EARLY EUROPEAN· BANKING IN INDlA

WITH

SOME REFiECTIONS ON PRESENT CONDITIONS . .' . MACMnLAN AND CO .• LiMm:D W~N'OO~Y'~A'MID~S MELBOURNE nm. MACMn..LAN COMPANY NEW YORIC • OOSTON • CHICAGO DAUAS • SAN FIUNCISCO

THE MACMn..LAN CO. OF CANADA. Lm. TORONTO EARLY,. EUROPEAN BANKING , IN INDIA wrm SOME REFLECfIONS ON PRESENT CONDITIONS

BY H. SINHA CERTIFIED ASSOCIATE OF THE INSTITUTE OF BANKERS. LONDON

MACMILLAN AND CO., LIMITED. ST. MARTIN'S STREET, LONDON 1927 II") <) _L X o -- • -- .::;;; F7 COPYRIGHT

Sl4~

Printer: S. C. MAJUMDAR SRI GOURANGA. PRESS 71/1,. Mirza"u, Street. Calcutta. CONTENTS

PREFACE i PART I. History 1 PART II. Reflections on Present Condition 165 INDEX 257

GLOSSARY 270

REFERENCES 272

I. B. Printer: S. C. MAJUMDAR, SRI GoURANGA PREsS, 71 {I, Mirzapur street, Calcutta.

668(26. PREFACE

This work attempts to fill a gap in our knowledge of European . That history is utterly dark in its earliest and most important period. The existing accounts of the subject have been found incomplete and often incorrect in material points. Most of them have repeated the same story and sometime:; the same mistakes. I have, therefore, been obliged to reject all second hand materials of this nature, and to rely on the very raw materials of history, 'Viz., the contemporary State records and newspaper accounts. The Bengal Chamber of Commerce gave me the high privilege of access to its library, which contains extremely I • valuable old documents not to be found anywhere else 1D India. Similarly I was kindly given access to the records and library of the Imperial of India, Calcutta. The manuscript records of the Bengal Government Record Office and of the Imperial Records Office in Calcutta, were examined by me for several years. Copies of documents in the India Office and in the library of the Institute of Bankers, London, were also obtained~ In spite of many gaps in these sources, the material I have been able to collect is so vast that only a portion could be embodied in the present volume. Valuable data have been secured for cognate subjects, e.g., the early history of the Calcutta Money Market, which are outside the scope of the present work. The portions relating to indigenous banking caused me much anxiety. There is no written account, published crunpublished, of this obscure and complex subject to which the student may refer for guidance. In order to study the recent history and the present organisation' of indigenous banking and to trace its connection with European banking, I addressed a questionnaire to many Indian merchants and shroffs in Calcutta and in the I. B. ii

mofussil and also interviewed some of them. In spite of the natural reluctance of business men to divulge their methods of business many new and interesting facts have been elicited in this wr.y, some of which have been incorpoJ;1lted in this book. The consultation of old State records and newspapers was no easy task. Although carefully preserved, they are worm-eaten and pasted over with tissue paper to piece the crumbled portions together. They can be deciphered only with the greatest difficulty. There is no index to the newspapers. Files after files had to be waded through to find an obscure notice in the advertisement columns. The editorials of the time did not as a rule comment on current events, but concerned themselves with learned essays in the style of Bacon, translation of Sanskrit and Persian poems, long accounts of the old Court of Delhi and mail news from English papers. There is an index to the Government records down to 1800, but it is not satisfac­ tory, as is only to be expected from the enormous mass of materials that had to be handled. For instance, the papers relative to a single transaction, 'Viz., the coinage of Spanish dollars into Sicca rupees, are distributed under as many as five headings: -(i) Bank j (ii) Bank of Bengal j (iii) Benjamin Mee (one of the partners of the ) ; (iv) Mint (v) Herbert Harris (Mint Master). It is difficult to compile a connected narrative from isolated references like these. Besides, there are a number of serious errors, not to speak of obvious slips. The Bengal Bank is systematically referred to as the Bank of Bengal with which it bad nothing to do. But by a patient search extending over years, I have been able to discover a number of facts which are now presented together, r believe, for the first time. It has, I hope, been satis- tfactorily established that there was a JoiIit Stock Bank I in India with limited liability long before the incorporation ()f similar institutions in England; that the Bank of Bengal was not the first banker of the Government of India, nor iii

even was its progenitor, the ; that the notes of private were recognised by the Govern­ ment as early as the eighteenth century; that the theft of bank notes was not an offence till the end of 1809 ; that the Government issued papers akin to Treasury Bills to carry on the War in the South with the help of the banks of the time ; that they readily came to the assistance of banks in times of crises; that they appointed a Currency Committee with leading bankers as members as early as the eighteenth century. I have alSo reproduced interesting •specimens of old bank notes, bank post bills and other instruments and have tried to show how far they followed similar instruments in England or the indigenous instruments of the country. An endeavour ' has been made to describe the methods and procedure followed by the pioneers of banking on European lines in India. My only hope is that this account, incomplete as it necessarily is from the disappearance of certain records, will draw the attention of other researchers to the wealth of materials on which I have worked, for the field is wide and the labourers few. In the second part of the book I have attempted to deduce certain conclusions from the events- recorded in the first part and apply them to the present day problems. After this part had been set in type, the report of the Royal Commission on Currency and Finance was published. It is a matter for sincere congratulation that all the members including Sir Purshotamdas Thakurdas emphasise the importance of banking development as the foundation. for a thorough reorganisation of credit and currency. In" this they simply enunciate the lesson taught by the history of the Calcutta Money Market during the last quarter of the eighteenth century as given in the present volume. Grea t stress has also been laid in the book" on the ,importance of the organisation of a discount market under the aegis of a strong central institution. It has been pointed out that cash reserves need no longer be regarded JI. B. iv

as inadequate., if banks. are able to rediscount their holdings of bills freely. This view has received the support of the Commission. There is another point on which all the .. members of the Commission are agreed, 'Viz., that the issue.. of notes should be taken out of the hands of the Govern­ ment. It has been pointed out in the first part of the present volume how Sir James Steuart recommended this n!easure as early as 1772. Lapse of time has not detracted from the strength of his conhntion. There are certain other reforms suggested in the second part, which have also been recommended by the Commission, 'Viz •• the establishment" of a one-reserve system. in fact as well as in name. the abolition of the stamp duty on cheques and the standardisation of indigenous bills of exchange. There is only one point discussed in the second part of this volume which is somewhat at variance with 'the majority report when it states that "the mere fact of putting gold into circulation would not ...... develop the banking and investment habit.," In an abstract senSe this is probably right. But in the peculiar conditions of India. until public confidence is created by a courageous currency reform even amounting to the establishment of a comparatively. expensive gold 'currency, people. will not be weaned from uneconomic habits of hoarding, nor initiated in the use of any form of credit currency. although the notes may bear a double guarantee, that of the Reserve Bank and of the Government of India. It is not excessive pessimism which makes the present writer cherish serious misgivings about the future of the proposed Gold Bullion Standard. Nor is lie convinced by the reasons given bv the Commission for rejecting the scheme prepared by the Finance Department of the Government of India for introducing a . gold standard with gold currency.

Calcutta University, H. S. September. 1926. INDEX.

