Q: I lent with interest before I was aware of the prohibition. What should I do now?

A: A person who lent with interest may not collect it, even if the borrower says he is giving the interest as a gift. This applies even to interest prohibited by the Sages (Y.D. 160:5; Shach 160:6). If the lender already collected the interest, there is a difference between ribbis prohibited by the Torah and that prohibited by the Sages. There is an obligation to return ribbis prohibited by the Torah – a loan with guaranteed interest (ribbis ketzutza) – even if the borrower willingly gave the interest. There is even legal recourse through Beis Din to force the lender to return the interest (Y.D. 161:5; Pischei Teshuva 161:5). If the borrower decides to forgo (mochel) the interest that he paid, though, his decision is valid, like with any other theft (Y.D. 160:5). If the lender earned a significant portion of his livelihood through ribbis and repents of his own accord, it is even recommended to forgo the interest, so as not to dissuade him from repentance (Y.D. 161:7). However, if the ribbis was prohibited by the Sages, Beis Din will not enforce returning the interest, but there is a moral obligation to return it according to most authorities (Y.D. 161:2; Pischei Teshuva 161:4).