CHAPTER VI
BANKING, TRADE AND COMMERCE
|
(i) |
|
|
(a) |
|
|
(b) |
|
|
© |
|
|
(d) |
|
|
(ii) |
|
|
(a) |
|
|
(b) |
|
|
© |
|
|
(d) |
|
|
(e) |
Merchants’ and Consumers’ Associations and Organs for the Dissemination of Trade News |
|
(f) |
|
|
(g) |
(a) History of
Indigenous Banking
Banking in various forms has been practiced in India since time immemorial. In ancient literature, there are quite a number of references to the very efficient system of banking in India. This system financed trade and commerce in an age when the West had not even evolved the monetary system. This system continues working to the present day in spite of the opening of a large number of joint-stock banks on modern lines. Since very early times, the people have been accustomed to the use of credit instruments, e.g. hundis. Money lending has also been going on from time immemorial. The Amritsar District, more particularly the Amritsar city, has always enjoyed special significance. Soon after its foundation, Amritsar became famous not only as the holiest seat of the Sikh religion but also as a great entrepot os trade and commerce in the whole of the north-west region. Through the efforts of the Sikh Gurus and because of the patronage of the Lahore Durbar, the city became the biggest clearing-house for the vast variety of products from the remote Himalayan fastnesses of Yarkand, Samarkand, Leh, Lahul and Spiti and from centers as far away as Afghanistan and Persia. Amritsar reached its heyday in religious and political ascendancy during the days of the valiant Sikh ruler, Maharaja Ranjit Singh. It continues to be a leading center in trade and commerce and also maintains its supremacy in textiles. In the field of religion, too, Amritsar occupies a unique position, because the holiest Sikh religious seats, viz. the Akal Takht and the Golden Temple, which draw a perennial stream of its votaries and admirers from far and near, are located here. These religious seats are the most important historical factors which have promoted finance, trade and commerce and also money-lending in the district.
During
the early period, money-lending was very simple, because it was the sahukar(
indigenous money-lender) who was almost the sole source of finance. His clients
were persons who were intimately acquainted with him. Money-lending involved
very little of writing and functioned smoothly because of the personal contacts
between the lenders and the borrowers. It is well known that in the early years
of his kingship, Maharaja Ranjit Singh (as the head of the Sukarchakia Misl)
had carried on his major financial transactions with Rama Nand1, a
famous banker of Amritsar, because he could not set up a State treasury or
appoint a treasurer of his own. The arrangement was discontinued when he
organized his Accounts Office at Lahore in 1811 or thereabout. Till them, the
traditional type of banking facilities were provided by the local financiers2
to the promising prince, who soon
became the ruler of the whole of the Punjab. In the beginning, the
money-lenders fulfilled the emergent needs of the borrowers and were respected
for their wealth as well as for their position, but gradually some defects
crept into the system. The instinct of greed turned the money-lenders into
Shylocks. The practice of usury came into vogue and exorbitant rates of
interest came to be charged. The money lenders also resorted to the malpractice
of fictitious entries. Apart from higher rates of interest, the borrower was
under personal obligation to the money lender till he was able to clear his
debt. There were numerous instances where the interest multiplied many times
the principal, and the borrower, being unable to pay the debt, had to part with
his belongings, including land. Before the advent of the British, this problem
of rural indebtedness was not very acute. The cases were handled by the village
panchayats. The panchayats watched the interests of both the borrower and the
money-lender, and never allowed the money-lender to resort to extreme measures
like the attachment of land and property. They also prevailed upon the
money-lender to be considerate towards the borrower. Being a shopkeeper as well
as a money lender, the sahukar generally preferred to get the produce, on
which, without much effort, he could reap a double profit, one from the
producer to whom he lent the money and the other from the consumer to whom he
sold the produce. This continued to be
the case during the first twenty years of the British rule. After 1870, circumstances changed. Land became a first
rate investment which was always rising in value. As soon as he realized this
thing, the money lender began to use it as an outlet for his rapidly
accumulating capital, and, finding the investment more and more profitable,
sought with increasing ingenuity to get the cultivator into his clutches and
oust him from his land. He imposed such hard terms in his mortgages that a
mortgage nearly always ended in sale. Land was, thus, becoming the property of
the sahukar or money lender.
1The locality known as Bagh Rama Nand is
believed to have been the estate of Rama Nand Saraf who had come to occupy a
prominent position among local banders at Amritsar.