[Words marked (G.) have been explained in the Glossary.1

ACCOKPTANl; swearing in to AURANGS (G.): remittance to office, 14, 129. mo/ussil, 57-00; financing, AGINCY HouslS: rise in 65· Calcutta, 3,173D; entrust banking to banks, 172-4; propose issue of inconver­ B. S.: stands for "Body tible notes, 87"90. Sheets," SoD. AGItBI!MJ!ST 0' GKNI!RAL BANK : BABINGTON SMITH CuRRI!NCY see Plan of General Bank COMMITTEE: description of 0/ India. complexity of indigenous AGRICULTURAL FINANCI; long banking, 233. 233D; im­ period, 19!r204; short period, Dlense possibility of small 204-208. See also Seasonal deposits, 229, 229n. Stringency in Money Mar­ BANGALORI!; capture of, :101. ket. BANIA (G.): see Bunnea". Ar.iXA.'iDIR AND Co.: found BANK, PROPOSED 3Y ST~UART : Bank 0/ H;ndostan, 4 ; re­ plan, 53-56, 56-57; connec­ lation with Bank 0/ H;ndos­ tion with Government, 52, tan, 4-5. 56. A.uviRDI: stems Marhatta BANK OP BENGAL: chief Presi­ invasion, 2. dency Bank,S; absorbed Ar.LUlAIL'D BANK: amalgama­ into Imperial Bank, 6; tion with P. & O. Banking charter of lSog, IS; balance CorporatioD, 219. sheet· dated January, 1820, AU.IANCI BANK 0' SDO.A; :144'145; theft of notes not failure of, 212-213,. 230. an offence, IsS ; plan, AMATiUR BANXING: by Euro­ 158-161 ; election of first pean firms, 234-5; by Indian directors, 162; appoint- firms, see under Indigenous ment of first officers, :162 ; Banking. first half-year'5 working, AMiRICAN BALANCl-SHI!I!'l'; a :162-163; sources for history typical example, 227D-228n. of, 164; right of issuing AMSTIRDAM; Banking in, notes taken away, 184; res­ compared to banking in triction against foreign ex­ Calcutta, 81-2. change business 186-187; in­ ANDERSON, J. A.: his des­ corporated in charter of cription of S"rolJee busi­ 1839 at Bank's instance, ness, 249. 1870. ANDERSON, WII.I.IAM; Manager BANK OP c.u.CUTTA: (see Bank of Oriental Bank, 150. business, Gvvemment con­ ARATDAIlS (G.): of help ttJ nection with" banks, Notes branch banks in mo/ussil, of Bank 0/ Calctltta, Plan 226. of Bank 0/ Calctltta) ARCOT RUPII (G.): amount progenitor of Bank 0/ plundered by Marllattas Bengal 5 ; date of com- from Jagat Set"'s house, 2. mencement of business, ASSEMBLY, CALcunA: appoint SU, :123, 145 ; reasons Bengal Bank their banker, for establishment, 124-u7, 64· 177; printed plan, 127; busi- E. B. 17 258 ;EARLY EUROPEAN BANKING IN INDIA

ness for permanent bank, BANK DEPOSl'J'S': See Deposit 128-130; estimated expenses, banking; Deposits, Bank. .I30-131 ; estimated profits, BANK FAILURES: of Bank Of l31-133 ; legal difficulties, Hindostan, 5; of Calcutta 134-135; how obviated, 13&- Bank, sn; of Bengal Bank. 137; temporary bank ap­ 12In; of first Benares Bank, proved, 137; chief provi­ 21]U; of AZUance Bank, 2I2- sions, 137-139; application 213, 220; of Bank ot Burma, to Court' of Director~ for 287n, 226n-227n; of Indian sanction, 139-140 j parallel SPecie Bank, 217n; of 1857 from American banking in England, 10 ; effect on history, 140-141 j appoint­ value of Government paper, ment of officers and direc­ II3-n6 ; effect on Govern­ tors, 141-142; withdrawal of ment contractors, II6-n7 ; official subscribers, 142 j effect on holders of Govern­ lottery business, 143-144 ; ment securities generally, business notice, 145-153; re­ II7-n8; lessons of, 212-214. duction in discount rate, BA.."IK FORMS: (see also Indi­ 153-154; appreciation 0 f genous Bank Instruments) Government securities, 154. Bengal Bank Post Bill, 30; BANK OF ENGLAND: charter of Bengal Bank Note, 43; 1694, 14, 15-16, 16n; reason General Bank Note, 44; for introducing post bills, Bank of England Note (first 31; oldest one-pound note, series), 46; water mark, 61; Pro Note prescribed by Bank 45-46. BANK OF FRANCE: banking ot Calcutta, 146; modern development through, 188n. Letter of Lien, 147-148. BANK OF HINDOSTAN: estab­ BANK HOLIDAYS: in 1789, 18. lishment, 4; connection BANK HOURS: of Bengal Bank, General Bank, 18. with Al.exander &' Co., 4-5 j 8; of 'runs,' 5, 107-1og j reduction BANK NOTES: (see also Notes in discount rate, 64-65 j sub­ of Bank ot Bengal, Notes of scription to W~ loan, 93; Bank of Calcutta, Notes of application to Governml:nt Bank ot Hindostan, Notes for assistance, 107-109 ; of Bengal Bank, Notes of granted. II8-II9; loan paid General Bank) intended to off, 120 ; lottery business, effect reform in currency 122-123 j unable to transmit and public finance, la-II, government revenues, 166- 124-127, 127n, 139-140, 140- 167 ; promotes public lec­ 141,154-156, 175, 177, 178- tures, 231n. 179' effect of extinction of, BANK BALANCE SHIlET: earliest, II3~II4 ; believed to cause 156 ; changes necessary, 227- batta, 75, 79; theft not an 231n ; American example, offence, 157-158. 22]U, 228n. . BANK REPORTS: provision in BANK BUSINIlSS: of bank pro­ ,Plan of General Bank, 16; posed by Stellart, 54-55, first half-yearly report, 68- $6-57; . 6g; press comments, 69-71 ; - of Bank ot Htndostan, 93, peculiarities, 71 ; subse­ 23m ; quent reports, 71'72; provi­ _ of Bengal Bank, 6-9, 62-64, sion in Plan of Bank Of 23m ; 21 Bengal, 161; first half-yearly _ of General Bank, 17, 19- , report submitted to Govern­ 65-67, 23m j _ of Bank ot Bengal, 159, 160, ment, 163. 161 ; BANK 'RUNS': on Bank ot _ of Bank of Calcutta, 129, Hindostan, 5, 5n, 107; on 130, 143-144, 145-146,. 148-153 j Bengal Bank, 105-106; coer­ _ of some Indian Jomt Stock cive measures against panic­ banks, 217n. mongers, 209-210. INDEX 259

BANK ScHoas; see Plan of - di1Iereut from Ban" Of Ban" 01 Bengal; Plan of Bengal,s; receives subscrip­ B_" 01 Calcutta; Plan of tion in aid of troops, 6, 64; Bank proposed by ste_ri; high government officials Plan of General Bank. become proprietors, 6; husi­ BANK SBAUS : of General ness notice, 7"9 ; pays off ~ank; amount, II; subscrip­ arrears of military salary on tion open to all, I2; sub­ behalf of Government, 9 ; division of shares, IZ· pre­ protests against preference feren~ right of original to General Bank, 40-41; char­ subscnbers, I2; subscription acter of proprietors, 42-43 ; to be half in cash and half withdrawal of public offi­ in paper, 13; limited liabili­ cials, 61; lottery business, ty, IS, I2; 62-63 ; bankers to public -<>f Bank 01 Calcu.tta; amount bodies, 63-64; receives subs­ and calls, 137. cription for famine relief, 76; coinage of dollars, 103- BANK SUIIS: expeditious pro­ 105; misappropriation, lOS; cess for, 208. suspension of payment, 105; BANKER'S LIEN: di1Iereut from application for assistance ordinary lien, 146n. from government, 105-107; BANJO (G.): necessary inter­ granted, II8; but of no mediary in Japan, 171. avail, II9; failure, 121; con­ B~-YAN (G.): ~f the present fusion in accounts, 121-122; time, 171; m eighteenth payment of dividend, 122; century, 172, 172n-l73n; unable to transmit public evolution, 172-174. revenues, 170; promotes BARRE1'TO, JOSIPH: partner of public lectures, 231n. Barretto 6' Co. and 01 Hin­ doston, Bank, 4-5. BI~GAL INSURANCE OFl'ICI : \ BARRlrto & . Co.: agency submits memorandum of ~ house in eighteenth century, evidence to Hams Commit- • 5· tu, 74. BAnA (G.): pl'Oblem referred BtNGALI MAHAJAH: see Maha­ to !lams Committee, 74-75; jan. beheved to be caused by cir­ BIPARI (G.) : to be sought out culation of General Bank and encouraged by mofussil notes, 75, 79; and by loan branches, 226. policy ~f General Bank, 75; "BIG FIvE": extend oonnec­ responSIble for abolition of tions to India, 219; re- Genn.al Ban~, 79&; and of sources of, 2J4D. . deposIt banking in Amster­ BoNDS: (see also Debentures) dam, 81-82. development of, 202, 254· BAnAS (G.): of European BRANCH BANKING: by bank officers in the Bengal Army, proposed by stevari, 56; lSon. practically unknown to early B~R, RICHARD: appointed Europe1ll1 bankers, 166, 167, dtrector of Bank of Calcutta, 170 ; by indigenous bank 142; attends meetings, 142- under government patron­ 144· age, 167-168; vain shows and BENARIS BANK (first): reason needless expenl'es to be for failure, 2170. avoided, .222-225; new out­ BENGAL B.\NIt; (see also Bank look reqUired, 226; also spe­ business; Bank holidays ; cial features, 226-227; an Bank hours; Cheques; Hay, object lesson, 228-230; quali­ Ed!ll a r tl ; Hmcllman, fications of local manager, Thomas: Hennes, lames; 230-231. Notes of Bengal Bank; Post BROTHERHOOD OF I,ocoMOtlVll Bills of Beflgal Bank; Rider, ENGINEERS CO-OPERATIVlI Jacob). NAtIONAL BANK OF CLEVE- 260 EARLY EUROPEAN BANKING IN INDIA

