Which of the following phrases defines the nature of the 'Hundi' generally referred to in the sources of the post-Harsha period?

An advisory issued by the king to his subordinates

A diary to be maintained for daily accounts

A bill of exchange

An order from the feudal lord to his subordinates

APEDIA

UPSC Prelims

2020 • 04 Oct, 2020 • Paper-1

Which of the following phrases defines the nature of the 'Hundi' generally referred to in the sources of the post-Harsha period?

Correct Answer

A bill of exchange

Economic Context: In ancient and medieval India, as trade expanded over vast geographic areas, carrying large amounts of metallic currency became dangerous due ......

💡 Analysis & Explanation

Economic Context ▼

In ancient and medieval India, as trade expanded over vast geographic areas, carrying large amounts of metallic currency became dangerous due to the risk of banditry.

Definition of Hundi ▼

A 'Hundi' was an indigenous financial instrument developed by Indian merchants. It functioned essentially as a bill of exchange, a credit note, or a promissory note.

Mechanism ▼

A merchant in one city could deposit money with a local banker, receive a Hundi, and present it to an associate banker in a distant city to receive the equivalent amount, greatly facilitating long-distance trade.

Conclusion ▼

The primary historical and economic definition of a Hundi is 'a bill of exchange'.

Choose Language

See you soon!

Which of the following phrases defines the nature of the 'Hundi' generally referred to in the sources of the post-Harsha period?