Debt forgiveness

Can God forgive debts (especially financial debts)? 
Very earthly institutions like banks or governments are not at all inclined to doing it, how could a spiritual entity like God accomplish such a task? 

Well, Semitic gods always did! The solar god Šamaš instructed king Hammurapi (King of Babylon in 18th century B.C.E.) to institute a debt amnesty in his famous legislation. Similar institutions are known from other Ancient Near Eastern instances. The Judeo-Christian tradition preserved and continued these ideas which are as old as our civilisation.
Americans pride themselves to be special people of faith. Let us then, have a look at the social and economic system which is envisioned in the Bible. The Torah (The Law of God) puts forward clear divine economic principles - they might be surprising reading for many!

       No interest allowed: One commandment of the Law after another forbids charging any interest (not only usury, simply any interest). For instance: You must not lend on interest to your neighbour, whether the loan be of money, of food, or of anything else that may earn interest. (Deuteronomy 23:19)

       Collaterals regulated: Several independent commandments of the Law strictly regulate collaterals on loans with intention to control potential social consequences. For instance: No one may take a mill or a millstone in pledge; that would be to take life itself in pledge. (Deuteronomy 24:6)

       Regular remission of debts: Long outstanding loans and loans which became unrepayable must not become an outstanding burdens to society. Rather than bankruptcy, the Law suggests regular remission of outstanding debts through the institution of the amnesty of the seventh year. At the end of every seventh year you must cancel all your debts. And this is how it must be done. Creditors must cancel the loans they have made to their neighbours. They must not demand payment from their neighbours or relatives, for the LORD's time of release has arrived. (Deuteronomy 15:1f.)

       Regular manumission of debt-slaves: The same institution of the seventh year also applies to freeing debt slaves. For instance: If you purchase an Israelite man or woman as your slave and serves you for six years, in the seventh year you must set that slave free. And when you send them free, you will not send them out empty-handed. (Deuteronomy 15:12f)

        Regular reversal of dispossession: In agricultural society a land ownership was a major source of wealth. The Law attempted to control growing disparity between rich and poor by instituting a Year of Jubilee - every fiftieth year all the property was restituted to its original owners or their heirs. And you shall consecrate the fiftieth year and you shall proclaim liberty... It shall be a jubilee for you: you shall return, every one of you, to your property... (Leviticus 25:10) 

          I know well enough, that there are serious scholarly doubts whether these rules had ever been fully put in practice. I know that in the realities of our everyday life and economy these rules look quite impractical. Perhaps they were never intended to be put in practice in this form. Perhaps, they were aspirational,  intended to represent an ideal alternative, and offering us a new perspective. 
          Using the tools of these economic commandments, God directs our attention to true values of a strong resilient society: Mutual responsibility, caring for each other, respecting the dignity of the weak and poor, protecting those who are most vulnerable, encouraging the strong ones to care for the weak ones, because with the twist of fortune they may trade their places.
          Our current human economy is propelled by fear and it trades with debts and shortages. It is governed by mortgages, indebtedness and financial enslavements. The divine Law presents to us an alternative, new (no matter how old!) model of economy, which is based on joy and it shares all the available abundance. 
          So if you ask me, whether God can forgive debts, I say: Indeed God can! If only people took God seriously, and recognized that happy and harmonious society cannot be built and cannot prosper on principals of selfishness, rampant individualism and egotism, but rather on ancient principals handed to us in the divine law.
Forgive us our debts as we forgive our debtors - this is an anxious, eager and earnest prayer for the divine year of JUBILEE!

King Hammurapi (standing) receives divine laws from seated god Šamaš