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The Engine of Accumulation: A History of Lending and Its Intertwined Relationship with Capitalism
Executive Summary
The lending business, far from being a modern capitalist invention, has existed for millennia, fundamentally shaped by a persistent tension: the moral condemnation of usury versus the economic necessity of credit. This report meticulously traces this journey, revealing how lending evolved from a subsistence-based practice fraught with religious prohibitions to a central, institutionalized, and now digitally-driven pillar of the global capitalist system. The analysis demonstrates that this transformation was not linear but was propelled by a series of critical innovations—from the bill of exchange to limited liability laws—and by the shifting role of the state, which transitioned from usury's enforcer to its most powerful guarantor. The report concludes that lending's future, characterized by a rapid shift to online platforms and a fragmented market, will continue to navigate the dual nature of credit as a force for both prosperity and precarity.
This report defines lending as the act of providing money or other assets with the expectation of repayment, and usury as the practice of charging interest on loans. It frames capitalism not as a static system but as a dynamic economic and social structure defined by private ownership and the accumulation of capital, with lending as its essential engine. The history of lending is presented as a microcosm of capitalism's maturation, showcasing its transition from an ethically-constrained activity to a self-regulating market force. The following table provides a chronological roadmap of the key shifts and innovations discussed in the report, visually anchoring the complex historical narrative. Era Key Event/Innovation Significance Ancient Civilizations (Sumer, Ancient India) Usury, Debt Bondage Early recognition of the social and ethical problems of lending. Middle Ages Knights Templar (Branch Banking, Traveler's Cheques) & Florentine Merchants (Bill of Exchange) Circumvention of religious prohibitions and the creation of financial networks to support long-distance trade. Industrial Revolution Bank of England, Limited Liability State-sponsored financial infrastructure and legal reforms that unlocked vast pools of capital for industrial projects. 20th Century Consumer Credit, Government Loan Guarantees Democratization of debt as a tool for social policy and mass consumption. 21st Century Securitization, Fintech, Microfinance The systemic risks of complex financial products and the emergence of new, digitally-native lending models.
2.1. The Earliest Records: Debt and Bondage in Ancient Civilizations
The practice of lending is an ancient human activity that predates formal capitalist structures. As far back as 5,000 years ago, Sumer, one of the earliest known human civilizations, grappled with the ethical and social problems of credit. Evidence suggests that wealthy landowners loaned out valuable commodities like silver and barley at exorbitant rates of 20% or more. The consequences of non-payment were severe, often resulting in debt bondage for the debtor and their family. In response to these excesses, the Babylonian monarch occasionally intervened to free the debtors, highlighting an early recognition of the social instability caused by unrestrained lending practices.1 This moral critique of lending was not unique to the ancient Near East. In ancient India, the earliest references to usury are found in Vedic texts dating from 2,000-1,400 BC, where the kusidin, or "usurer," is mentioned. Later Sutra texts (700-100 BC) and Buddhist Jatakas (600-400 BC) contain more frequent and detailed references, with early sentiments of contempt for usury being expressed during this period. For example, a well-known Hindu lawmaker of the time, Vasishtha, created a law forbidding the higher castes of Brahmanas (priests) and Kshatriyas (warriors) from being usurers.2 This demonstrates that the ethical condemnation of lending is a universal concern that emerged independently in various ancient cultures.
