Interest-Bearing Capital: The Distinctive Marxist Approach

Abstract

The concept of commercial credit, that is, the sale of commodities against promises to pay that are subsequently settled by the payment of money, was introduced in Chapter 2. Commercial credit emerges spontaneously and continuously across the surface of capitalist exchange. Equivalently, capitalist sellers and buyers typically become creditors and debtors in the normal course of capitalist accumulation. Commercial credit relations form the necessary background for the emergence of the capitalist credit system, as Chapter 4 explains in detail. In analytical and practical terms, moreover, commercial credit serves as the foundation for banking (or monetary) credit, the other major and distinct form of credit. Banking credit refers to the lending of money itself on condition of repayment plus interest, and is considerably more complex than commercial credit (though the two also overlap). Banking credit relations give a clear content to the capitalist categories of interest and interest-bearing capital, the latter being a special type of capital remunerated through the payment of interest.