Zinskauf (, "purchase interest") was a financial instrument, similar to an

annuity In investment, an annuity is a series of payments made at equal intervals.Kellison, Stephen G. (1970). ''The Theory of Interest''. Homewood, Illinois: Richard D. Irwin, Inc. p. 45 Examples of annuities are regular deposits to a savings account, ...

, that rose to prominence in the

Middle Ages In the history of Europe, the Middle Ages or medieval period lasted approximately from the late 5th to the late 15th centuries, similar to the post-classical period of global history. It began with the fall of the Western Roman Empire ...

. The

decline of the Byzantine Empire The Byzantine Empire experienced several cycles of growth and decay over the course of nearly a thousand years, including major losses during the Early Muslim conquests of the 7th century. However, modern historians generally agree that the star ...

led to a growth of capital in

Europe Europe is a large peninsula conventionally considered a continent in its own right because of its great physical size and the weight of its history and traditions. Europe is also considered a subcontinent of Eurasia and it is located entirel ...

, so the

Catholic Church The Catholic Church, also known as the Roman Catholic Church, is the largest Christian church, with 1.3 billion baptized Catholics worldwide . It is among the world's oldest and largest international institutions, and has played a ...

tolerated ''zinskauf'' as a way to avoid prohibitions on

usury Usury () is the practice of making unethical or immoral monetary loans that unfairly enrich 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 c ...

. Since ''zinskauf'' was an exchange of a fixed amount of money for annual income it was considered a sale rather than a loan.

Martin Luther Martin Luther (; ; 10 November 1483 – 18 February 1546) was a German priest, theologian, author, hymnwriter, and professor, and Augustinian friar. He is the seminal figure of the Protestant Reformation and the namesake of Lutherani ...

made ''zinskauf'' a subject of his ''Treatise on Usury'' and his ''Sermon on Trade and Usury'' and criticized clerics of the

for violating the spirit if not the letter of usury laws. In one historian's analysis:

References

Medieval economics {{Finance-stub