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The same incentive you'd have to do something for someone without receiving payment - a desire to help. I'd imagine the fact that people in that time had strong
by timfsu 3y ago
The same incentive you'd have to do something for someone without receiving payment - a desire to help. I'd imagine the fact that people in that time had stronger familial ties to others in their village also helped increase payback rates.
- ars 3y agoAnd both religious created a way to indirectly pay interest by turning it into a business partnership. i.e. when you are helping someone (a friend, relative) you don't pay interest. But when it's a business loaning the money that desire to help doesn't exist, and it becomes a business partnership instead. https://en.wikipedia.org/wiki/Loans_and_interest_in_Judaism https://en.wikipedia.org/wiki/Loans_and_interest_in_Judaism specifically: "Heter iska". And https://en.wikipedia.org/wiki/Murabaha https://en.wikipedia.org/wiki/Murabaha for Muslims (I think there are other forms as well). A copy of a Heter Iska: http://www.jlaw.com/Forms/iska_d.html http://www.jlaw.com/Forms/iska_d.html
- OkayPhysicist 3y agoYou're supposed to use Mudarabah[0] preferentially, which is dramatically less of a lazy hack around usury rules than Murabaha. (Also as a English speaker, those words are very hard to distinguish.) [0] https://en.wikipedia.org/wiki/Profit_and_loss_sharing https://en.wikipedia.org/wiki/Profit_and_loss_sharing