LAND : a typical balance CHARTERED BANK or INDIA, sheet, 22711-228n. AUSTRALIA AND CHINA: has BUDGETING IN EIGHTEENTH CEN­ no branch in Australia, 221. TURY: discrepancy between CHEQUE: origin, 20n-2In; of estimated and actual re­ Bengal Bank, 7; of General ceipts, 176. Bank, 20-21, 61; stamp duty BURGH, JOHN: appointed on, 208-209; vernacular, 22711. director of General Bank. CHURAWAlLAH (G.): finances 85. ./ consignments to U.P., 242; BUSINESS HOURS: in public rates, 251. offices, 8n; in Bengal Bank, "CLEARING HOUSE LoAN CERTI­ 8; in General Bank, 18. rIC-UE": mdimentary ana­ logue of rediscounting fadlities, 222. CALCUTTA ASSEMBLY: appoint COCKERELL, C.: writes a Bengal Bank their banker.' minute of dissent in Harris 64· Committee report, 75. CALcUTTA. BANK or: see Bank COlMBATORE : faIl of, 102. 01 Calcutta. COMMERCIAL BANKS: limitation CALCUTTA BANK: established of, 191. by Palmer &' Co .• SU. COMMISSION AGENCY-CUM- CALcUTTA EXCHANGE PRIC'!S BANKING: carried on by in­ CURRENT: an early financial digenous firms, 241-242. weekly paper, 149, 14gn. CoMPANY LAW: ,reforms neces­ CASH PERCENTAGE: of General sary, 196-197, 2Il-2I2 (see Bank. 17; of Bank' 01 Cal­ also Regulation of banking cutta. 130 ; of Exchange by government.) Banks, 219n; of Indian Joint COMPRADOR (G.): necessary Stock Banks, 21gn. intermediarv in China, 171. CASHIER: swearing in to CONNECTION BETWEEN GoVERN­ MENT AND BANKS: see Gov­ offire, 14; to hold shares, 24. CAVEAT EMPTOR: policy inimi­ ernment connection with ('al to industrial investment, Banks. CO-OPERATION : opposed to 196-197· or INDIA: sug­ capitalism, 201. gest action against panic­ CO-OPERATIVE CREDIT SOCIE­ mongers, 209-210; absorb TIES : and rural indebted­ Tata Industrial Bank, 223n. ness, 201-202; largely con­ CERTIFICATE, COMPANY'S: dis­ trolled by legislation, 2H- charge through General 212. Bank, 37; loan against, CooTER (G.) : of an indigenous 37-38. banker described, 66n. CHALMBRS, LIEUTENANT: (after­ CORNWALLIS, LoRD: appoints wards MAJOR GENERAL SIR General Bank banker to JOHN CHAlMERS, X.C.B.): in Government, 39; ignores command of fort of Coi"... Bengal Bank's pr~test, 41; batore, 102. puts· down corruption, 42-43; CH.UlBERLAIN Co~IlIfiSSION : withdraws public servants description of ryats, 201. from Bengal Bank, 61; ap­ CHAND, FATEH: receives the points Currency Committee, title of Jagat Seth, I. 74; severs Government con­ CHAND, MAHATAP: wealth of, nection with' General Bank. 2. 7g-80 ; rejects application CHAND, MANIK: awarded the from Chiefs of Agency title of Seth, I. Houses, 91-92; receives ad­ CHAR CHITTY (G.): loan by dress from citizens of Cal­ ./' Bank of Calcutta against, cutta, 93n ; assnmes com­ 148-149· mand of Deccan War, 101; INDEX 261

describes financial embar­ CuRRENCY COMMITTI!B IN 18TH rassment of Government, CENTURY: see Harris Com­ 175-177· mittee. CORRUPTION: in public ser­ CuRRENCY DIP'ICUI,7.IES: see vice, 41-42, 86; in European also Batta; Crisis, Currency; banks, 66-67, 105; in indi­ Managed Currency; Sea­ genous banks, 66n. sonal Stringency. CURRENT RUPBB: expla.ined, COURT 01 DIRECTORS, LBTTI!RS 28n. PROM: prohibiting receipt of bank notes into the trea­ sury, 77. 'D' BANKs: of Germany, 198, CoURT 0' DIRECTORS, LBTTI!RS 198n. J TO: sdvising appointment of DAllSANI HUNDI (G.): (or GeneTal Bank as Govern­ simply daTsani, dl£Tsunny) , ment banker, 39"40; giving amount drawn by Jagat reasons for suspending Seth in one bill, 2 ; pait orders Te ~eceipt of bank form, 33-34; khoko. form, notes, 78; describing cam­ 47,48. paign in the Deccan, 101; DBBBNTUllBS: development of, enumerating legal difficul­ 193-194 (see also Bonds). ties of establishment of DBCCAN WAR: see War, Dec­ Bank 01 Calcutla, 134-137; can. soliciting sanction for a per­ DBPOSIT BANKING: believed to manent bank, 139-140; de;;;­ affect currency, 81-82; con­ cribing financial position of trol over, 2U-213, 214-217. government, 175-177. DEPOSITS, BANK: methods for 'COVERING' IN ExCHANGB: pro­ attracting, 226-231 ; un­ bably known to eighteenth healthy rivalry for, 226n- century bankers, 6JU. 2270; immense possibility Cox, RICHARD WAITB: nomi­ for, 229, 229n; in India and nated director of Bank 01 England compared, 2340. Calcutta, 142; attends meet­ DHANIJOG HUNDI (G.): differ-' ings, 142-144. ence from Shdjog Hund', Cox & Co.: amalgamation of, 32n j form, 46-48. . 219. DHARWAR (DURWAR): capture CRISIS, CuRRENCY: (see also of, 101. Batta, Managed Currency, "DIPPBRENCBS": in exchange, Seasonal Stringency). in 63n. 1772, considered by Steuart, DIRECTORS 01 BANK PROPOSBD 48-49· BY STBUART: duties and res­ - in 1786-87, mitigated by ponsibilities, 55-56 j must GeneTai Bank, la-II; des­ not be high officials of gov­ cribed by Cornwallis, 175- ernment, 56. 176. - in 1790, due to ineptitude DIRBCTORS 0' BANK OF of H OIlOfld, 86-87; sequel, BBNGAI.: duties and respon­ 87"92. sibilities, 159"160, 160-161 j - in 1791, owing to fan of first directors elected and CoimbatOTe, 102; banks in nominated, 162. difficulties, 105-107. DIRECTORS 01, BANK 0' CAL­ - in 1806, due to financial CUTTA: election, 128, 138 ; f'mbarrassment of govern­ three to be nominated by ment, 124-127. government, 128-129, 137- CUPPAGB, MAJOR: reinforces J38 j to sign bank notes, garrison of CoimbatOTe, 102. 129 j first directors, 141-142 j CU'RRJlNCY, PAPER: see Paper first meeting, 142-143 ; Currency; also Bank Notes i second meeting, 143-145; to IDI!igenous Bank Instro­ consider loan applications, ments. J45-150. 262 ·EARLY EUROPEAN BANKING IN INDIA

