Money, interest and the magistrate

A new sovereign and its money

Before Geneva could legislate on interest, it had to become a monetary authority. Under the bishops the right of coinage had belonged to the prince-bishop. After his departure in 1533 and the defeat of Savoy in 1536, the Genevan authorities assumed the regalian rights, including that of minting. On 10 October 1535 the Small Council resolved to strike money “with our arms”. Between 1535 and 1544 the new mint produced billon coins (deniers, quarts and sols), silver testons and half-testons from 1535, and gold écus and half-écus from the early 1540s. The florin, the unit of account, was divided into twelve sols or 144 deniers, with the écu valued at four florins and eight to ten sols. The motto Post tenebras lux, derived from a longer formula used in the struggle for independence around 1530, was shortened to its familiar form in 1542, after Calvin’s return.¹

The comparison with Zurich is instructive. Zurich’s city council had acquired control of the mint from the Fraumünster abbey in the fifteenth century, as Part A of this book describes. By the Reformation the city had issued its own coinage for generations. For Zurich, money was an established attribute of an old republic. For Geneva, the right to strike coin was one of the first signs of a new sovereignty, won in the same years as the Reformation and in the same struggle. That association between independence, religion and money would recur throughout Genevan history, giving financial questions in Geneva a political charge they rarely had in Zurich.

The public debt of a besieged city

Geneva’s first experience of large-scale borrowing came with its liberation. To pay the debt owed to Bern, the city combined several sources of revenue. The confiscated property of the church and the goods of banished persons, traitors and fugitives yielded about 10,600 gold écus in 1536, to which fines and fees paid by returning fugitives and new burgesses added some 1,700 écus. In addition, the authorities imposed a compulsory loan on the inhabitants at six per cent, secured on the confiscated property. Within seven months some 300 lenders had subscribed about 4,400 écus, a sum repaid in full within eight years. After the Bernese debt was settled in 1537, the Trésor de l’Arche remained in existence to finance the fortifications. The city then borrowed repeatedly, mainly from creditors in Basel. Its debt peaked at 36,500 écus in 1546, when the service of the debt absorbed some 29 per cent of annual revenue. From 1551 the government set about reducing the burden.²

These figures deserve attention. They show that the Genevan Reformation was accompanied from its first days by a practical engagement with credit: a forced loan bearing interest at six per cent, secured by collateral, repaid over eight years, and followed by recourse to the capital market of Basel. Basel, with its public exchange and its merchant houses, was at that time the leading credit centre of the Swiss Reformed world. The Historisches Lexikon der Schweiz, in its article on interest, observes that the Basel public exchange became Switzerland’s most important public bank.³ A city that borrowed at interest from its Reformed neighbours, and that borrowed from its own citizens at six per cent, could hardly condemn every form of interest as sinful. Calvin’s teaching on usury, formulated in precisely these years, should be read against this background.

Calvin’s letter on usury

Calvin’s best-known statement on interest is a letter to a friend, usually identified as Claude de Sachins, which the published correspondence dates to 7 November 1545.⁴ The letter circulated in Latin under the title De usuris and became one of the most frequently cited texts in the early modern debate on interest. Its argument is compact. Calvin denies that Scripture contains any general prohibition of interest. In the translation used by Michael Wykes, he writes that “there is no witness of scripture by which all usury is totally forbidden”. The Old Testament prohibitions in Deuteronomy and Ezekiel, he argues, belonged to the political law of Israel and were adapted to its circumstances. In his reading, the words of Christ in Luke 6:35, “lend, hoping for nothing again”, concern charity towards the poor and do not forbid commercial lending. The scholastic argument that money is sterile and cannot breed money Calvin dismisses as childish: money in the hands of a merchant, invested in goods or land, produces a return in which it is not unjust for the lender to share. The standard by which interest must be judged is equity, the “rule of equity” of Matthew 7:12, the golden rule.⁵

The permission is hedged with conditions. Calvin lists seven restrictions: interest must not be taken from the poor; the lender must not be so intent on gain that he neglects his duties of charity; the terms must conform to natural equity and to the golden rule; the borrower must gain at least as much as the lender; the practice must be judged by the word of God; the public good must be considered; and the lender must not exceed the maximum rate fixed by the laws of the country. John Munro, quoting an early English translation, renders the core sentence as follows: “I do not consider that usury is wholly forbidden among us, except it be repugnant to justice and charity”. The same translation gives the last condition as “that we exceed not the maximum rate or limit laid down in any country or commonwealth”.⁶ Pascaline Depouhon, summarising the letter, emphasises Calvin’s personal reluctance: he would prefer that usury be banished from the world altogether, but he cannot pronounce beyond what the word of God expresses.⁷

The commentaries confirm the letter. In his exposition of Ezekiel 18 and Deuteronomy 23, Calvin treats the Mosaic prohibition as a political law of the Jewish commonwealth without binding force for Geneva. In his commentary on Psalm 15:5 he reads David’s condemnation of the man who puts out his money “to usury” as directed against unjust bargains in which equity is disregarded.⁸ The position is best described as a jurist’s solution: interest is lawful in principle, while charity, equity and the law of the magistrate control its abuse. It is worth stressing that the last element, the law of the magistrate, gave the civil authority a decisive role. In that respect Calvin and the Zurich reformers were closer than their disputes on discipline might suggest.

