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Commercialization and Microfinance Interest Rates: Usury or Just Prices?

Kenman Wong, Donovan Richards

Abstract


Prevailing microfinance interest rates can be very high (2030 percent on average and well exceeding 100 percent in some cases). The number of faith-based (especially Christian) organizations in the field, biblical injunctions against charging interest to poor people, and increasing commercialization present acute ethical tensions. In conjunction with contemporary research, the authors examine biblical passages and reflect theologically, employing a narrative-ethical approach to the issue of interest rates in contemporary microfinance. They conclude that while prohibitions against usury are still appropriate, a broad condemnation of high interest rates in microfinance is presently unwarranted.

Kenman Wong and Donovan Richards, "Commercialization and Microfinance Interest Rates: Usury or Just Prices?" Journal of Markets & Morality 17, no. 2 (Fall 2014): 381-404.


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