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Message: <blockquote data-quote="fusangite" data-source="post: 2108652" data-attributes="member: 7240">Medieval banking began in the 14th century in Italy with a bank opened by the Franciscan order. They were the first non-Jews to charge interest legally in Europe because of a complex new theological doctrine they developed (one we take for granted today).Before the Franciscans, the church believed, based on the doctrines of Aristotle, that all things had fixed objective value. Not only was it wrong to charge interest on something, it was also wrong to raise a price when the good became scarce or to pay less than usual when a good was overly abundant. While it was okay for merchants to charge more for items to cover transportation or guarding costs, it was viewed as dishonest and sinful prices to change beyond that limited range.Thus, a bushel of grain, in the views of the church, was always worth the same amount of gold, irrespective of how much grain and gold there were in the world because the value of grain and gold were fixed and natural arising from the objects themselves. For this reason, money lending was out of the question because an amount of money now should always be of equal value to the value of the same amount of money at any other point in time.The Franciscans changed all that. They explained that value was subjective, not objective -- that the value of an object was dependent on the purchaser and vendor and did not inhere in the object itself.And so, they were permitted to open a bank that charged interest. My understanding of how Jewish banking went is a little shakier but I believe it started in Western Europe sometime between the Carolingians and the Ottonians in the 9th or 10th century. Sorry I can't provide more specific information about how individual lending institutions worked either before or after the 14th century but hopefully some of the above data is useful.</blockquote>

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