What would be some of the features of a Catholic economic and banking system, in which no interest is charged, and the only assessment beyond the face value of the money being repaid, would be things such as administrative fees, paying salaries to the people who run the system (bank employees, mortgage originators, et al), physical plant for the bank, and so on?

First of all, depositors would put their money in the bank, but it would only be for safekeeping and trust purposes, a safer alternative to keeping the money in one's home.  Then they could write checks on the money, have it put into electronic form, and so on.  Credit cards would exist, but only as a promise of future payment of the money being borrowed, with, again, anything above the face value of the money would only be administrative and service fees, with no interest element and no concept of "time value of money" or compensation for risk.

Mortgages would work the same way.  They would be zero interest, again, the money loaned to buy the house coming from savings deposits made by bank customers.  The mortgagor would pay, for a 30-year loan, 1/360th of the original principal balance, plus the non-interest fees I described above.  There could also be a premium of sorts to reimburse the bank for foreclosures, IOW, the entire pool of borrowers paying into a fund that would make the bank good for the money they are bound to lose in those 1 to 2 percent of loans that could be foreseen not to be repaid (one would hope, for reasons beyond the control of the borrower, such as financial catastrophe, death of the breadwinner, and so on).  And perhaps "foreclosure" isn't the best word --- I would hope such a bank would work to keep innocent people who have fallen into penury (widows, orphans, those who have been injured or fall sick and cannot work to repay the loan) in their homes, and not be put out into the street.  It would not be to keep "bounders" who simply don't pay back their loans in possession of their houses --- those homes would be fair game for repossession by the bank and sale to someone else.

The "pump-priming" money to get the bank started could come from the sovereign government (either a Catholic monarchy or commonwealth), and would be paid back as the bank began to receive deposits from customers.  In this system, the sovereign would coin money (or issue fiat money, assuming a sovereign has the right to do so) commensurate with the growth of the economy and the value added by an ever-increasing population, not some sort of private reserve bank that creates money out of thin air, such as the Fed.

The only catch here, would be that you couldn't have every customer of the bank wake up one morning and decide to go down to the bank and take out all their money, as there would no longer be enough money to make new loans.

I'm very likely missing some of the "moving parts" here, so I'll welcome input.  

Thoughts from the forum?

“Electronic form” is dangerous for many reasons.  No credit cards either.  Dont spend money you don’t have.  All this is being used to eliminate cash.  Many on welfare are using cards and cell phones to buy.  There is talk about bartering already.

Eliminate the federal evil reserve.

Go back to basic traditional banking where physical money is in the bank. 

Sometimes it's a practical necessity, or at least it helps with bookkeeping both by buyer and seller.  Back in the day, a lot of people ran a tab at the corner grocery store and similar retailers.  I seriously doubt they charged interest.  It was just the neighborly, customer-friendly thing to do.  You settled up at the end of the month, or if you couldn't, well, the shopkeeper would work with you.  He wants to keep customers.

And as for mortgages, who has the money to buy a house cash in hand?  Certainly young families wouldn't.  My proposal is for zero-interest loans where the principal is paid back over time, as opposed to amortization where it's almost all interest and almost no principal at the outset, and then those ratios descend in a kind of curve (picture a graph).

What I envision is a kind of mutual benefit society, in which there is a gentleman's understanding that the money I deposit for safekeeping, indeed my own savings, is being used now to help people who need loans, and that all of the depositors won't go down and take out their money all at once.

Agreed about the federal reserve.  Note what I said about the sovereign issuing money, not an independent entity.  

How about credit unions?

My first use of a credit union was in early 1970’s. It was a combined 3 public hospitals in close proximity to each other and it had an office at the hospital where I worked.

I have since attempted to use credit unions in preference to banks. They are member owned and provide better terms and members have a common interest.

Sadly, the CU’s we used have gone the way of the world, i.e. become banks.

See The Case for Cathic Crudit Unions
https//:catholiccua.blog/

I am very much a "fan" of credit unions, and I do my everyday banking through one, as does my mother.  I have had too many bad experiences with profit-oriented commercial banks, poor bookkeeping and lack of accountability.

I am being forced to engage with a bank for estate and trust matters, but that is simply because there are few financial institutions in our area that are willing to do both.  My prospective bank is a small entity, very much "good old boy" Southern, and confined to the middle part of our state, so it is not nearly as fearsome as one of these huge nationwide banks to whom you're just a number.

How about credit unions?

My first use of a credit union was in early 1970’s. It was a combined 3 public hospitals in close proximity to each other and it had an office at the hospital where I worked.

I have since attempted to use credit unions in preference to banks. They are member owned and provide better terms and members have a common interest.

Sadly, the CU’s we used have gone the way of the world, i.e. become banks.

See The Case for Cathic Crudit Unions
https//:catholiccua.blog/

I too have been using a CU since the '70's when St Stanislaus Credit Union was introduced at our church.  Yes they do have better rates
Unfortunately, they did away with the books and when to statements a couple years ago which you now have to pay for along with every little transaction, but I still prefer them as staff doesn't change so often and it's still member owned.

What about Catholic Cooperatives?

Here is an interesting article which refers to the concept and cites the Spanish Mondragon, built on Catholic concepts. I wonder if Drolo can give us his thoughts on this venture?

Bear with the writer, and his references (praises) of Cdl Cardijn and Bergoglio. There is still some good information and food for thought here:

https://www.americamagazine.org/politics-society/2016/08/04/why-are-catholics-so-good-creating-co-ops

Those would be good too.

The concept dovetails nicely with such things as the principle of subsidiarity, guilds, solidarism, and so on.

The way business is done in parts of the Southern United States, as well as some small towns, based not so much upon getting the absolute most bang for your buck, but establishing relationships and doing business with the people you know (or who know people you know, and so on), is also something that is very compatible with Catholic social doctrine.  When my parents first moved to the South, they had a neighbor who had a lawn care firm.  The neighbor offered his services.  They got someone else.  The neighbors got chilly.  I explained to them that you can't bring the ways you're used to down here --- efficiency, going for the lowest cost, everything being about the "bottom line" --- and expect people to like you, that this is the South and relationships mean everything.  If you move in next door to the town grocer, and go 15 miles down the road to Walmart for all your groceries, you're not going to be his favorite person.  That's money out of his pocket.

“Electronic form” is dangerous for many reasons.  No credit cards either.  Dont spend money you don’t have.  All this is being used to eliminate cash.  Many on welfare are using cards and cell phones to buy.  There is talk about bartering already.

Eliminate the federal evil reserve.

Go back to basic traditional banking where physical money is in the bank. 

Yes.  Electronic form is recorded on Blockchain which is the foundation of the Financial Great Reset and UN ESG score social credit system.

See the WEF website for loads of info on that.

They are implementing this system little by little world wide, including Russia, China, Brazil....everywhere.

Steve Bannon and Alex Jones are luring "conservatives" and "patriots" into this trap:

8mins
https://hugotalks.com/2022/08/11/they-are-playing-you-like-a-fiddle-%f0%9f%8e%bb-hugo-talks/