DIREctoRS OF GENERAL BANK: - of Symes Scutt, 50, 90. election, 13-14; swearing in loon. to office, 14; meeting, 15 ; EsTAFETTItS : of indigenons qualiiication, 15-16; public bankers, 29n. officials must not be, 83; EUROPEAN BANK, E.uu.y: see prohibitory order withdrawn, Bank oj Bengal, Bank Of 85 ; chairman appointed a Calcutta, Bank of Hinaos­ member of Hanis Com­ tan, Bengal Bank, General mittee, 74. Bank Of Inaia. DISCOUNT RATE: reduction by EuROPEAN BANKING, E.uu.y: General Bank, 64, 82-3; by hostility towards indi­ Bank Of Hinaostan, 64-65, genous banking, 84; super­ 82 ; by Bank oj Calcutta, fluous in eighteenth century, 154; increase by Bank of 110; unable to take the place Bengal, 162. of indigenous banking, 166- DISCOUNTING: by GenM"ai 167, 170; counecting link Bank, 19, 67; by Bank of with indigenous banking, Calcutta, 153. 172-174; competition with indigenous banking, 174, DISHONESTY: among public contribution of, 175, 178-179. servants, 41-42, 86; in Euro­ pean banks, 66-67, 105; in ExCHANGE BANK: relation with indigenous banks, 66n. Imperial Bank not intimate, 186; increasing activity after DIVIDEND OF BA.'iK OF the War, 218-219; cash per­ .BENGAL: first haH-yearly, centage, 2190; suggestions 163. for reform, 219-222; expenses DIVIDEND OF GENERAL BANK: to-day compared with ex­ allocation, 16-17; first haH­ penses in eighteenth cen­ yearly, 69; causes of fluc­ tury, 222-224· tuation in, 73. DIVISION OF BANK SHARES: of ExCHANGE BusINESS: of Bengal General Bank, 12-13. Bank, 62-63; "covering" DURWAlt (DHARWAlt): capture 63n· of Pt'esiciency Banks, of, 101. . 186-'187; of Imperial Bank of DUSrooR (G.) : bank employee Inaia, 183, 186n. dismissed for taking, 66-67. ExCHANGE: 9,uotations, 63 ; lldifference, u· 6JD; "cover­ ing," 63n; table of rates for EcoNOMIC TmlORIES : sym­ .inland, 152, 168. metalism propounded by ExPENSES: of General Bank, Steuart, 53n; circulation of 69, 72; of Ban k of Calcutta,. bank notes believed to cause 128, 129, 130-131; should be batta, 75, 79; loan policy of cut down as much as possi­ banks believed to affect cur­ ble, 222-225. rency, 75; deposit banking and batta, 81-82; currency ExTERNAL CAPITAL COMMITTEE: confused with loanable suggestions for banking capital, 87, 108, 113-114; development, 197-198, 210n. inconvertible notes unsound in principle, go-g2; relation FAILURE or B.u.-xs: see Bank between private and public failures. securities, III. FAMINE: of 1770, 4, 76; of EDUCATION: urgent need for 1788, 76. spread of, 204, 207-208. FARMAN (G.): of Aurangzib ENDORSEMENT: form of, 149- to Diwan of Gujrat, 2370. 150. FAlI.RUX-SlYAR: awards title of ERROR: in official index, 119- /aga' Set" to Fate" Chana, 120. I. - of Cooke, 4, 5, 50, 6, 9D> FORMS, BANK: see Bank loon. Forms. INDEX 263

FOWLER COKMl1'Tl!l!: consider GolllASTAH (G.): his honesty $hrofJee business, 241!-249. praised, 66n. GoPAUL (KoPAL): captured by GINlR.U. BANK or INDIA: (see the British, 101. also Accomptant, Bank GoVERNMENT BANK: in Hun­ forms, Bank holidays, Bank ter's A nnals Of Rural business, Cashier, Cheque, Bengal, 94n; in official in­ Director, Discount rate, dex book, 1270; on indigen­ Discounting, Dividend, ous lines, 167-169. General l.\Ieeting, Gov­ GoVERNMENT CONNECTION WITH ernment connection with BANKS: (see also Bank pro­ Banks, Note of General posed by Steuart, General Bank 0/ India. Post Bill of Bank, Bengal Bank, Bank of General Bank 0/ India, Plan Calcutta, Bank 0/ Bengal, of General ) Imperial Bank 0/ India, Re­ establishment, 9; reason for gulation of banking by establishment, 110-11, liS; government, I,oans) remit­ opposition to establishment, tance through Bengal Bank 25-26; effect on Money post bills, 27-29, 35-36; ap­ Market, Ion; Plan, II-24 ; pointment of General Bank peculiar provisions, 9, 14, IS, as government banker, 24; reasons for such elabora­ 37-39, 40 ; remittance tion, 25 ; connection with through General Bank post Government, 37-39, 77-81 ; bills, 57-60; receipt of reduction in discount rate, private banks' notes into the 64, 82-83; special facilities, treasury prohibited, 77-'18 ; 65; efficient methods, 67-8; loan from General Bank re­ putting down corruption, 66- paid, 80; war loan raised 67; premises, 68; first half­ through banks 93"94; banker yearly report, 68-6g; press appointed a member of comment, 69-71 ; peculiar­ currency committee, 74 ; ities of bank report, 71; in­ responsibility for expenses comes and expenses, 69, 72; of Bank 0/ Calcutta guaran­ causes of fluctuating profits, teed, 128; notes to be re­ 73-74; receives subscription cognised by government. for famine relief, 76; repay­ 129; undertaking to return ment of loan granted to capital subscribed by share­ Government, 77-78, 79 ; holders of Bank 0/ Calcutta, severance of relations with 139; services of sentinels and Government, 79-80; balance law officers lent, 143 ; of account paid off, 80-81; government subscribe to parallel from European capital of Bank 0/ Calcutta, banking history 81-82; diffi­ 143; sanction for reduction culty in filling directorate, ~ discount rate, 153-154 ; 83-84; services rendered to Issue of bank notes from the community, 84-85; prohibit­ treasury, 155; sanction for torv order withdrawn, 85 ; payment of notes cat in disSolution, g8 ; postponed halves, 155-156 ; sanction g8-100; dividend on winding for payment of lost notes, up, IOD-IOI; unable to trans­ 156-157; legislation at in­ mit public revenues, 170 ; stance of Bank of Bengal, promotes public lectures, 157-158; superinten~ence 23ID• and control through direct­ GI!NERAL MIEnNG: (see also ors and chief officer appoint­ Bank reports) for General ed by government, 1:!8--129, Bank. 16-17; for Bank 0/ 137-138, 141-142 159, 162, England, 16n; for Bank 0/ 181; discounting of bills on Bengal. 162. mofussil treasuries, rS3 ; -­ GoLDSMITH'S NOTIS: history, annual report to be sub­ 2OD-2ln; form, 44:-45· mitted to government, 161; 264 'EARLY EUROPEAN BANKING IN INDIA

intimate relation of mutual HENNES, JAMBS: appointed benefit, 182; effect on Money agent by proprietors of 'Market, 182-183. Bengal Bank, 7. GoVERNMENT SECUlU1'IES: (see HINDOSTAN, BANK OF: See also Certificate, Treasury Bank of Hindostan. Bills, Paper Currency) dis­ HOI.IDAYS IN BANKS: See count in 1786, Io-II, lIn; Bank holidays. par in 1789, 84U; discount in HOLLO"""», JOHN: his conduct 17go, 87; discount in 1791, of Deccan War, 86-87. 106, 107; believed to rise in HORSI.EY, M. C.: Secretary to value as other securities de­ General Bank 01 India, 6g. preciate, III; importance of HOURS, BANKING: See Bank maintaining value of, II2- hours. II3, n6-II8, 179; effect of HUNDI (G.) : See also daTsani bank failures on value of, hundt, dhanijog hundi, II3-II6; bank notes intend­ khokd, kalkattiah, mejuT ed to rehabilitate, 49, 89, nama, muddati h"ndi, m""'" 124-127, 139 140, 140-141, JUT nama, pmt, paT patt, 177, 178-179; bank notes to shajog ""ndi. be freely convertible into, -main instrument for inland 151, 155; to be deposited for remittance&, 31, 246; emer­ recognition of bank notes, gency currency issued 37-38, 160, loon, 163; appre­ against, 92,204 ; legal position ciation as a result of esta­ unsatisfactory, 205; standar­ blishment of Bank Of Cal­ dised form necessary, 205- cutta, 154; expedients for: 206; effect on banking deve­ circulation in mofvsstl, lopment, 206-207; ninety per 179""-180 ; negotiability re­ cent. drawn to bearer, 206n; cognised, 180-181. importance of, 233; no regu­ GREAT FAMINJ!: see Famine, lar market in 18gB, 248-249; of 1770. position today, 249-250; GRINDLAY & Co.: amalgama­ rates, 251; business to be re­ tion of, 219. organised, 252. GuCCllITS (G.) : main resource HUNTI!R, SIR W. B. : an advo­ / of Bengali Mahajans, 240. cate of Land Mortgage Bonds, 202. HARlus CoMHITTU: object, HYDERAUD, NIZAM OF: parti­ 74; constitution, 74; pro­ cipates in Deccan War, 101. ceedings, 74-75; minute of dissent, 7S. IMPI!RI.o\l. BANK OF INDIA : amal­ HASTINGS, WARREN: scheme gamation of Presidency of paper currency, 49-52; Banks, 6, 40; regula- bank on indigenous lines, tion for loans and 167-16g; financial reforms advances, 20, 217U; govern­ unsuccessful, 175. • ment control, 38n ; emer­ HAT CHITA (G.): system tn gency currency against h",.,.. vogue among Bengali Mah4- diS, go, 204; not a Central jans, 241. Bank, 184; right of issuing HAy, EDWARD: Secretary of notes taken away, 127U, 184, Secret Department, 6, 86 ; 184U-18sn; debarred from partner of Bengal Bank, 6, doing exchange business, 29; directed to sever rela­ 186-187; relation with Indi.an tions with Bengal Bank, 61. joint stock banks, 187; WIth HENCHMAN, THO!IIAS: partner indigenous bankers, 187-188; of Bengal Bank, 29; dis­ unsatisfactory features, 188- missed from Government 191. service, 42-43. HIiRSCHBI.I. CoMMITJEII: mint INDEPENDENT TREASURY SYS­ closed to the public, 104 n. TEM: in force till 1921, 40• INDEX 265

