The Christian Science Monitor reports that many Chrisitian organizations are now in the microloan business around the world.
Many churches and Chrisitan relief organizations are making small loans to people in developing nations, mainly for start up businesses.
While I find the idea behind this to be exactly what the Church should be doing around the world – helping the poor to create their own safety net – I am a bit concerned about some of the specifics.
I understand that these ministries/businesses could not stay open if they gave out their loans. I also understand their are numerous fees and regulatory procedures that cost money. I am still not sure that this requires the intrest rate as high as 2.5% a month (30% annually).
The article points out that while this is higher than most commercial banks it is far lower than the terms offered by community loan sharks. Also, the high interest rates are needed to cover the high costs of processing loans to the poor (because of the high risk of default).
Those may all very well be true. That is why I am not attacking this organizations. I don’t know what all goes into it. But I don’t think saying, “I’m better than a loan shark” is exactly the kind of standard Christianity ministries should set for themselves.
Does anyone else know the Biblical standards for lending money? This has little, if any, to do with legality, but rather morality. Is this right? Is it moral? Is it Biblical?