Verse 8.140 [Rates of Interest]

Sanskrit text, Unicode transliteration and English translation by Ganganath Jha:

वसिष्ठविहितां वृद्धिं सृजेद् वित्तविवर्धिनीम् ।
अशीतिभागं गृह्णीयान् मासाद् वार्धुषिकः शते ॥ १४० ॥

vasiṣṭhavihitāṃ vṛddhiṃ sṛjed vittavivardhinīm |
aśītibhāgaṃ gṛhṇīyān māsād vārdhuṣikaḥ śate || 140 ||

The money-lender shall stipulate an interest sanctioned by Vasiṣṭha, for increasing the capital. He shall take monthly the eightieth part of a hundred.—(140)

 

Medhātithi’s commentary (manubhāṣya):

‘He shall take, etc.’ (the second half of the verse) represents the injunction; and what is said regarding its being ‘sanctioned by Vasiṣṭha’ is merely commendatory;—the sense being that ‘Vasiṣṭha, the revered sage, cognisant of all that happens at the three points of time and devoid of greed, accepted interest, hence it is commendable.’ ‘By its means one’s capital increases, and yet there is no impropriety in it on the ground of its being indicative of greed.

‘Stipulate,’—Employ; at the time that he is advancing money to the debtor, he should clearly stipulate the rate of interest.

In the case of all things that can be counted or measured,—such as clothes, grains, gold and so forth- the rate of interest is to be as here laid down. In the case of liquor, however, the rate of interest has been declared to be eight times of the principal,—and this is an exception to the limit that the total amount of the debt shall not exceed the double of the principal, as we shall explain later on.—(140)

 

Explanatory notes by Ganganath Jha

This rule, here attributed to Vasiṣṭha, actually occurs in Vasiṣṭha-Dharmaśāstra, 2.51.

“According to Kullūka, (on 142), Nārāyaṇa, Rāghavānanda and Nandana, this rule refers to a debt secured by a pledge, find the correctness of this view is proved by the parallel passage of Yājñavalkya (2.37).”—Buhler.

This verse is quoted in Vivādaratnākara, p. 7, which explains ‘māsāt’ as ‘after the lapse of one month,’ and adds that this refers to debt that is secured by a pledge that can be enjoyed (by the creditor).

Smṛtitattva (p. 349) quotes the second half and adds that ‘of 100 kārṣāpaṇas’, the ‘eightieth part’ would be 20 paṇas.

It is quoted in Prāyaścittaviveka (p. 420), which explains ‘aśītibhāgam’ as 20 paṇas;—in Smṛtisāroddhāra (p. 325);—and in Vīramitrodaya (Vyavahāra, 91b), which says that this refers to cases of mortgage, and the meaning is that when 100 rupees have been advanced, the creditor should charge 1¼ rupee after the lapse of one month.

 

Comparative notes by various authors

(verses 8.140-142)

Gautama (12.29-30).—‘The legal interest for money lent is five māṣas a month for twenty kārṣāpaṇas. Some declare that this rate should not he paid longer than one year.’

Vaśiṣṭha (2.48).—‘They quote the following—2, 3, 4 or 5, in the hundred, he may take as interest per month, according to the order of the castes.’

Vaśiṣṭha (2.51).—‘The interest for a money-lender declared by Vaśiṣṭha is five māṣas for twenty Kāṛṣāpanas, per month.’

Yājñavalkya (2.37).—‘In the case of loans with pledges, the interest per month shall be the eightieth part; in those without pledges, it shall be 2, 3, 4 or 5 per cent, respectively for the Brāhmaṇa, the Kṣatriya, the Vaiśya and the Śūdra.’

Nārada (1.99-101).—‘Let a money-lender take, in addition to the principal, the interest fixed by Vaśiṣṭha, viz., an eightieth part of a hundred every month. 2, 3, or 5 (in the hundred) is the legitimate rate of interest; let him take as much in the shape of interest, every month, in the direct order of the four castes. Or let him take 2 in the 100, remembering the practice of the virtuous.

Bṛhaspati (11.3).—‘An eightieth part of the principal accrues as interest on it every month; and it is doubled by such interest within six years and eight months.’

Artha-Śāstra (p. 61).—‘The legal interest, per month, on every 100 Paṇas, is 1¼ Paṇas; it is 5 Paṇas in business transactions; 10 Paṇas for people trading in forests; and 20 Paṇas for those trading on the seas.’

Viṣṇu (6.1-5).—‘A creditor shall receive his principal back from his debtor exactly as he had lent it to him. As regards interest, he shall take, in the direct order of the castes, 2, 3, 4 or 5 percent., per month, if no pledge has been given; or the debtor of any caste may pay as much as has been promised by him. After the lapse of one year, let them pay interest according to the afore-mentioned rule, even though it may not have been agreed upon. By the use of the pledge, interest becomes forfeited.’