JNDIAlf BANK, MADRAS: has conditions for investment, /' Tamil cheques, 22j'Jl. 193; development of deben­ INDIAlf JOINT STOCK BANKs: tures, 193-194; of Stock Ex­ relation with Imperial Bank changes, 194-195; of Invest­ not very intimate, 186; un­ ment Trusts, 194-195; caveat necessary expenses to be emptor policy, 196-197, 2II- avoided, 222-224 ; difference 212; question of Industrial from Exchange Banks, 224- Banks, 197-199. 225; should not ape Imperial lNDoRSEMlNT IN fAVOUR OF A Bank, 225 ; new outlook CORPORATION: how done, needed, 226; special features 149-150. to be introduced, 226-227; an INLAND TRADE: magnitude of, object lesson, 228-230; much 233; fUlancing, 65, 151, 233, depends on branch manager, 239-252. 23~231. INSTRUMENTS, BA"IK: see Bank INDIGENOUS BANK INsTRU- forms, Indigenous Bank MINTS: (see also danan' Instruments. '"mdt, dhanijog h .. ndi, IuU INTEREST, LEGAL RATE: regula­ chltd, Jokhm. hundt, kalkat­ tion of 1780, 19D, I29D; tlall, kMta pett, khoka, rendered nugatory in Eng­ ",e/uf' nama, m .. ddati hundi, land, loBn. ",unjuf' nama, pait, paf'-Pait, INTRODUCTION FOR OPENING pUf'ja) ; present unsatisfac­ Rum: ACCOUNT: unnecessary tory position, 205; need for in eighteenth century, 7. standardisation, 205-206 ; INvEsTMl!NT TRUSTS: as aid­ effect on banking develop­ ing banking development, ment, 206-207. 195-196. t NDIGENOUS BANKING: (see also banyan. bunneah, maha/an, /JA?AT ~E'tH ~G): house of, I! podaaf', shroff, sO'1IIcar, indi­ . Its nse, 2, Its fall, 3. 165. genous bank instruments) generosity of. B4n; com­ well developed in pre-British pany's banker till 1782, 166, times, I, IIO, lIon; honesty 166n. of employees, 66n; hostility JODHPUR: original home of of early European bankers House of ]agat Set", I. against, 84; gradual decline, JOKHMI HUNDI (G.): combi­ 165-166,I6g ; under Govern­ nation of bill of exchange ment patronage, 167-16g ; with insurance policy, 205. competition with early Euro­ pean banking, 174; present relation with Imperial Bank, KALKATTIAH (G.l: explained, 187-188; critics of, 232; com­ 243 ; rates of different classes, plexity and vastness of the 25 1 • system, 232-234; carried on KHALSA (G.): removal to along with trading, 236, 241- Calcutta, 4 ; actual and 243 ; historical reason for estinlated receipts into. 176. this, 237-239; as carried on KHAn Pm (G.): new, 241- in the mo/ussil. 253-254 ; 242; old. 243. reforms necessary, 255. KBAzANCHEE (G.) : of Bank of (NDUSTltIAt BANKS: (see also" Calcutta to be sworn in to Industrial Finance) contrast­ office, 129; his salary, 130 ; ed with Commercial Banks, of Bank 01 Bengal, 162. 191 ; suggestions, 197-198; KHoKA (G.): original bill of justification for Government exchange, 33; form for mud­ help, 198 ; practical diffi­ dati hundi, 31-32; form for culties, 199. daf'sani hundi, 47-48. ltmUSTRIAt FINANCE: need can­ KING H.um.TON & Co.: amal- not be met by Commercial gamation of. 219. , Banks, 191; present system KopAI. (GoPAm.); captured bi IInsatisfactory. 193n ; two the British, 101. 266 EARLY EUROPEAN lJANKING IN INDIA

LADBROKE & Co. v. TODD: Seasonal Stringency in dangers of opening bank Money Market) evils of~ accounts without introduc­ 184-185. tion, 7, 7n-8n. MANSFIIII.D COMMISSION: LAISSEZ FAIRE IN BANKING: object, 247; constitution. inimical to banking develop­ 247n; considers views of ment, 210-212; inapplicable shro!fs on currency position. in absence of trained 247-248. bankers, 212-213. MARHATTA INvASION: amount·J LAND BANK, STATE: justified carried off from house of on principle, 203; practical Jagat Seth, 2, 2n. difficulties, 203-204. MaDOWS, GIINERAI.: holds a LAND MORTGAGE BONDS: deve­ conference for raising War lopment of, 202, 254. Loan, 93· LECTURES, PUBI.IC: promoted MElt, BENJAMIN: partner of by banks, 23In. Bengal Bank, 29, 30; .~es­ LETTER of LIEN: form ,147. cribes embarrassed POSItion LIEN: Banker's and ordinary, of Bengal Bank to Govern­ 146n. ment, 119. /' LIMIrED LIABILITY BANK, MEETING. BANK: See General /' EARI.IEST: See General Bank Meeting, Bank Reports. of India. MEJUR NAMA (G.): el!'plained~ LIMITED LIABILITY, PRINCIPI.E 33· / OF: in England, 9"10; in "MaRCHANT PRINCES": used India, IS, 22-23, 25, 85· to desiguate Agency Houses. LoANS AND ADVANCES: Regu­ 3· lation of, 20, 216-217. MINT: closing of, 185. LoANS BY Bank of Calcutta: MIll HARm: plunders house of margin, 130; penalty for u~­ Jagat Setk, 2. authorised loans, 130; maxI­ MIR JAFAR: succeeds Siraj-ud­ mum period, 138; procedure Dowla, 2. for, 145, 150-151; prescribed MIR KAsm: succeeds Mir form, 146; against char chit­ Jafar, 3· ties, 148-149; against govern­ MONEY MARKET OF Cu.cuTTA: ment securities, 153-154. See Crises, Currency; Ex­ Lo.~S BY General Bank: pro­ change Banks, Government cedure for, 20; against Securities, Imperial Bank of mofussil consignments, 6~; India, Indian Joint Stock to government, 37-38 ; paId Banks, In~genous Banks. off, 77-78, 79· Seasonal Strmgency. LoANS BY Imperial Bank of MONGHYR : Jagat Seth thrown India: 20, 217U. from the bastion of, 3· LoCKE, JOHN: his erroneous MONSOON: its irregular char­ doctrine, II4· acter, 239"240. LoTTERY: promoted by Bengal MOORSHEDABAD: invaded by Bank 61 . by Bank of MaTlaattas, 2; KMlsil re­ Hind~stan: 122-123; in aid of moved from, 4· public works, 123; by Bank MORTGAGII BONDS, LAND: deve­ of Calcutta, 143-144; by Bank lopment of, 202, 254· Of Bengal, 144-145. MUDDATl HUNnI (G.): (See also dkanijog hundi, kkoka, MAHAJAN: Bengali, 240, 242n; mejur nama, munj"r nama, different from bunneah, 252- pait, par pait. ~hahjog 253; unsparing critics, 232 ; kundi) used for remlttance~ defects, 253-254; reforms, 31; form, 32. MmTIPU-RBSERVE SYSTEM: 255· . d MAIR ARTHUR: appomte does not obtain in India. dir~ctor of General Bank of 183, 222. India, 85. MUNJUR NAMA (G.): ex- MANAGED CURRENCY: (see also plained, 33. INDEX 267

