Hundi: India's traditional traveller's cheque
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Revision as of 15:49, 11 January 2014
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Hundi: India's traditional traveller's cheque
Gujarat businessmen invented traveller’s cheques
Ashleshaa Khurana,TNN | Jan 11, 2014
AHMEDABAD: Lured by trading opportunities, enterprising Gujarati businessmen have travelled the world since centuries. It is no surprise that driven by the need to ensure a safe money-transfer system, these merchants invented the hundi — adapted in modern times as traveller's cheques.
In his book 'Eighteenth Century Gujarat: The Dynamics Of Its Political Economy', Ghulam A Nadri writes, "At Surat, merchants issued hundi on their correspondents in other cities. The issuer received the accounts plus a commission."
Historian Achyut Yagnik points out that even before the British era, Gujaratis were sarraffs or sahukars — money changers or lenders. "Since Cambay was an important port, the merchants willingly accepted the network of hundi transactions for it was safe. From the Solanki to Chalukya dynasties, to the Mughal rule and British Raj, hundis were prevalent. Everyone from Ahmedabad's Shantidas Sheth to Emperor Shah Jahan issued hundis.
Their use was widespread within the country as Gujarat dealt with Kolkata, Kashi, Delhi, Madras and other regions," says Yagnik.
It was the Gujaratis who introduced the British to hundis. The latter morphed it into the traveller's cheque, with the first issued on January 1, 1772 by the London Credit Exchange Company.
Various types of hundis have Gujarati names; consider jokhami, shayog, and muddati, testament to their area of origin. In her thesis, 'An Economic History of Hundi — 1858-1978' for The London School of Economics, Marina Bernadette Victoria Martin states how hundis were a "centuries-old artery for Indian merchants' networks".
However, in Gujarat, the existence of the hundi lives on in the legend of Narsinh Mehta. The song Narsinh Mehta ni hundi describes how Krishna paid Mehta's debt via a hundi and proves the prevalence of the system in Gujarat.
