(Mishnah) - question: What is Neshech (Torah-prohibited taking of interest) and what is Tarbis (Rabbinically-prohibited taking of interest)?

What is Neshech? One who lends a selah (= 4 dinars) to be paid back 5 dinars or 2 seah of wheat for 3. These bite into the borrower (taking back more than he borrowed).

What is Tarbis? When a person increases the produce in business...

How is this? If he bought wheat for the price of a kur of wheat for one golden dinar (25 silver dinars) which was the current price;

If the price rose to 30 silver dinars per kur and the buyer told the seller, "Give me the wheat that I bought from you as I wish to sell them and buy wine''. If the seller replied, "The wheat that I owe should be like a 30 dinar debt that I will now owe you in the form of wine''. If he does not have the wine, (he may not do this, because he is ultimately giving the buyer back more than he originally paid for. This case only involves a Rabbinic prohibition of ribis - charging interest, since the Torah prohibition only applies to a loan but not to business dealings.)

If Reuven lent Shimon money, he may not live in Shimon's courtyard for free nor may he rent from him for a reduced price because of the loan.

(Gemara) - R. Yanai: This (first case in the Mishnah) is a case of ribis that the borrower (if he had paid it) can take the lender to Beis Din to force him to reimburse it.

Question to R. Yochanan: But can ribis that was charged be later extracted from the lender in Beis Din?

Answer (R. Yochanan): If we would do this, we would not leave anything for the rich people of Eretz Yisrael! (In this way, R. Yochanan was ruling that it cannot later be extracted in Beis Din, as otherwise, why would there still be rich people in Eretz Yisrael?!)

However, R. Yochanan agrees that if the borrower paid back the loan with ribis and he had taken another loan from him as well, he cannot turn that ribis payment into the payment of the other loan.

R. Yochanan (also) agrees that if the document (of a loan) still exists (as he had only paid the ribis but not yet paid the principal of that loan), he may do this (i.e. reduce the payment of the principal according to the ribis already paid).

The Mishnah taught: What is Tarbis?

Beraisa - R. Meir: If a Jew lent another Jew for ribis, the lender may not collect the principal payment nor the ribis. (This is done as a penalty measure).

Chachamim: He may collect the principal but not the ribis.

Question: The pasuk states (Vayikra 25, 37), "Do not give your money in neshech (and do not give your food in marbis)''. This only teaches the prohibition of neshech with money and ribis with food...What about neshech with food and ribis with money?

Answer: The previous pasuk states, "Do not take from him neshech and tarbis'' - we compare neshech and tarbis to each other - Just as neshech applies to money, so tarbis applies to money; just as tarbis applies to food, so neshech applies to food.