MURSBID QULI : appoints P. P.: stands for Public Pro­ Mansk Chand his banker, I.' ceedings, 27D. MYSORB WAR: See War, P. & O. BANKING CORPORA­ Deccan. TION : amalgamation with , 219. NATIONAl, BANKS OF U. S .A. : PAIT (G.): difference from established to rehabilitate second of exchange, 33 ; U. S. Bonds, 140-141. form, 33-34 ; peculiarities, NIZAM OF HYDERABAD: parti­ 35· cipates in Deccan War, 101. PAI,MER & Co.: establish Cal­ NOTES, GoVERNMENT: See cutta Bank, 5n. Paper Currency. PANIC MONGERS: action NOTES OF Bank of Bengal: against, 20<)-210. circulation in 1820, 145; theft PAPER CuRRENCY: See also not an offence, 158; power Bank Notes, . Indigenous of issue taken away, 127n, Bank Instruments. IB4, 18~-185n. Steuart's Scheme, 52-53, 55; NOTES OF Bank of Calcutta: Warren Hastings's attempt, intended to effect reform in 49"52; prescribed form, 51 j finance and currency, 124- proposal by Chiefs of 127, 127n, 139"140, 154-156, Agency Houses, 87-90 j in­ 175, 177, 178-179; to be convertible notes condemned signed by directors, 129, 143; by Steuart, 90 ; minute of to be recognised by Govern­ Cornwallis, 91-92; vested in ment, 129, 138; denomi­ the government since 1862, nation, 138, 143, 152; to be 127D, 184, 18~-I86n; ade­ issued against Treasury quate control necessary, 214. Bills, 138, 142-143; converti­ PAR PAIT (G.): compared bility, 143, 152-153; circula­ with third of bill of ex­ tion in the mofussil, 155-156; change, 33, 35· safeguards for payment of PEW, COLONEL: maladminis­ lost notes, 156-157 j issue tration of first Benares Bank, from the treasury, 155. 217D. NOTES OF Bank Of England: PLAN OF BANK PROPOSED BY form, 46. STBUART: shares to be sub­ NoTES OF Bank of Hindostan : scribed by Government offi­ circulation, 177D. cials, 53-54; business to be NOTBS OF Bengal Bank: to be undertaken, 54-55; notes to signed by a partner, 8 j form, be recognised by Govern­ 43; circulation in 1791, 106, ment, 55 j meetings and 177D· . directors, 55; branches, 56; NOTI!s OF General Bank: de­ high officials not to be direc­ nomination and reserves, 17, tors, 56; business to be 18 j accepted in payment of avoided, 56-57. Government dues, 38; form, PLAN OF BANK OF BENGAl,: 44; watermark, 61; believed legal difficulties removed by to cause batta, 75, 79 j Cha.rter of 1809, 15; follows Government recognition provisions for 'permanent' withdrawn, So. Bank of Calcutta, 158; right NOTES OF GoLDSMITHS: his­ of voting, 159 j directors as tory, 20n-2ID j form, 44-45. superintendents, 159; maxi­ mum holding of government O. C.: stands for Original securities, 160 ; personal Consultstion, 27D. liability of directors, 160 ; ONE-RESERVE SYSTBY : does not and of treasurer, 160; bank obtain in India, 183-184. strictly prohibited from ORIENTAl, BANK CORPORA nON : trading, 161; annual bank history, 149D; method of in­ report, 16T. dorsing, 149"150. PI.AK OF BANK OF C.u.cuTTA: OVERDRAFT: See Loan •• provisions f(1l' permanent 268 EARLY EUROPEAN BANKING IN INDIA

bank: period, x28; official PRE PORCHER, JOSIAS Du: control, x28 ; government partner of Bank Of Hindos­ guarantee, X28; qualification tan, 93. of directors, x28 ; election, PROFITS: of General Bank, x28; official directors, x28- 16-17, 69, 72, 73; of Bank of X29; expenses, X29; directors Calcutta, 131-133, of Bank Of to sign notes, X29; swearing Bengal, 163; of Imperial in to office, X29; half-yearly Bank Of Inaia, ISg; of closing, X29; notes to be Central Banks in foreign legal tender for government countries, ISgn-lgon. dues, X29; maximum lend­ PuRJAS (G.): two meanings ing, X29; margin for ad­ explained, 244 ; form, 244- vances, x30 ; penalty for 245; rate, 251. overdrawing, x30; cash per­ PuRKYBRS (G.): of Bank of centage, X30; estimated ex­ Calcutta, X31. penses, X30-131 ; estimated profits, X31-133; provisions for temporary bank, x37-x39. REDHEAD, THoMAS: partner of Bank Of Hindostan, 93: PLAN OF GENERAl. BANK OF REGISTRAR: of Co-operative INDIA: capital and shares, Societies and of· Joint Stock U-12; subscription, half in Companies, 2U-2X2. cash and half in paper, 13 i REGULATION OF BANKING BY directors, cashier, secretary, GoVERNMENT: control over accountant to be sworn in General Bank, 38; over to office, 14; directors, 13- Imperial Bank of Inaia, 20, 15; limited liability, 15, 22; 38n; over Bank of Calcutta, qualification of directors, 128-g, 153-154, 155-157 i at 15-16; five years' term, 16; present ineffective, 210-213 ; quarterly and half-yearly ·over note-issue, 2X3-214; over meetings, 16-x7 i notes and deposit banking, 2X4-2x6 ; reserves, 17-18; holidays and over loans and advances, hours of business, x8 i dis­ 216-zx7; over Exchange counting, 19; current ac­ Banks, 219-220. counts etc., 19"20; loans ~d overdrafts, 20-2X; balancmg REMITTANCE BUSINESS: by of cash, 21 ; alteration of General Bank, 57-60 ; by agreement, 2X ; transfer of Bengal Bank, 27-29. 35-36; shares, 2X, 23-4; notice to by indigenous bankers, 31 public, 22-23 i cashier and et seq., x66, x67, x68, 16g; by secretary to hold shares, 24. Bank Of Calcutta, 15x-x52, X53· PODDARS (G.): appear before REsERVES OF GENERAl. BANK: Hams Committee, 74-75; of regulation, 17. Bank of Calcutta, x31; not RIDER, JACOB: Deputy Import the same as '5hroffs, 74-75, Warehouse Keeper, 6; part­ 246. ner of Bengal Bank, 6 i dis­ POST BILLS: origin in Eng­ missed from Government land, 31 ; peculiarities in service, 42 i adjusts accounts India, 3x; days of grace, of Bengal Bank, X21-X22, 213. 5gu· Ross, H. M.: his description POST BILLS-OF Bengal Bank: of shroffee business, 249. plan for remitting funds to RUPEE: see Arcot Rupee, Cur­ Bombay, 27-29; form, 30; rent Rupee, Sicca Rupee. unacceptable to shroffs of RURAl. INDEBTEDNESS: a stu­ Bombay and Surat, 35-36. pendous problem, .200-201, POST BILLS OF General Bank: 232, 253-254 ; remedies, 201- regulation, 22; plan for re­ 202, 255. mitting funds to mofussil, 57-60 ; days of grace, 59n; SBASONAL STRINGENCY 1N watermark, 61. MoNEY M.uuaT: in Novem- INDEX 269

ber/December d uri n g STAMP DUTY: on cheques, 208- eighteenth century, 97, 97n j 209· in nineteenth century des­ STATa BANK: considered by cribed by Van Den Berg, Steuart, 52-53; benefits, 1Sg- 184n-185n j present-day reme­ 191; State Industrial Bank, dial measures, 92, 92n, 204- 198 ; practical difficulties, 207. 199; State Land Bank, 203; SIlCRIITARY or GaNBRAL BANK: practical difficulties, 203. to be sworn in to office, STOCK ExCBANGBS: develop­ 14 j to hold shares, 24. ment of, 194-195, 202. SaCRllTARY AND TluIASURJ!R or SroNa, HBNRY : nominated BANK or BaNGAL: first in­ director of Bank of Bengal, cumbent, 162; sworn in to 163. office, 162 j personally liable SWSARING IN TO QFrlca: of for unauthorised loans, 160. Genera! Bank employees, 14; SIlCRllTARY AND TRJ!AsURaR or of Bank of Calcutta em­ BANK or CAI.CUHA: to be ployees, 129; of Bank of sworn in to office, 129 j Bengal employees, 162. salary, 130; first incunIbent, SYMMJ!TALLISM: proposed by 123· Steuart in 1772, 53n. SETH (G.) : title of, awarded to Manik Chand, I. TAU INDUSTRIAL BANK: ex­ SETH, JAGAT (G.): see ]agat change business of, 220; Seth. bloated charges. 223n ; dis­ SHAJOG HUNDI (G.): differ­ counting of purjas, 2448. ence from dhanijog hundi, TaIGNMOUTH, LORD (Sir John 32n j form, 32. Shore): describes famine of SHERJ!R, J. W. : member of In­ 1788, 76. dian Civil Service, 123; first TrPPOO: subscription in aid of Secretary and Treasurer of troops fighting, 6; campaign Bank 01 Calcutta, 123. against, 85-86, 86n, 101-102. SHORa, SIR JOHN: (afterwards TOWN HALL or CALCUTTA: Lord Teignmouth) describes first built with proceeds of famine of 1788, 76. Lottery, 122-123, 143-144. SHRorrs (G.) : of Bombay and Surat refuse to discount TRADING-CUM-BA."iIXING : by Bengal Bank Post Bills, 36; present-day European firms, maligned by early European 234-235, 235n; historical rea­ bankers, B4; of Calcutta ap­ sons, 236, 237-239; evils, 236- pear before Hams Commit­ 237; by present-day Indian tee. 75; of Bank 01 Calcutta, firms, 239-241, 241-243, 252- 253· salary of, 131; evolved out TRAVANCORa, RAJAH ally of Banyans. 172-174; position or: in 1830, 245-246; in 1866, of the British in Deccan 247-249; in 1893, 249; at the War, 85, 86. present time, 232-233, 240, fiaASURY BILLS: issued for 249-250; not the same as financing Deccan War, 95- I'oddars, 246; rates, 249, 98; declared legal tender for 250, 251; reforms necessary, govemmp.nt dues, 96 ; re­ 282. habilitation through Bank of SICCA RUPJ!a (G.): explained, Calcutta, 125-126, 140, 156; un. to be freely exchanged for SIRAJ-UD-DOWLA : overthrown notes, 151; Bank of Calcutta at instance of ]agat Seth. 2. notes to be issued against, SLEIGH. J. H. : his description 138, 151; issue discontinued of shroffee business, 249. from the treasury, 155; SOWCAR (G.) : mayor may not TuCKER. HaNRY ST. GEORGa: be a banker, 188n. founder of Bank of Ca1J;utta, SPJ!CULAnoN: s a f e g u a r d 9 142; nominated director, against improper, 195. 142; attends meetings, 142- 270 ,EARLY EUROPEAN BANKING IN INDIA