Geneva’s legislation on interest

The Genevan magistrate did not wait for Calvin to regulate interest. According to Depouhon, a law on lending at interest of 19 February 1544 confirmed an earlier ordinance of 17 January 1538. She also states that the Genevan authorities limited the rate first to five per cent and later to 6.66 per cent, that is, one in fifteen.⁹ Wykes adds that a committee chaired by Calvin recommended an upper limit of five per cent in 1543, a ceiling that later rose to about 6.67 per cent.¹⁰ The Historisches Lexikon der Schweiz, in its general article on interest, notes that Calvin favoured interest at a moderate rate of five per cent and that sixteenth-century authorities in the Swiss territories generally fixed a maximum of five per cent on annuity letters.¹¹

Two observations follow. First, the Genevan rates were moderate and firmly regulated. They resemble the Zurich practice described in Chapter B.III, where the council fixed the rate on Gülten and annuities at five per cent and punished excess. A Zurich merchant visiting Geneva in the 1540s would have found nothing strange in its interest law. Secondly, the rate of six per cent on the compulsory loan of 1536 and the ceiling of five per cent in the ordinances of 1538 and 1544 were set by the same authorities within a few years of each other. The Genevan magistrate thought of the interest rate as an instrument of public policy, to be set according to the needs of the city. Calvin’s theology gave that practice a theological justification.

Zurich’s parallel path

Zurich had reached comparable conclusions by a different road. Zwingli, in his sermon Von göttlicher und menschlicher Gerechtigkeit of 1523, distinguished between the absolute righteousness demanded by God, before which all taking of interest stood condemned, and the imperfect human righteousness enforced by the magistrate, which could permit moderate interest in the interest of peace and order. Bullinger developed the argument further and, in his sermons, defended the lawfulness of moderate interest on productive loans. John Munro, in the study already cited, notes that Bullinger held views similar to Calvin’s and quotes his view that a good and honest man may reap some lawful profit from the advance of his money when it is employed in a productive venture.¹² These doctrines, and the Zurich legislation on annuities and Gülten, are the subject of Chapter B.III and need not be repeated here.

The difference between Zurich and Geneva on interest was therefore small in substance and large in reception. Calvin’s letter, precisely because it was a short, clear and quotable statement by a famous theologian, entered the European debate and was cited for centuries as the moment when Protestantism accepted interest. The protestinfo news agency could still write in 2016 that Calvin was the first theologian in Europe to endorse lending at interest.¹³ Zwingli’s distinction between divine and human righteousness, embedded in a German sermon on social ethics, travelled less far. Zurich’s contribution to the legitimation of interest was as important as Geneva’s. It was absorbed into the practice of a city government, whereas Calvin’s entered the literature. The same asymmetry of reputation would later affect the image of the two financial centres.

Notes

1. Archives d’État de Genève, “La monnaie”, https://archives-etat-ge.ch/page_de_base/6-la-monnaie/. ↩
2. Archives d’État de Genève, “Emprunts et revenus” (as above). ↩
3. Anne-Marie Dubler, “Intérêts”, Dictionnaire historique de la Suisse (DHS), version of 3 February 2015, https://hls-dhs-dss.ch/fr/articles/013923/2015-02-03/. ↩
4. Pascaline Depouhon, “La légitimité du prêt à intérêt chez Jean Calvin”, La Revue réformée no. 266 (2013/2–3), https://larevuereformee.net/articlerr/n266/la-legitimite-du-pret-a-interet-chez-jean-calvin, which refers to the “Lettre à un ami” addressed to Claude de Sachin and gives the date of 7 November 1545. ↩
5. Michael Wykes, “Devaluing the Scholastics: Calvin’s Ethics of Usury”, Calvin Theological Journal 38 (2003), pp. 27–51, https://www.calvin.edu/library/database/crcpi/fulltext/ctj/88050.pdf, especially pp. 42–43 and 51. ↩
6. John H. Munro, “Usury, Calvinism, and Credit in Protestant England: from the Sixteenth Century to the Industrial Revolution”, University of Toronto, Department of Economics, Working Paper 439 (2011), https://www.economics.utoronto.ca/public/workingPapers/tecipa-439.pdf. Wykes (as above), p. 47, likewise lists seven conditions at the end of the letter; the paraphrase of the seven given here follows the common reading and may differ in detail from the wording of particular translations. ↩
7. Depouhon (as above). ↩
8. Wykes (as above), pp. 43 and 46. ↩
9. Depouhon (as above), quoting the “Loi sur le prêt à intérêt du 19 février 1544, confirmant celle du 17 janvier 1538” and stating that the Genevan authorities limited the rate to 5% and later to 6.66%. ↩
10. Wykes (as above), p. 41. ↩
11. Dubler, “Intérêts” (as above). ↩
12. Munro (as above), on Bullinger’s position. Zwingli’s and Bullinger’s teaching is treated in detail in Chapter B.III of this book. ↩
13. Protestinfo, “Quand Calvin légitimait le prêt à intérêt”, 1 December 2016, now at https://www.reformes.ch/201612018222/8222-quand-calvin-legitimait-le-pret-a-interet.html. ↩

For general information only. This article does not constitute legal or tax advice, does not replace advice on an individual case and creates no lawyer-client relationship. It reflects the legal position as of September 2025.