chapter  Chapter 9
12 Pages

Dynamics of interest-bearing debt in Hinduism

WithFerda Güvenilir, Ahmet İncekara

The Indian civilization hosts the oldest sacred texts and teachings in the world. Definitions and practices on interest-bearing debts are arranged in detail within the scriptures of Hinduism, smritis which serve as the main sources on these practices. The interest-bearing debt/loans have been justified over the time, particularly because of the changing circumstances in the economic landscape. The theological features of Hinduism as well as social and economic circumstances have contributed to this transformation. In general, the issue of interest is addressed within the caste system; rates and terms are identified according to the caste; over the time, the ban has been lifted altogether and members of all castes have become eligible for receiving and giving interest money. Interest rates and terms change by the circumstances, the time and the caste they apply. Initially despised, the practice of interest was first allowed in the Vaishya caste, followed by others to legitimize it as well.