Interest is the cost of borrowing money. The borrower pays to the creditor a pre-determined amount for the use of borrowed money. This amount is the interest. You may take is as a sort of "rent" paid for the use of money belonging to someone else. The history of interest is as old as the human civilization, and references are available to indicate that in ancient time too some form of interest, may be in kind, was in vogue for use of other person's assets and resources.
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