143; nominated director of treasury bills issued, 95-98 ; Bank of Bengal, 162. Cornwallis assumes com­ WAR, DECCAN: described in mand, 101; Bangalore and Calcutta Gazette, 86n; subs­ other forts captured, 101 ; cription opened in aid of fall of Coimbatore, 102 ; troops, 6; military arrears news causes financial panic paid off, 9; desultory cam­ in Calcutta, 102. " paign in, 1789-90, 85-86 ; WATER MARK: on bank instru­ effect on Calcutta Money ments, 61. Market, 86-87; conference at WHITEWELL, E.: paxtner of Government House, 93; loan Bengal Bank, 29. raised with the help of "WRITERS" OF BANK OF CAL­ banks, 93"94 ; mofussil dis­ CUTTA: salaries of different bursements stopped, 94-95; classes, 130-131.

GLOSSARY.

ARATDAR: a dealer, who gets European gentleman doing a certain commission on the analogous duties. price of goods temporarily BATTA: (from Hindi Batta) stored in his arat or godown agio; difference in exchange by a whole-saler. or discount on coins not ARCOT RUPEE: the rupee current. originally coined by the BATTAH : (also BHATTA) a Nawab of Arcot in the special allowance granted to Madras Presidency and military officers under the afterwards by the English, East India Company. French and Dutch East BEPARI: an Indian wholesale­ India Companies. The dealer. weight varied from 171 to BHATTA : modem form of 177 grains and the quantity BATTAH, q. v. of pure silver from 160 to BUDLEE: a sintultaneous pur­ 170 grains. chase and sale of foreign ex­ ASWIN: name of a month ac­ change, etc cording to Indian calendar. BUNNEAH: see BANIA. AURANG (also AURUNG): a CHURAWALI,AH (also CaURU-, place where goods are manu­ WALI,AH): a class of up-' factured; a depOt for such country dealers in Calcutta, goods. whose main business is the BADI: the dark fortnight, that financing of consignments to of the moon's wane from the United Provinces. full to the new moon. COMPRADOR: (from Portuguese BANIA: (from Sanskrit Vanij. Comprador, purchaser) a merchant) a merchant­ responsible person who banker. who generally trades engages servants and acts with his own capital. as the pay-master of foreign BANTO: a class of persons in merchants in China; the JAPAN, who resemble the guarantee-broker and cashier banyans of ,India or the com­ of banks in Chjna. pradars of China. CooTEE : a branch or an BANYAN: (from ~anskrit agency. Vanij) present meanmg, an Indian broker attached to DHANIJoG HUNDI: an. inl~d houses of business; for­ bill of exchange wrttten tn merly, a person in. the vernacular payable to the employment of a private purchaser or his representa- GLOSSARY 271

tive. (See also SHAHIOG KHATA PEn (new): a clean HUNnI). overdraft in the books of an DIWAN: the chief financial Indian indigenous banker. minister of the State or of IUUTA PETI (old): a compul­ a province vested with la~ge sory deposit system in which judicial powers (dunng deposits have to be accepted Muhammadan rule). during the slack season at DURSANI (DUII.SUNNI): an on a stipulated rate in return demand inland bill of ex­ for accommodation received change. during the busy season. KHUANCHEE : chief Indian DUSTOOR (DuSTOOII.Y): (from cashier, frequently a, guaran­ Hindi DastoOf', custom) the tor of all loans granted, and commission on a cash trans­ of all bills discounted, by a action charged by an agent bank. of payment, with or without KHOKA: the original hundi or the knowledge or consent of inland bill of exchange his principal; a customary written in vernacular. fee or perquisite. MAHAJAN : (from Sanskrit FARMAN (FIRMm, FIRMAUN): Mahd-jun, a great person) (from Persian Farman) an an Indian merchant-banker order, patent or passport of standing, who generally issued by the sovereign. deals with other peoples' GoMASTAH : (from Persian money as well as his own. Gum4stah, appointed, dele­ MEJUII. NAMA: the fourth gated) an Indian agent or "copv" of a bill of ex­ factor. change issued when the GUCCHIT: a deposit, generally original, second "copy" and for safe custody. third "copy" have been issued, one after another, and all lost. HAT CHrTA: a ledger account MOFUSSIL: the country stations opened by Bengali or other and districts as opposed to Indian Mahajans in the the Presidency. name of their borrowers. MUAZZAF: fixed revenue. HOONDI!I, HOONDY, HUNnI: MUDDATI HUNnI: a usance in­ an inland bill of exchange land bill of exchange written written in vernacular. in vernacular. JAGAT SETH: literally, 'banker MUNJUR NAMA : same as of the world'; a title of MEJUR NAMA, q. v. great honour for an Indian ,MUQUASEMA: share of crops. banker. MUTSADDI (also MUS.lDDI): another name for BANYAN, JOKHMI HUNnI: a bill of ex­ q. v. change and an insurance policy rolled into one; "A PAIT: the second "copy" of a jokhmi hundi is in the bill of exchange in verna­ nature of a policy of insur­ cular, issued when' the ori­ ance with this difference ginal has been lost. . that the money is paid PALANQUEEN: a box-litter used beforehand, to be recovered for travelling in, with a pole if the ship is not lost"­ projecting before and be­ Bayley, J. in Raisey Amer­ hind which is bome on the chand v. jusraj Vinpal, shoulders of 4 or 6 men. Born., 25th july, 1871. PARIAH: name of a low caste in South India, hence an KALKATrIAH: a bill of ex­ untouchable. change written in vernacu­ PAR-PAIT: the third "copy" lar drawn and payable in of a bill of exchange' in Calcutta. vernacular, when the ori­ KHAI.SA: treasury. ginal and the second "copy" 272 EARLY EUROPEAN BANKING IN INDIA

have both been lost. [The an Indian merchant-banker meaning given in Wilson's of standing. Glossary is incorrect as ex­ SHA: (from Hindi Sah) an plained in the book.] Indian merchant-banker of PODDAR: a money-changer or standing. a teller; an employee of a SHAJOG HUNDI: an inland bank whose duty was to bill of exchange written in weigh money and bullion vernacular, generally pay­ and appraise the value of able through a Sha or a res­ coins. pectable merchant-banker. PUR]A (in European banks) : SHROFIt (from Arabic Sarra!) an on demand joint and an Indian banker, of the several promissory note highest grade dealing in along with a letter from the bills; sometimes loosely used makers (generally two in for the chief cashier or his. number) undertaking to pay assistants or even podddrs off the note on a stipulated q.v. date. SICCA RUPEE: . (f!"om Arabic Sikkd, a commg die) a­ PuRJA (among Indian indi­ newly coined rupee. genous bankers): an un­ stamped request to pay ad­ SOWCAR : (from Hindi Sahu­ dressed to an' Indian indi­ karl an Indian merchant­ genous banker carrying a banker of some standing. stipulated interest, some­ [Wilson mentions a facetious times "discounted" among etymology in Marathi, viz., ,indigenous bankers. SdlJakar, from sa, six and 'IIakar, the letter'll, i.e., "the RVOT: (from Arabic Ra'iyat, six words beginning with 'II~ from Ra'a, to pasture) a which characterise the opu­ . tenant of the soil. lent banker,-'IIastra, dress. SAwlAT : year of Hindu 'IIapv, portly person, 'IIidya. 'calendar, dating from King knowledge, 'IIinaya, decorous Vikramaditya. behaviour, 'IIani. fluency of SETH: (from Sanskrit Sresthi) speech and vitta, wealth. "J

REFERENCES.

