Basically, you're right, but thinking thinking in terms of "money" is missing a more general point. A loan doesn't have to involve money at all. There are var

Basically, you're right, but thinking thinking in terms of "money" is missing a more general point. A loan doesn't have to involve money at all. There are various reasons why the price of credit isn't zero. One reason is that most humans have a "preference for the present", i.e. given the choice they would rather have something now that the same thing at some point in the future. As a result, most people are not willing to give something away now, unless they have an expectation that they will get something more valuable in the future. Another reason is that there is always risk involved in lending. The borrower might not be able to fulfil their obligations, whereas the lender might find a better use for whatever it is they're lending. Therefore, it generally is better to keep something, than to lend it at an interest rate of zero.