2.2. The Ethical and Theological Condemnation of Usury
The Abrahamic religions developed and intensified this moral scrutiny, each establishing distinct prohibitions against the practice. Jewish law, as found in the Hebrew Bible (Old Testament), prohibits charging interest (neshekh or "a bite") on loans to fellow Jews. These verses, such as those in Exodus 22:25 and Leviticus 25:36-37, frame a loan as a form of charity or mutual support within the community rather than a means for personal profit. However, these prohibitions did not extend to "foreigners" or non-Jews, allowing for transactions with outsiders. The Talmud later expanded these rules with avak ribbit ("the dust of interest") to prevent the exploitation of loopholes.2 Early Christian doctrine adopted and intensified the condemnation of usury, viewing the charging of any interest as a grave sin and a form of robbery.3 This position was cemented during the Middle Ages, reaching its zenith in 1311 when Pope Clement V made the ban on usury absolute and nullified all secular legislation that supported it. Despite this, some Christian moralists later redefined usury as only "excessive interest," a view that began to take hold around 1620 and persists to this day.2 In Islam, the Quran explicitly forbids riba (literally "excess or addition"), which is understood to be any form of interest, justified by the belief that human intellect can fail to recognize the subtle difference between interest and rent.2
2.3. The Inevitable Contradiction: Economic Necessity vs. Religious Prohibitions
The historical and religious condemnation of lending did not, however, eliminate the practice; instead, it created a structural need for financial intermediaries and a black market. The widespread religious prohibitions against usury across major world religions created a profound paradox: the moral framework declared lending at interest a sin, yet the fundamental economic need for capital persisted. This created a vacuum that could not be filled by the dominant religious communities. The Jewish exemption from the usury ban when lending to non-Jews provided a unique economic role, positioning them to become Europe's primary money lenders, a function they were often forced into by the very laws that marginalized them.2 Similarly, the Christian prohibition on lending to fellow Christians led to the emergence of a black market where the poor might pay exorbitant interest rates of 35% or more for loans.1 This economic necessity eventually compelled a gradual redefinition of terms. The moral and ethical arguments, once absolute, gave way to a pragmatic need for an organized financial system. Thinkers such as John Calvin and Adam Smith, observing Europe's emerging capitalist economies, came to accept the need for loans with interest.1 The concept of usury was subsequently redefined from a blanket condemnation of all interest to a prohibition against only excessive interest.2 This redefinition allowed the practice to be legalized and regulated with rate caps, such as the 10% legal limit in England in 1571, which was later reduced to 6% by 1651, although enforcement was often lax.1
3.1. The Rise of the "Sedentary Merchant" and the Need for Financial Networks
A pivotal moment in the development of capitalism and modern lending was the transition from the "traveling merchant" to the "sedentary merchant" in the later Middle Ages.5 While the traveling merchant accompanied his own goods to market or trade fairs, the sedentary merchant managed his business from home, relying on correspondence and intermediaries to conduct long-distance trade.5 This new business model necessitated the creation of robust, remote financial systems to manage transactions across vast, often unsafe, distances. The profitability of these operations depended on a merchant's ability to overcome spatial and informational partitioning, requiring continuous access to accurate information on prices, exchange rates, and interest rates across multiple markets.6
3.2. The Knights Templar: Pioneers of Branch Banking and Traveler's Cheques
The Knights Templar, with their extensive network of preceptories and commanderries across many countries, developed a financial system that effectively invented modern branch banking and traveler's cheques.7 This system allowed a pilgrim to deposit money in one city, such as Paris, receive a ciphered deposit receipt, and then withdraw the funds in another city, such as London.8 This service was a "no-interest" loan, with the Templars charging only a reasonable "handling fee," a model that upheld their religious principles against usury.8 This innovation provided a safe and reliable way for people to transfer money over long distances without carrying large amounts of precious metals, laying the groundwork for a more secure and interconnected financial world.
3.3. Florentine and Genoese Merchants: The Bill of Exchange as an Instrument of Credit and Circumvention
It was in the thriving mercantile cities of Northern Italy that many of the most important pre-modern financial innovations were developed.5 One of the most revolutionary was the bill of exchange ( lettera di cambio), a multi-party payment order that allowed the issuer to order a distant party to pay a debt in another currency.5 The bill of exchange was a masterstroke of financial engineering that provided a solution to the problem posed by religious prohibitions on usury. The instrument was designed to appear as a currency exchange transaction, not a loan with interest. The profit was discreetly embedded within an artificially inflated exchange rate, which was raised in the lender's favor.5 This allowed a clandestine credit market to flourish. The bill of exchange enabled merchants to transfer money over long distances without carrying physical cash, facilitating the "long-distance East-West trade" that enriched European civilization 5 and laid the foundation for modern banking practices. This formal mechanism facilitated trade between merchants who no longer met face-to-face and helped to connect those with capital to those who needed it, thereby enabling the "commercial revolution" of the later Middle Ages.5
