Templars and early banking

"Medieval banking existed in a moral gray area from the 10th century until well into the 15th century. Before this period, Europe was too poor to support an extensive, morally corrupting banking system. By the end of the 15th century, the major Italian banking houses had learned ways of circumventing Church disapproval in their financial transactions. When they could not find loopholes, they increasingly violated the religious prohibitions. 

The Church's main objection to banking was the practice of usury. This is the practice of lending at rates of interest which are considered excessive, or even punitive. Some medieval moneylenders, for example, lent out money at rates as high as 100%. Most moneylenders, however, did not charge a rate above 33 1/2%, which was usually accepted as the ceiling for non-usurious interest. (...)

Originally, the banking profession was dominated by non-Christians--Jews in northern Europe, Jews and Muslims in the southern, frontier regions. A new Christian merchant class, often referred to collectively as Lombards, pushed most non-Christians out of the banking business by the end of the 15th century. One of the first groups to successfully challenge the Jewish monopoly was the Templars.

All three religions -Christian, Jewish, and Muslim- had similar prohibitions against usury. These prohibitions derived from passages in the Old Testament. All three religions, in theory, waived these prohibitions when the moneylender engaged in transactions with those outside of his faith. Christians, however, did not always consider Jews as technically foreigners in financial matter.

The Templars side-stepped the taboos against usury in two ways. First, whenever they lent money, the transaction always showed the amount which was to be paid back, not the amount originally lent. This masked the interest charged to the borrower. Second, the Templars often took over the management of entire estates. They might take ownership of the property permanently, or they might merely manage it, keeping all, or part, of the profits from the property, until the owner took back the original estate. The real owner could demand, and receive, a report on the current state of his or her property on a daily basis (except on Sundays and feast days). (...)

The Templars were favored by both great and small investors because of their reputation for honesty, security, and intelligent investment. These investors included nobles and non-nobles, rich and those of modest income, men and women. (...) While crusading enthusiasm did wane in the late 13th century, there is no evidence that the Temple was in immediate danger of penury. In fact, as its military activities decreased in success, its banking and shipping (including privateering) activities flourished."

This blog presents quotes from pages 40-42 of Stiles, Paula Regina, "BETWEEN TWO FAITHS: THE ARABIZATION OF THE KNIGHTS TEMPLAR DURING THE CRUSADES" (1999). Open Access Master's Theses. Paper 1805. The illustration shows a picture of Jewish lenders from the Vidal Mayor codex, source Wikipedia

 Support TemplarsNow™ by becoming a Patron, tipping us or buying one of our Reliable Book

No comments: