Christian finance is a kind of ethical finance following

Christian ethics Christian ethics, also known as moral theology, is a multi-faceted ethical system. It is a Virtue ethics, virtue ethic, which focuses on building moral character, and a Deontological ethics, deontological ethic which emphasizes duty according ...

. Although not widely used, the notion of "Christian finance" or "Catholic finance" refers to

banking A bank is a financial institution that accepts Deposit account, deposits from the public and creates a demand deposit while simultaneously making loans. Lending activities can be directly performed by the bank or indirectly through capital m ...

and financial activities which came into existence several centuries ago. Whether the activities of the

Knights Templar The Poor Fellow-Soldiers of Christ and of the Temple of Solomon, mainly known as the Knights Templar, was a Military order (religious society), military order of the Catholic Church, Catholic faith, and one of the most important military ord ...

(12th century),

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(appeared in 1462) or the

Apostolic Chamber The Apostolic Camera (), formerly known as the was an office in the Roman Curia. It was the central board of finance in the papal administrative system and at one time was of great importance in the government of the States of the Church and in ...

attached directly to the

Vatican Vatican may refer to: Geography * Vatican City, an independent city-state surrounded by Rome, Italy * Vatican Hill, in Rome, namesake of Vatican City * Ager Vaticanus, an alluvial plain in Rome * Vatican, an unincorporated community in the ...

, a number of operations of a banking nature (money

loan In finance, a loan is the tender of money by one party to another with an agreement to pay it back. The recipient, or borrower, incurs a debt and is usually required to pay interest for the use of the money. The document evidencing the deb ...

guarantee A guarantee is a form of transaction in which one person, to obtain some trust, confidence or credit for another, agrees to be answerable for them. It may also designate a treaty through which claims, rights or possessions are secured. It is to ...

) or a financial nature (issuance of

securities A security is a tradable financial asset. The term commonly refers to any form of financial instrument, but its legal definition varies by jurisdiction. In some countries and languages people commonly use the term "security" to refer to any for ...

investments Investment is traditionally defined as the "commitment of resources into something expected to gain value over time". If an investment involves money, then it can be defined as a "commitment of money to receive more money later". From a broade ...

) were practiced, despite the prohibition of

usury Usury () is the practice of making loans that are seen as unfairly enriching the lender. The term may be used in a moral sense—condemning taking advantage of others' misfortunes—or in a legal sense, where an interest rate is charged in e ...

and the

Catholic Church The Catholic Church (), also known as the Roman Catholic Church, is the List of Christian denominations by number of members, largest Christian church, with 1.27 to 1.41 billion baptized Catholics Catholic Church by country, worldwid ...

's distrust against exchange activities (opposed to production activities). Christian finance is characterized by the existence of three dimensions: personal (actors), operational (operations), and dogmatic (principles).

General description

Actors

In the

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, Catholic clerical finance continues to be conducted through the

Vatican Bank Vatican may refer to: Geography * Vatican City, an independent city-state surrounded by Rome, Italy * Vatican Hill, in Rome, namesake of Vatican City * Ager Vaticanus, an alluvial plain in Rome * Vatican, an unincorporated community in the ...

(IOR), and many Catholic lay financial players also exist, both in Germany (e.g. Pax-Bank, Liga Bank, Darlehenskasse DKM) or the

United States of America The United States of America (USA), also known as the United States (U.S.) or America, is a country primarily located in North America. It is a federal republic of 50 states and a federal capital district, Washington, D.C. The 48 contiguo ...

(e.g. Catholic Family Federal Credit Union, Holy Rosary Credit Union, Emerging Capital Funding)). Other Christian community actors exist (e.g. Christian Community Credit Union, Kingdom Bank). In France, if the General Union presented ostensibly as a Catholic credit institution, today, social finance (non-religious ethical finance) seems to have completely replaced Christian finance (e.g. Credit coopératif, Caisses de crédit municipal). However, with regard to ethical principles implemented and their historically Catholic origin, many actors of the solidarity finance can be attached to the category of Christian finance ("Catho-compatible players").

Financial products

If certain financial transactions were explicitly condemned because they circumvented the prohibition of usury (e.g. Mohatra contract), the operations of contemporary Catholic bank is characterized by their search for solidarity and the distribution of benefits in favor of the poor. For example, Liga Bank offers credit cards whose commissions are donated to charities supporting children.

Principles

As with

Islamic finance Islamic banking, Islamic finance ( ''masrifiyya 'islamia''), or Sharia-compliant finance is banking or financing activity that complies with Sharia (Islamic law) and its practical application through the development of Islamic economics. Some ...

, Catholic finance aims to supervise banking operations and financial activities with moral principles directly from the interpretation of Christian religious texts (

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) and from the doctrine of the

Roman Catholic Church The Catholic Church (), also known as the Roman Catholic Church, is the List of Christian denominations by number of members, largest Christian church, with 1.27 to 1.41 billion baptized Catholics Catholic Church by country, worldwid ...

(Treaty of virtues and vices,

Catholic social teaching Catholic social teaching (CST) is an area of Catholic doctrine which is concerned with human dignity and the common good in society. It addresses oppression, the role of the state, subsidiarity, social organization, social justice, and w ...

). Also, since the subprime financial crisis, it was found that the

Pontifical Council for Justice and Peace The Pontifical Council for Justice and Peace (''Justitia et Pax'') was a pontifical council of the Roman Curia dedicated to "action-oriented studies" for the international promotion of justice, peace, and human rights from the perspective of the ...

took more often positions on financial matters. In October 2011, someone published a note "Reform of the international financial system with a view toward a general public Authority". In his book "Catholic Finance" (in French: “Finance catholique”), Dr. Antoine Cuny de la Verryère presents seven principles for a Catholic finance (named "princificats"). Some of them are inspired from the principles of Islamic finance: prohibition of short-termism, prohibition of non-virtuous investment, obligation to give priority to virtuous savings, prohibition of unjust profits, obligation to share profits, obligation of transparency, and obligation of financial exemplary.

Worldwide development

Europe

The Christian Finance Observatory ("OFCCFO"), a non-profit international organization, gathering professionals of Christian ethical finance, announced in 2015 the publication of a "Fundamental Charter of Christian Ethical Finance". The Charter considers the various schools of Christian thoughts (Protestant, Catholic and Orthodox) on financial matters and is available in many languages. Beyond general principles, the Charter set out a practical codification of financial practices, and makes sorting between practices considered as virtuous and those considered as non-virtuous. The drafting committee brought together participants from several countries (Belgium, Luxembourg, Switzerland, Germany and France).

United States

S&P Dow Jones Indices created in August 2015 a new index that excludes companies apparently involved in activities that are deemed inconsistent with Catholic values. The OFCCFO's EXCELSIS Rating Committee considered that the product "S&P 500 Catholic Values Index" is eligible to the Quality Label EXCELSIS, rating should be "B−" (best is A+, worst is C−).

Eastern Orthodox finance

According to Russian press, a group of businessmen have started working December 2014 to the creation of an Orthodox bank and investment fund.

Archpriest The ecclesiastical title of archpriest or archpresbyter belongs to certain priests with supervisory duties over a number of parishes. The term is most often used in Eastern Orthodoxy and the Eastern Catholic Churches and may be somewhat analogo ...

Vsevolod Chaplin has welcomed the project because it would rectify usurious mechanisms.

Notes and references

{{Reflist, 2 Christian ethics

Finance Finance refers to monetary resources and to the study and Academic discipline, discipline of money, currency, assets and Liability (financial accounting), liabilities. As a subject of study, is a field of Business administration, Business Admin ...

Financial services