4.1. The Central Bank and the State: The Bank of England and Public Finance
The Industrial Revolution was not financed in a vacuum; it was built upon a "financial revolution" in England that began in the early 18th century.9 The centerpiece of this reconstruction was the Bank of England, founded in 1694 with a capital of £1.2 million and the primary objective of raising money for the government.9 This established a stable system of public borrowing, around which other key financial institutions, such as insurance offices, partnership banks, and the London Stock Exchange, developed. This state-backed financial infrastructure was a critical advantage that Britain had over its European contemporaries, enabling it to marshal the capital necessary for large-scale industrialization.9
4.2. The Emergence of the Modern Corporation: Joint-Stock Companies and Limited Liability
The legal framework of limited liability was a non-obvious but arguably more significant driver of industrial lending than any single bank. Before the 19th century, investors in joint-stock companies faced unlimited liability, meaning they could lose their entire personal fortune if the company failed.10 This was a massive deterrent for capital-intensive ventures and had led to the Bubble Act of 1720, which made joint-stock companies illegal.10 A financial panic in 1825 served as a catalyst for a pivotal change, leading the government to repeal the Bubble Act and pass the Banking Act of 1826.10 The true breakthrough, however, came with new laws in 1837, 1855, and 1858 that granted banks and other companies the ability to acquire limited liability.10 This legal change fundamentally altered the risk-reward calculus for investors. By capping personal losses at the amount invested, it unlocked vast pools of capital for investment in large-scale projects like railways and canals. It provided a financial incentive for investment that encouraged the amalgamation of local banks and created the legal and institutional foundation for the large, publicly-held corporations that would come to define the capitalist landscape.10
4.3. Financing an Industrial Economy: The Role of Bank Capital
As industries grew, so did the demand for deposits and loans to finance new technologies and infrastructure.10 The number of private banks in England increased from a limited number to seventy by 1800, with county banks doubling between 1775 and 1800 to meet the needs of entrepreneurs.10 These institutions provided crucial short-term loans to cover operational shortfalls and circulating capital.10 While British banks were often criticized for not providing long-term loans in the same way as their counterparts in the US and Germany, they were a critical part of a broader financing ecosystem that included merchants, aristocrats, and family capital.10
5.1. The Introduction of Consumer Credit: Mortgages, Installment Plans, and the American Dream
The 20th century marked a profound shift in the purpose of lending, as it moved beyond a tool for corporate expansion to a mechanism for mass consumption. The 1920s through the 1950s introduced Americans to installment credit, long-term mortgages, and revolving credit.11 These innovations made credit accessible to the middle class and affluent, allowing them to use debt to improve their quality of life and acquire homes and goods. This marked a significant paradigm shift from the historical view of debt as a last resort for the poor or a tool for large corporations.11
5.2. Government as Guarantor: The Expansion of Lending through Public Policy
The 20th century saw the government transition from a passive regulator of lending to its most powerful guarantor and, in some cases, its architect. The federal government's involvement in private credit markets was minimal until after World War I, but it became a deliberate tool of social and economic policy during the Great Depression.12 The state deliberately expanded credit for targeted groups like farmers and homebuyers to stimulate the economy.12 This policy was cemented and expanded after World War II to include students and small businesses.12 The government's primary mechanism was not direct lending but loan insurance. By insuring the loans made by private entities, the state encouraged private institutions to lend more to groups they might otherwise have considered too risky.12 This deliberate policy helped create a national market for securitized debt through the establishment of government-sponsored enterprises like Fannie Mae in 1938 and Freddie Mac in 1970.12
5.3. The Rise of Specialized Lending: Factoring and Trade Credit
Beyond traditional banking, the 20th century saw the growth of specialized lending forms. "Factors" emerged as new lending firms that provided capital to small businesses, using their accounts receivable as collateral.12 This proved to be a critical source of financing, particularly in the automobile industry, where auto paper comprised 90% of the factor market by 1933.12 Similarly, trade credit (allowing buyers to use goods before paying) proved remarkably resilient in both economic slumps and booms, often stepping in as a flexible financing tool when bank credit contracted.12
6.1. The Great Crisis of 2008: A Case Study in the Perils of Deregulation and Securitization
