“Oh, you need a loan to buy a new car? Check out Penn-Atlantic Credit Union. They’re practically giving money away!”

With interest rates of less than half of what is typically offered by a conventional bank, credit unions are a practical and popular choice for many consumers. Credit unions can give these low rates because they are non-profit and cooperatively owned. In order to borrow from a credit union, you must first be a member; every member is a partial owner, with both a financial stake and a vote in how it is run. This arrangement, however, presents a serious halachic concern: ribbis, the Torah prohibition against borrowing and lending of money with interest.

In truth, there is a similar ribbis concern in many bank loans. Mutual savings banks are structured similarly to credit unions; each depositor is a partial owner. The bank essentially acts as a shadchan between the many owners […]