user4334: Are loans with interest possible in Bitcoin, such that repayment is enforceably encoded with Bitcoin Script on the blockchain from the establishment of the lending contract?

user2306: It's absolutely possible to loan money with Bitcoin. FairShareLoans is a subreddit where money is automatically loaned out in ~20$ increments.
Collecting on those loans, on the other hand, is more difficult. https://www.reddit.com/r/FairShareLoans/comments/35vc5s/the_current_loansheet/ They appear to have a non-repayment rate of about ten percent.

user7299: What do you mean by "loans with interest"? If you mean guaranteeing being
payed back the principal plus some interest that is not possible since 
that depends on the external world (i.e. it is offchain).
On the other hand, if you mean just creating repayment links for the agreed amounts it is just following the instructions of BIP21.

user5406: Script is employed to encode the rules under which a Transaction Output may be spent. E.g. the most common Script requires just proof of control over an address. Thusly, scripts cannot determine circumstances beyond a single transaction.
As a consequence, it appears to be infeasible to set up an enforceable credit contract with interest, because the loan repayment would lock in an amount of bitcoins greater than the loan. Evidently, the borrowing party doesn't have that amount of money to render unspendable at this time, or otherwise they wouldn't be borrowing in the first place.
Lending offchain is possible, but very fraud prone due to it being hard to enforce repayment. Also see: Why there's no bank or institution lending Bitcoins?

4334: <p>Are loans with interest possible in Bitcoin, such that repayment is enforceably encoded with Bitcoin <a href="http://chimera.labs.oreilly.com/books/1234000001802/ch05.html#tx_script" rel="nofollow">Script</a> on the blockchain from the establishment of the lending contract?</p>
 2306: <p>It's absolutely possible to loan money with Bitcoin. <a href="https://www.reddit.com/r/FairShareLoans/" rel="nofollow">FairShareLoans</a> is a subreddit where money is automatically loaned out in ~20$ increments.</p>

<p>Collecting on those loans, on the other hand, is more difficult. <a href="https://www.reddit.com/r/FairShareLoans/comments/35vc5s/the_current_loansheet/" rel="nofollow">https://www.reddit.com/r/FairShareLoans/comments/35vc5s/the_current_loansheet/</a> They appear to have a non-repayment rate of about ten percent.</p>
 7299: <p>What do you mean by "loans with interest"? If you mean guaranteeing being
payed back the principal plus some interest that is not possible since 
that depends on the external world (i.e. it is offchain).</p>

<p>On the other hand, if you mean just creating repayment links for the agreed amounts it is just following the instructions of <a href="https://en.bitcoin.it/wiki/BIP_0021" rel="nofollow">BIP21</a>.</p>
 5406: <p>Script is employed to encode the rules under which a Transaction Output may be spent. E.g. the most common Script requires just proof of control over an address. Thusly, scripts cannot determine circumstances beyond a single transaction.</p>

<p>As a consequence, it appears to be infeasible to set up an enforceable credit contract with interest, because the loan repayment would lock in an amount of bitcoins greater than the loan. Evidently, the borrowing party doesn't have that amount of money to render unspendable at this time, or otherwise they wouldn't be borrowing in the first place.</p>

<p>Lending offchain is possible, but very fraud prone due to it being hard to enforce repayment. Also see: <a href="https://bitcoin.stackexchange.com/q/11392/5406">Why there's no bank or institution lending Bitcoins?</a></p>
