It may then be said that until the ninth century canonical decrees forbade this profit, shameful as it was considered, only to clerics. The canonical laws of the Middle Ages absolutely forbade the practice. It is a curious fact that for a long time impunity in such matters was granted to Jews. The schismatic Greeks, at least since the sixteenth century, do not consider the taking of interest on loans as intrinsically bad. By degrees a certain number of Catholic wriers relaxed their severity.
Economists generally uphold the theoretical lawfulness of interest on loans.
Contemporary laws always consider the loan for consumption as gratuitous in principle, but allow a stipulation for the payment of interest to be added. The Holy See admits practically the lawfulness of interest on loans, even for ecclesiastical property, though t has not promulgated any doctrinal decree on the subject. Everyone admits that a duty of charity may command us to lend gratuitously, just as it commands us to give freely. It may be remarked that the best authors have long since recognized the lawfulness of interest to compensate a lender for the risk of losing his capital, or for positive loss, such as the privation of the profit which he might otherwise have made, if he had not advanced the loan. These are what are called extrinsic grounds, admitted without dispute since the end of the sixteenth century, and justifying the stipulation for reasonable interest, proportionate to the risk involved in the loan.