The Power of a Loan: A Mitzvah of Dignity and Compassion

Rabbi Yehuda David Eisenstein (Otzar Dinim U'minhagim, pg. 188) explains a foundational concept in Jewish law: Someone who borrows money or goods that will later be returned is called a loveh (borrower), while the one who provides the money or goods is the malveh (lender). The actual item being lent is referred to as a halva’ah (loan).

It is instructive to remember that lending to those in need is considered a mitzvah (positive commandment). This is referenced in Shemot 22:24, "If you lend money to My people, to the poor among you..." The Rambam (Mishneh Torah, Laws of Lending and Borrowing 1:1) emphasizes that this mitzvah is even greater than giving charity, because a person who asks for a loan may be struggling silently, choosing not to reveal their hardship to others. Lending allows them to maintain their dignity and independence.

The Midrash (Tanchuma, Mishpatim 15) gives further expression to the value of this mitzvah and teaches, "Hashem says: If you lend money to My people, you are worthy to dwell near Me." This act of compassion is therefore not optional; it is a sacred duty. Yet it comes with equally serious responsibilities: one may not charge interest or pressure a borrower who cannot repay.

The Torah clearly warns: "Do not act as a creditor to him and do not impose interest" (Shemot 22:24). In Vayikra (25:35–37), it further commands us to support those who have fallen on hard times without seeking profit: “Do not take interest or increase; fear your God and let your brother live with you.”

The Rambam (Mishneh Torah, Laws of Lending and Borrowing 1:2, 4:1-2) explains that pressuring a poor person to repay when they cannot is a violation of a Torah prohibition. Interest - whether on money, food, or any other item - is forbidden. It is called neshech (literally “biting”) because it causes pain like a predator biting into flesh. This prohibition applies not just to the lender but also to the borrower, witnesses, and even the person who writes the loan contract. All are held accountable.

In fact, the Rambam (Mishneh Torah, Laws of Lending and Borrowing 4:7) goes so far as to say that someone who records a loan with interest is like one who has denied Hashem, and people who decide to take and make loans with interest among themselves are like people who deny Hashem and reject the Exodus from Egypt. These are powerful statements about the moral gravity of exploiting others in Jewish thought.

Rabbi Samson Raphael Hirsch (commentary to Shemot 22:24) writes that the Torah places interest-free lending at the very heart of social ethics. It demands that the lender act with sensitivity and warns against any form of humiliation toward the borrower. This mitzvah is not only predicated on charity; it's also built on empathy.

Still, Jewish law is clear: if someone can repay their loan and chooses not to, that too is a serious moral failing. In the words of Tehillim (37:21): “The wicked borrows and does not repay.” The Rambam (Mishneh Torah, Laws of Lending and Borrowing 1:4) rules that even if the borrower is financially burdened and the lender is wealthy, the court must collect the debt to the last coin. Justice does not excuse irresponsibility.

Rabbi Ezra Batzri (Dinei Mamonot, Section 1, pg. 130) beautifully summarizes the heart of this mitzvah: “Almost every person needs a loan at some point in life. There is pain and shame in being turned away empty-handed. Therefore, one must always remember this when someone approaches you for help. If you’re concerned about repayment, take collateral or a guarantor, but don’t harden your heart. Don’t say no when you can say yes.”

In Jewish thought, lending is far more than a financial issue. It’s about trust, hope, and the chance to uplift a soul with dignity.