History of Indian currency

Take a walk through the history of Indian currency notes and see how it has changed over the years.

History of Indian currency

The new 100-rupee note was the latest currency note with a new look that India adopted after demonetisation. The vibrant lavender note, released by the central bank – Reserve Bank of India, features Gujarat’s UNESCO World Heritage Site Rani Ki Vav. Today, currency is issued under the RBI Act 1934. It is just a small addition to the long line of notes and coins that have been in use in India throughout its history. Indeed, the history of Indian currency is almost as old as the history of the country itself.

The word ‘Rupee’ is said to have evolved from the Sanskrit word for coin, ‘Rupya’ and also the Sanskrit word for silver, ‘Raupya’. Needless to say, silver was one of the most recognised forms of currency alongside paper money and coins of other metals like gold, copper, bronze etc. Ancient Indians were one of the earliest users of coins as money, along with China and Mesopotamia. Cowrie shells were also another accepted form of money, up until a few centuries ago. 

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If we plot the journey of the Indian currency in a historical timeline, it would be in the following order:

6th Century BC – Irregularly shaped coins issued by various kingdoms such as Saurashtra, Dakshin Panchala, Magadha etc. around this time. Made mostly of silver, the coins were somewhat shapeless, but they had distinct marks like floral patterns, animals, religious symbols, etc.

4th to 2ndCentury BC – This period belonged to the Maurya dynasty. Mauryan coins generally weighed around 3 grams and had specific marks like the Sun and a six-armed God. These coins were mostly circular, with a few of them being rectangular/square. It is safe to say that the history of Indian coins took shape during this period, as did their physical shape.

1st Century AD – The Kushans brought the Greek tradition of imprinting portraits on their coins. By this time, gold, silver, copper, and lead were popular choices for minting coins. Kushan coins had elaborate imprints of Bactrian legends and kings holding weapons or other objects and complete with scriptures in the sides of the coin. In a way, modern-day coins continue to follow the Kushan blueprint.

12th Century AD – The rule of the Turkish sultanate saw a departure from the imprint of Indian kings and introduced Islamic calligraphy, a tradition that their more illustrious successors continued. High-value coins of this era were called ‘Tanka’ and were made of gold, silver, and copper, while coins of lesser value were called ‘Jitals’.

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1540-45 – Sher Shah Suri’s five-year reign is significant in the history of Indian money. He introduced a new consolidated currency in the country, which withstood changes in reign and survived even up till the early days of British rule. Coins issued by Suri were made of silver and weighed around 11 grams. He named them ‘Rupiya’. 

Mughal Era – The Mughal era silver coins were called Tankas or Shahrukhis and assumed different imprints as the rulers changed. Parallel to these, however, Sher Shah Suri’s Rupiya legacy continued. Shahrukhis always had Islamic calligraphy imprints and were made of silver, except for the copper coins minted during the reign of Humayun and Akbar.

1717 – Mughal currency remained prevalent even as the East India Company rule started – until Mughal emperor Farrukhsiyar gave permission to the British to mint Mughal coins at the Bombay mint. The British started minting coins from gold, silver, copper, and tin.

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1770-1832 – India adopted paper money for the first time in India under early financial institutions like Bank of Hindostan, General Bank of Bengal and Bihar, and the Bengal Bank. It was a time when both semi-government and private banks could issue currency notes. Financial instruments like hundis, shares, and bonds also started appearing in the Indian money market. 

1835 – The year witnessed the passing of the CoinageAct. This act standardised the currency for undivided India and as Mughal Empire wound up in the next few decades, portraits of British royalties made their first appearance on the rupee, notably Queen Victoria, King Edward VII and King George V.

1935 – The Reserve Bank of India was established as the central bank and empowered to issue money for the Government of India, an arrangement that exists to this day. 

1938 – RBI issued its first note, Rs 5 note with the portrait of King George VI in the month of January. In the following month, it issued notes of denominations Rs 10, Rs 100, Rs 1000 and Rs 10,000. 

1940 – The Rs 1 note was reissued in this year. The note was first issued in 1917 but was discontinued in 1926.

 

1947-50 – With independence, the Lion Capital of Sarnath was introduced as the national emblem, which replaced portraits of British monarchs. The first post-independence currency was the one-rupee note.

1953 – This was a landmark year as Hindi language was used prominently on the new notes. In the following year, higher denomination notes of Rs 1000, Rs 5000 and Rs 10,000 were reintroduced, which had been discontinued in the previous years.

1980 – Symbolising advancement of the country, new noted were introduced with symbol of science, technology, oil rigs and various Indian art forms.

1988 – This year saw the introduction of stainless steel coins for the first time. 10, 25 and 50 paise coins were issued.

1992 – RBI issues Re 1 and Rs 5 stainless steel coins.

1996 – The smiling Mahatma series was first introduced in 1996, which remains to this day. The picture was taken from an actual photograph of his, taken alongside British politician Lord Frederick William Pethick-Lawrence.

Since 1996, various objects have featured on Indian currency notes, such as the Indian parliament, the Himalayas, etc. After demonetisation, we saw the introduction of the new 500 and 2000 rupee notes in 2016, 200 rupee notes in 2017, and 50 and 100 rupee notes in 2018. 




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