyle, you should support him as a brother. You should lend him the required amount that he needs to sustain himself. However, you should not charge any interest from him but show your love and lend the money to help him overcome his financial crisis.
Moreover, it is mentioned in the later verses that if your brother sells himself to you, you should not enslave him. Instead, extend your brotherly love and help him.
Even in the present times, a person in debt can take help from family and friends and avoid taking out high-interest payday loans. However, they are supposed to pay back the amount to prevent misunderstanding between close kins.
Deuteronomy 23:19-20: “ You shall not charge interest on loans [nāšak II, verb] to your brother, interest [nešek, noun] on money, interest [nešek] on food, interest [nešek] on anything that is lent for interest [nāšak II, verb].  You may charge a foreigner [nokrî] interest [nāšak II, verb], but you may not charge your brother interest [nāšak II, verb], that the LORD your God may bless you in all that you undertake in the land that you are entering to take possession of it.”
You should not charge any interest from your brother for food, money, or any other loan. You may charge interest from a foreigner but not your brother. If you do so, God will bless you whatever you do – whether you possess land or any other things.
It shows that the Bible gives so much importance to kin love. You should show your love and lend money to your brother if you are better financially.
As you can see, there was a bit of controversy between Leviticus 25: 35 and Exodus 22:25 with Deuteronomy 23:19-20. While Exodus 22:25 and Leviticus 25: 35 focus on a ban on interest on the loans for the poor people who can’t pay back, Deuteronomy 23:19-20 puts a ban on interest on a loan given to your brother but not a foreigner.
To discuss this in the present-day context, lenders have become profit-making organizations in the form of banks and other lending institutions. The lenders are entirely following the foreign ideology. Not only foreigners, but the lenders are also charging high-interest rates from all. Be it brothers (fellow citizens) or foreigners, they have to deal with compounding interests.
Though ethically and morally, the lenders should not charge interest. However, it might be necessary to change interest rates to benefit the national economy. But, due to high-interest rates, people are getting into debt like never before.
Our government is still somewhat following the Biblical teachings and helping people solve their debt problems, especially during the Covid-19 pandemic. Interests are suspended for most federal student loan payments through May 1, 2022.
“In August 2021, the Education Department announced a $5.8 billion round of forgiveness to wipe out student loan debt for 323,000 borrowers who have total and permanent disabilities that prevent them from being able to work.”
Eligible borrowers must be registered as having a “total and permanent” disability (TPD) by the Social Security Administration (SSA) to have debt automatically discharged. Borrowers no longer have to fill out a separate application to receive relief.”
Therefore, it can be said that the government is helping people to solve their debt problems during this difficult time. It can be said that the Biblical principles of the old testament are being followed in the present times to some extent.
Should Christians lend or borrow money?
As per the Bible and old testament, it’s best not to lend or borrow money. But the question is, how many Christians are ready to follow that? Money lending has become a big business in the country. Christians are not satisfied with what they have. Hence their dependency on credit cards and loans has increased. Whether credit card debt or student loan debt, Americans are paying a massive amount of interest.
On the other hand, lenders are also running after money. They are not thinking from their heart, and that’s where the problem begins. Before giving money, Christians should think if they are giving money to help people and accumulate good fortune or to reap profits? Does the borrower really need the loan? What about the loan terms and interests? Are they reasonable? Can the borrower afford the loan? Is the amount too high? Will it help the borrower to improve their financial situation?
It’s the heart that is important. If Christians don’t have a compassionate heart and a strong faith in Jesus, they are more likely to act in ways that they shouldn’t.