The subprime mortgage crisis of 2008 was a direct consequence of a system that prioritized the flow of capital over the quality of debt, fueled by a regulatory framework that could not keep pace with financial innovation. The crisis was a culmination of several trends, including excessive speculation, predatory lending for subprime mortgages, and a "shadow banking system" that operated outside traditional regulation.13 Financial innovations like mortgage-backed securities (MBS) allowed lenders to package and sell off risk, creating a perverse incentive for lax underwriting standards.14 This "originate-to-distribute" model led to weak and fraudulent underwriting practices, as lenders could offload the loans immediately and had little incentive to vet borrowers carefully.13 When the housing bubble burst, the value of these complex securities collapsed, triggering a liquidity crisis that spread globally and resulted in bank failures, most notably the bankruptcy of Lehman Brothers in September 2008.14 The crisis demonstrated that risk had not been eliminated but merely redistributed and that a failure of regulation and a reliance on complex, poorly understood financial instruments could bring the global financial system to its knees.14
6.2. The Fintech Revolution: From P2P Platforms to AI-Driven Credit
The 2008 crisis, by causing traditional banks to tighten their lending policies, created a massive market demand for new financial models.15 This vacuum fueled the rise of Fintech companies, which leveraged technology to reduce costs, increase operational efficiency, and reach new markets.15 Key Fintech innovations include mobile lending, Peer-to-Peer (P2P) platforms, and AI-driven credit scoring that uses alternative data to assess risk. This shift has altered consumer behavior, providing instant access to products and services that were previously unavailable.16
6.3. The Role of Microfinance: Using Lending to Foster Financial Inclusion
Simultaneously, microfinance and online lending platforms have emerged to provide financial services to underserved populations that lack access to traditional banking services.15 Platforms such as Lendwithcare link lenders in the developed world with borrowers in developing countries, using crowdfunding to support entrepreneurial activity.15 This continues the long-standing debate about the moral purpose of lending, aiming to use credit as a tool for financial inclusion and poverty reduction rather than merely for profit.16
7.1. Global Market Overview: Size, Segmentation, and Regional Dynamics
The global lending market is a massive and growing enterprise, with a value of nearly $10.4 trillion in 2023.17 The market is projected to expand significantly, reaching an estimated $14.9 trillion by 2028 and $21 trillion by 2033.17 The analysis of the market by segment reveals several key trends: By Type: Household lending was the largest segment in 2023, accounting for 43.81% of the total, or $4.6 trillion. It is also projected to be the fastest-growing segment, with a compound annual growth rate (CAGR) of 10.02% between 2023 and 2028.17 By Interest Rate: Fixed-rate lending was the largest segment, valued at $6 trillion in 2023, while floating-rate lending is the fastest-growing segment, with a projected CAGR of 7.93% during the same period.17 By Lending Channel: Offline lending remains the largest channel, with a 51.83% share ($5.4 trillion) in 2023. However, online lending is the fastest-growing, with a projected CAGR of 8.04%.17 By Region: Western Europe accounted for the largest regional share in 2023 at 38.49% ($4 trillion), followed by North America and Asia-Pacific. The fastest-growing regions are projected to be South America and Africa, with CAGRs of 12.26% and 10.34%, respectively.17 Category 2023 Value/Share Projected Fastest-Growing Segment (CAGR 2023-2028) Market Value ~$10.4T Projected to reach ~$14.9T by 2028 Type Household ($4.6T) Household (10.02% CAGR) Interest Rate Fixed Rate ($6T) Floating Rate (7.93% CAGR) Channel Offline ($5.4T) Online (8.04% CAGR) Region Western Europe (38.49%) South America (12.26% CAGR) & Africa (10.34% CAGR)
7.2. Key Trends: The Shift from Offline to Online and the Adoption of New Technologies
The fastest-growing segments in the global lending market directly reflect the technological and demographic shifts of the 21st century. The significant growth in household lending and the rapid rise of online platforms is a continuation of the 20th-century democratization of debt, but now supercharged by digital technology. This is driven by consumer demand for convenience and the ability of technology to reach a broader, often underserved, market. The projected growth in developing regions like South America and Africa indicates that online lending and microfinance are proving to be effective tools for extending financial inclusion to populations previously excluded from the formal economy.17 This is a critical trend for understanding the future of capitalism, as it expands its reach and influence. The trends mentioned in the market data—blockchain, AI, alternative credit data, and advanced platforms—are the core technologies enabling this shift. They are fundamentally changing how risk is assessed and how loans are distributed, moving away from a traditional, branch-based model towards a more decentralized and data-driven one.17
7.3. The Fragmented Future: A Look at Competitors and Collaborative Models
The global lending market is fairly fragmented, with the top ten competitors holding only 11.53% of the total in 2023.17 This suggests that a new era of lending is emerging, one based more on specialized services and strategic partnerships rather than on monolithic, full-service institutions.16 This fragmentation parallels the shift seen in the Industrial Revolution, where new legal and financial structures replaced old models, but this time driven by technology rather than political decree.10
8.1. Synthesis of Key Historical Movements
The history of lending is a story of overcoming moral, logistical, and legal barriers to fuel economic growth. It has evolved from a morally suspect, subsistence-based activity in ancient civilizations to a core driver of both corporate and consumer-led capitalism. The report has demonstrated how critical innovations—from the bill of exchange to securitization and fintech—and legal frameworks—from usury laws to limited liability—have been indispensable catalysts in this journey. Each new era has brought with it new methods for managing risk, allocating capital, and expanding the reach of credit, fundamentally transforming the economic landscape.