2As a result of the territorial expansion since
1799, Ranjit Singh’s dominion suffered a huge deficit and its revenue amounting
to nearly Rs.30,00,000 per annum, had been mortgaged to Rama Nand, the rich
banker of Amritsar, who alos kept Maharaja Ranjit Singh’s accounts of revenue
receipts and expenditure.
The
various abuses in money-lending attracted the attention of the Government,
which came out with came out with the requisite legislation to safeguard the interests of the borrowers,
i.e. the agriculturist. The Government realized the gravity of the problem of
rural indebtedness and felt that unless some antidote was given, the evil might
altogether alienate the rights of the tillers to the soil and pass on the land
to the money lenders. This evil led to the passage of the Punjab Alienation of
Land Act, 1900(XIII of 1900). Since then, the money lender has been content
with the produce, and a new class of
agriculturist money-lender has come to the fore. The bulk of the usufructuary
mortgage debt passed into their hands and they have rapidly increased their
credit operations.
The
passage of the Punjab Alienation of Land Act, 1900 (XIII of 1900), however, did
not better the lot of the tillers. The sahukar, deprived by the Act of the
security of the land, could only lend up the limit of what could be repaid from
the produce. But the agriculturist money lender, to whom the Act did not apply,
could afford to lend up to the value of the land. He was at liberty to offer
attractive terms to the tillers. He was more merciless than the rural money
lender (sahukar) and was always on the look out for the misfortunes of the
borrowers. The Act, thus, aggravated the difficulties of the borrowers instead
of alleviating them.
The
passage of the Punjab Regulation of Accounts Act, 1930, the Punjab Relief of
Indebtedness Act, 1934, the Punjab
Debtors’ Protection Act, 1936, and the Punjab Registration of Money lenders
Act, 1938, adversely affected the village money lnders. This created a scare in the minds of the
moneylenders who restricted their credit operations. Consequently, a need was
felt to create some agency for
providing finance to the
agriculturists. The Royal Commission on Agriculture recommended the development
of co-operative Societies Act was passed
in 1904. Under this Act, the first Co-operative Thrift and Credit Society in
the district was registered on 1st April, 1908, in the village of
Pakharpura (Tahsil Amritsar) and the second society was registered in the
village of Ramdewali (Tahsil Amritsar) on 3rd April, 1908. These
credit societies were registered with unlimited liability and were successful
in meeting the needs of the people of
rural areas. Gradually, the membership of the co-operative societies
increased. The co-operative experience revealed that the societies must have
some central institution for the facility of finance. Accordingly, the
Co-operative Societies Act, 1912, was
passed, and it widened the scope and permitted the registration of secondary
societies. Thus, there came into existence the Chetanpur Co-operative Bank
Union, which was registered on April 5,
1919, for providing finance for its member societies. It was followed by other
Co-operative Bank Unions formed at Tarn Taran, Mud Khokar and Vachhoa in the
district. These small banking unions were subsequently amalgamated into the
Central Co-operative Bank, which caters to the needs of co-operative societies
of various types in the district.
The
passage of the various enactments by the Government also affected the agriculturist
money-lender. He, therefore, explored other channels to invest his surplus
funds, and , finally, he was
effectively checked when the Punjab Alienation of Land Act, 1900(XIII of 1900), was repealed with the enforcement of the
Constitution of the Republic of India on January 26, 1950.
BANKING, TRADE AND COMMERCE
(i) Indebtedness, Rural and Urban
By indebtedness we mean the amount
borrowed by the people from various sources for investment in various fields. Rural
indebtedness is the amount borrowed by the agriculturists from various sources.
These borrowings are to be used for the improvements in agriculture, for the
purchase of improved agricultural implements, better seeds, fertilizer, etc.
But the amount thus borrowed is not generally used for the purpose for which it
is borrowed. The funds are used for other purposes because of the extravagant
habits, orthodox customs and heavy expenditure on ceremonies by the farmers.
The
amount borrowed by the industrialists, traders and other business communities
refers to the urban indebtedness. Contrary to the rural indebtedness, the
amount borrowed is generally used properly in their respective establishments.
Rate of Interest.__ The Co-operative Societies advance loans at
rates of interest ranging from 2 ½ percent to 8 ½ percent. The loans advanced under the State Ais ot Industries
Act, 1935, carry interest from 2 ½ per cent to 6 ½ pre cent. The Joint Stock Banks advance loans against jewellery,
ornaments, etc, at the interest rates of 6 to 12 per cent. The indigenous money
lenders charge interest varying from9 to 36 per cent. The loans advanced by the
unregistered money lenders carry much higher rate of interest, usually ranging
from 60 to 100 per cent per annum. The scale of the rates of interest depends
upon the nature of the loan and on the financial condition of the borrower. In
some cases, the interest is recovered in kind and it is charged at harvest
time. For instance a sahukar lends a quintal of wheat and he recovers one
quintal and a half at the time of harvest in lieu of the loan.
