Section 2. On Pecuniary Mutuum

579. Notions. Money is the principal object around which today the contract of mutuum turns; but because of the nature of money, very diverse from other things which are customarily given by mutuum, this species of mutuum deserves particular consideration.

1. Pecuniary mutuum (Gelddarlehen) is a contract by which money is handed over to another with the obligation of returning other money of the same value at the established time.

a. Money which is given by mutuum is usually called in the schools the principal, but now commonly capital.

b. Pecuniary mutuum is a gratuitous contract if money is handed over to another gratuitously, and it is an onerous contract if it is handed over to another with the burden of paying interest.

2. By reason of the end which the borrower intends, pecuniary mutuum is divided into consumptive mutuum, which is handed over to another for procuring for himself things necessary for his use; and productive mutuum, which is handed over to another for making gain, as if it is given to a merchant for trading, or to a rich man for increasing his goods, or to a farmer for improving his fields.

¹ Van Roey, De iusto auctario ex contractu crediti (Louvain: Van Linthout, 1903).

580. Nature of money. In the proper sense money is sterile; but improperly it is potentially fruitful, and in present times per accidens can simply be called actually fruitful.

a. Since a fruitful thing in the proper sense is said to be that which produces fruits from itself by internal fertility, as a tree, vine, field, money cannot properly be called a fruitful thing, but in the proper sense it is sterile, since money does not beget money.

b. In the improper sense a thing is called fruitful which is equivalent to fruitful things, because it can be exchanged for fruitful things, or which serves as a means and instrument for procuring gain for oneself; but money can be exchanged with any other things whatsoever and substituted for them. Therefore money itself, insofar as it can be substituted for things fruitful in themselves, is equivalent to fruitful things; moreover, by the aid of industry and commerce, it serves as a means and instrument for procuring gain for oneself.

c. Although money was always of itself apt to be exchanged with fruitful things or to be employed as the means of a lucrative business, nevertheless in ancient times the economic conditions were not such that this could have been done easily and frequently; but now, both because of the very easy communication among diverse regions and because of the very great extension of industry and commerce, economic conditions are such that everywhere money can easily be substituted for fruitful things or employed as the means of lucrative trade. Wherefore money, which in ancient times was not held as a fruitful thing and could not be held as such except potentially, must now be called an actually fruitful thing.

581. Gain from pecuniary mutuum. In the economic conditions which now exist, it is licit for each person to accept payment for pecuniary mutuum, unless by the law of charity he is bound to lend gratuitously.

a. There exist many responses of the Holy See by which today permission is positively conceded to all, both ecclesiastics and laymen, independently of the existence of an external title, to receive moderate gain from mutuum, as will be said below.

b. Since money from the conditions of our time is a fruitful thing, by the common estimate of all there belongs to it a special value, on account of which it can bring profit and utility to its possessor. Therefore he who concedes a mutuum to another deprives himself, together with the money, also of this value which now inheres in money; but it is permitted to require compensation for a special value. The circumstances of the time today are such that money commonly has for all the value of a fruitful thing: for all to whom even a modest sum of money is available easily find occasion of procuring gain and utility for themselves from it. Therefore it is licit for all to accept interest, and indeed from any mutuum, even from consumptive mutuum.

c. Just as charity requires that we assist a neighbor constituted in grave necessity through alms, so the same charity can require that to a neighbor who needs a mutuum we not only furnish it, but also furnish it gratuitously, if he is unable to pay compensation, provided this can be done by us without grave inconvenience: From him who wishes to borrow from you, do not turn away.¹

Ordinarily, however, this very inconvenience excuses the rich from furnishing mutuum to the poor where there is question of a larger sum: for ordinarily they expose themselves to the danger of losing the principal, which certainly is a grave inconvenience. Practically therefore the rich in this case satisfy their obligation by bestowing a small alms on the one seeking a mutuum.

¹ Matt. 5:42.