8.2. Final Reflections on Lending as a Source of Both Prosperity and Precarity
The history of lending is defined by its dual nature. While it has proven to be a powerful engine of accumulation, enabling industrialization and democratizing opportunity through consumer credit, its history is also marked by cycles of speculative excess. The 2008 financial crisis serves as a stark reminder of the dangers of a system that prioritizes the flow of capital over the quality of debt.14 The future of lending, with its promise of greater financial inclusion through technology 15, must also contend with new risks, such as algorithmic bias and the potential for a new form of digital debt bondage. The core tension between the moral and economic dimensions of lending, a theme that began with debt bondage in ancient Sumer 1, remains as relevant today as ever, shaping the ongoing evolution of the global capitalist system. 참고 자료 Usury in Historical Perspective - JSTOR Daily, 9월 19, 2025에 액세스, https://daily.jstor.org/usury-historical-perspective/ History of Usury Prohibition - Alastair McIntosh, 9월 19, 2025에 액세스, https://www.alastairmcintosh.com/articles/1998_usury.htm Between God and money: The morality of interest - EARS | www.ears.eu, 9월 19, 2025에 액세스, https://europeanacademyofreligionandsociety.com/news/between-god-and-money-the-morality-of-interest/ Usury and Religion: Historical Perspectives on Jewish and Christian Views Douglas C. Youvan - ResearchGate, 9월 19, 2025에 액세스, https://www.researchgate.net/profile/Douglas-Youvan/publication/382143296_Usury_and_Religion_Historical_Perspectives_on_Jewish_and_Christian_Views/links/668f0b63c1cf0d77ffcbe3aa/Usury-and-Religion-Historical-Perspectives-on-Jewish-and-Christian-Views.pdf Merchants and the Origins of Capitalism - Harvard Business School, 9월 19, 2025에 액세스, https://www.hbs.edu/ris/Publication%20Files/18-021_b3b67ba8-2fc9-4a9b-8955-670d5f491939.pdf Capitalism and Market in the Renaissance - Cairn, 9월 19, 2025에 액세스, https://shs.cairn.info/article/E_LECO_030_0087/pdf?lang=en The Knights Templar And The Pioneers of Gold-Backed Credit, 9월 19, 2025에 액세스, https://jrotbart.com/the-knights-templar-and-the-pioneers-of-gold-backed-credit/ Order of the Temple of Solomon Knights Templar Banking Principles, 9월 19, 2025에 액세스, https://knightstemplarorder.org/heritage/templar-banking/ The role of the banks (Chapter 11) - The First Industrial Revolution, 9월 19, 2025에 액세스, https://www.cambridge.org/core/books/first-industrial-revolution/role-of-the-banks/080AE00A84C02FEC9A6AF2E60CB5DAB2 The Development of Banking in the Industrial Revolution - ThoughtCo, 9월 19, 2025에 액세스, https://www.thoughtco.com/development-of-banking-the-industrial-revolution-1221645 esusurent.com, 9월 19, 2025에 액세스, https://esusurent.com/blog/a-brief-history-of-u-s-consumer-credit-part-2-consumer-credit-becomes-a-right/#:~:text=The%201920s%20through%201950s%20introduced,class%20and%20affluent%20at%20least. History of Credit in America | Oxford Research Encyclopedia of ..., 9월 19, 2025에 액세스, https://oxfordre.com/americanhistory/oso/viewentry/10.1093$002facrefore$002f9780199329175.001.0001$002facrefore-9780199329175-e-625?p=emailAQw6Ix6Q3W6tg&d=/10.1093/acrefore/9780199329175.001.0001/acrefore-9780199329175-e-625 The Nature and the Origin of the Subprime Mortgage Crisis - San Jose State University, 9월 19, 2025에 액세스, https://www.sjsu.edu/faculty/watkins/subprime.htm 2008 financial crisis - Wikipedia, 9월 19, 2025에 액세스, https://en.wikipedia.org/wiki/2008_financial_crisis Fintech and microfinance | University of Portsmouth, 9월 19, 2025에 액세스, https://www.port.ac.uk/research/research-areas/areas-of-expertise/fintech-and-microfinance How to Build a Microfinance Lending Platform | HES FinTech, 9월 19, 2025에 액세스, https://hesfintech.com/blog/how-to-build-microfinance-lending-platform/ Lending Market Size, Competitors, Trends & Forecast to 2033, 9월 19, 2025에 액세스, https://www.researchandmarkets.com/report/lending