[Names of articles, speeches, books, reports and periodicals are printed in it!llics.]

Agriculturists' Loans Act BENGAl. SECRETARIAT Rl!CORDS. (Act XII of 1884), 203. 149· Asiatic II nnUIJI Register, 154, BERG, N. P., VAN DEN, Money ISS, 158, 162. Market and Paper Cvrrency AUBER, PIlTER, Rise and Pro­ 01 British India (1884), r!4. gress 01 the British Power BI.ACKl!'tT, HON'BU SIR BASII., in India (r826), 176. Central Bank Speech (r924)~ Babington Smith Cvrrency 193; Delhi University SPeech­ Committee Report (1920). (1925), 180, 206, 209, 234. BRUNYAft. J. B.o- Account Of , 233· . ths Presidency Banks (1900) .. BAGEHOT, WAl.ftR. 231. Bankers' Magazine, London, 144. 187. ' 92, 204, 235· Calcutta Exchange Prices BENGAl. CHAMBI!R OF CoMMJ!RCll Current, 149. LmRARV AND Rl!CORDS, 184. Calcutta Gazette, 6, 7, 8, 9, 10, 215· 14, 18, 26, 44, 61, 62, 64, 65 .. REFERENCES 273

67, 68, 71, 76. 84. 86, 93. 95. Hersche" Committee Report 100. 122, 146. 153. 163, 172, (1892). 104. . ISo. 230. 246. HUNTER, Sm WILLIAM, Annals Calcutta Review, 172. 221. Of ,~uralBengal(I8g7), (7th CALVERT. H., Prevailing Types edition) 94. 95, Il3. Of Rural Credit Societies, 254· Act (Act XI, of 1920) 20 38 Capital, 204. 228. 186. vn ' , , CICIL. GIORGII. India's Ama­ teur Bankers, 235. . IMPERIAL BANK OF INDIA Census Report (19U), 233. LIBRARY AND RlICORDS, 5. 9,' Chamberlain Commission Re­ I IOO, 123, 127. 137. 42. I43. port (1913). 201. MPIRIAL RECORDS, IO., 27, 36, Company Law Amendment 37, 39, 41• 42, 57. 58, 59. 60, Committee Report (appoint­ 74. 77. 78, 79. 80. 83. 87. 91. ed by the British Board of 94, IOl. 103, 105, 107, log, Trade, Cmd. 2657). 195. 1«)6. II9. 120. 136. 137. I41. 42. Coon, CHARLBS NORTHCOTII, I43. I48. I49, I53, 156. 157, Rise, Progress and Present 158. 162, 163. Condition Of Banking in INDIA OFFICI! REcoJWs. II9. Indta (1863). 4. 5. 9. 29. 43. Indian Companies Act (Act 66. 100. 121. 143. 162, 163. Vp: of 1913). 21b 177. 217. 237. 246• 249· IndJan 'Co-operative 'Studies Co-operative Societies Act, 254. " (Act n Of'1912) 201. 2II. Indian Journal Of Economics CUTTency Commission Report, 221. ' ,sc;e Mansfield Commission Indian Paper CUTTency Report, (1866); Chamberlain (Amendment) Act • (Act Commission Report (1913). X!--V of 1920). 92. , • CIATTency Committee Report, IndJan Securities Act (Act.·X see HaTTis Committee Re­ of 1920). ISo. port (1787); Herschen Com­ Industrial Conference, Sixt,,· mittee Report, (18g2); Fowler U. P., 217. Committee Report (18gB) INSTI'WTE OF BANKllRS (LoN­ Babington Smith Committee DON) LIBRARY AND RlIcoRDS Report (1920). 45· ' CuRZON, LoRD, 256. JOIlHI, G. N. AND P. A. DONNEL, SIR A. P. 'MAC, 252. WADIA, Money and Money DUNBAR. CHARLBS P., Theory Market in India (1926). 194, , and History of Banking, 197, 216. (2nd edition). 82. Economic Journal (Journal 01 KEYNES, JOHN MAYNARD, 'In­ the Royal Economic Society, dian CUTTency and Finance 1 London). 25. (19 3), 197. O;!20. 235. Ezternal Capital Comlttee Re- Land Improvement Loans Act, . f'ort (1925). 19B. 210. , (Act XIX of 1883). 2°3., '" Financial News, London, 190. LAW, RAJA RIsmll CAsE, Fowler Committee. Report Memorandum to External (J8gB). 248. 252. ' Capital Committee, 210. GIORGI, LLOYD, 233. LIIAGUI! OF NATIONS, Memo­ GILBuT's History, • Principles randum on Central Banks, and Practice 01 Banking, 1913 and 1918-1923 (Geneva. Edited by E. Sykes (19II), 1924), I89, 190. 21, 31. LoCK1l, JOHN, 114. HAMILTON, Sm DANIBL, 101, LoNG, RlIv. J .• Selections Irom 208.' the Unpublished Records of HAND, J. RlIGINALD, Early Government, ' 1748-1767 English Administration in (l86g). Vo1. I, I. 'Bihar (1894). 166. 16g. MAGIll, DR. J. D., Materials Hams Committee. Report for the Study Of Banking (1787) •.74· (1923). 227· ' B.B. 18 UARTIN, MONTGOMERV, East­ Mar.ket and' '11.8, 'Remedy, ern bldill (183iJ, 246. (The 'P' 204; Foreign . E'"'_~ge . real author was Buchanan III Indian BankS, Z2I; Fo,. Hamilton). . ward Exchange in 'Illdian MAcLEOD, H. D., Theory /Jnd .Banks, 221; 225. . .('radice of, Banking, . 2 in SINHA, J. C., Economic Theo­ vols. (1883), 44. ' rists among Serv/Jnts' of Negotiable Instruments Act John Company. 25;' SomlJ. (Act XXVI of 1881), 205. Currency Reforms 01 Hast­ PRICE, J. . C., History 0/ ings, '49, Economic Annals Midnapore (1876), Vol. I .• Of Bengal, 125, 16g. . . 167. . SI,ATER •• DR. GII.BEIlT, Memo­ Rango.n Times, 229. randum to External, Capital RAu, B. RAIIt CHANDRA, Pre~' Committel/, 19B. sent-d4y Banking in Indill, SMITH, . ADAM,Wealth cf (2Dd. edition), 216, 226. Nations, 25. REED; SIR STANLEY; 229. SMITH, T., 217. Report of the Select Commit­ Statist, 234. tee of the House .of Com.- , Statistical Tables Relating '0 mons (1832), 173-174. Banks in India. 219, 234- RosS, CHAIu.ES, Correspo"," dsncll 'Of Charles, First STEUART, SIR JAMES. Prin­ Marqids COMwallis (in 3 ciples of Money Applied to. vols.) (1~59); Vol. I, 87; the Present state of ths Vol. II, '102. Coin 01 Bengal, 49, 51, 52, SARKAR, J. N., Mughal Ad­ 53. 54, go. 177, 196. . mi.ni.stration. (2nd edition), StEWART, CHARI.ES, History Of 237· Bengal (1813), II. ' Se,;r Mutaqherin (Cambray's SYMES SCUTT, G. P., History Edition) Vol. II, 2. of the Bank bf Bengal. SETON-KARR, W. S., Selection (1904). 5, 9. 100, 123. 127. from the Calcutta Gazette 137. 142, 143· (1784 to 1788),' 123· TEIGNMOUTH, LoRD, Memoir SHEI.DON, H. P., Elementary of the foife and Correspon­ Banking (1923), 21. ence of John Lord Teign­ SHIRRAS, G. FINDJ,AY, Indian mouth (1843), 76. Finance and Banking (1924) TOOKE. History of Prices, 108. 250 • '. WADIA. P. A. AND G. N. JOSHI, SINHA. H., Se/Jsonal strin­ see JOSHI, G. N. AND P. A. gency in the Indian Money WADU'