Usury
has, however become out of fashion nowadays, because people have become literate and adequate banking facilities are
available to meet their demands. This system still exists in the remote corners
of the district, where educational facilities are hardly available and the
money lenders are making the best use of the backwardness of the people.
(ii) Role of Private Money-lenders and Financiers
Money-Lenders.__ The supremacy of the bania or village
money-lender is still unchallenged in the field of rural finance. This is due
to inadequate funds at the disposal of the Co-operative Department, and also
due to the fact that the ruralpeople have not yet fully understood the meaning
of co-operation. Moreover, they have not yet realized the benefit of thrift and
saving. The whole co-operative structure is mainly based on credit, and thrift
is there only in name. Nevertheless, co operation has succeeded in lessening,
if not in rooting out , the fraudulent practices hitherto adopted by the bania
or sahukar.
There
are several methods of advancing loans, such as loans on personal surety,
against produce, land, ornaments, property, etc. The main business of the rural
money lender is to lend money to the needy and he is responsible for the
largest amount of the banking credit available in the rural areas of the
district. Generally, the money lender has his grocery shop in the village and
he advances loans to the people for consumption and at the time of harvest he
takes the crops into his possession to clear his debt and disposes it of
according to his own will. He does not charge a fixed rate of interest on all
such loans. The rate of interest varies from person to person. He lends either
on the security of ornaments or on the promise of payment at the next harvest.
Generally , he advances sums which are 60 to 70 percent of the face value of the property pledged against the
loan advanced. The rate of interest is generally higher on a loan advanced on
personal surety than that on a loan advanced against property. As the Punjab
Regulation of Accounts Act, 1930, necessitates the maintenance of accounts,
most of the transactions in the villages are made there orally or against ornaments.
In times of famine, scarcity, at the birth of a son or at the marriage of a
daughter, the rural money-lender is the refuge of the indigent cultivator. In
fact, he is truly the custodian of the honour of the peasants and caters to
their needs. The Punjabi proverb “Guru bina gat nahin, shah bina pat nahin”
holds good in case of the money-lender.
The local money-lender played an important role inproviding industrial rural finance. The passage of the Punjab Regulation of Accounts Act, 1930, affected the private money lending business adversely. Some of the professional money-lenders gave up their trade and took to other professions. However, the hereditary money-lenders still continue their business, because they find it more profitable. Money lending is regulated under the Punjab Money lenders Act, 1938, which requires the money lenders to maintain regular accounts in the books prescribed under the Act. Besides, the money lenders are required to get themselves registered with the collector and get a licence under the provisions of the Punjab Registration of Money lenders Act, 1938. The number of registered money-lenders in the district in 1968 was 200. Besides, there are a number of unregistered money lenders.
(iii) Government and Semi-Government
Credit Agencies
Besides the local money lender, loans are also obtained from Government institutional credit agencies, such as the Punjab Financial Corporation, Khadi and Village Industries Commission, Joint-Stock Banks, and Co-operative Societies. The Punjab Financial Corporation and the Khadi and Village Industries Commission cater to the financial needs of large-scale and medium scale, and Khadi and village industries, respectively.
The
Government also advances loans to the agriculturists for the purchase of seeds,
cattle, tractors, agricultural implements, etc. Loans are also advanced under
the State Aid to Industries Act,1935. Loans advanced by Government as taccavi
loans and those under the State Aid to Industries Act, 1935, are detailed in
the chapters IV and V’ ‘Agriculture and Irrigation’ and industries
respectively. The Co-operative Societies advance loans against promissory
notes, whereas banks do so against gold, shares and securities agricultural
commodities and other easily marketable goods.
Amritsar
is a big center of trade and commerce. Among the urban areas of the district,
it occupies a unique position. In the beginning, the mode of the joint-stock
banks was unknown, and the main instrument of payment was the darshani hundi.
This system was somewhat similar to the cheque system prevailing nowadays. The
hundi was purchased by the traders at par, above par or below par, and this was
a negotiable instrument. The major firm doing this business was Messrs Narain
Dass Chella Ram, having its indigenous bank branches in the Punjab, the
North-West Frontier Province and Sind. Besides the darshani hundi, there used
to be mudti hundi for fixed days, i.e.thirty, sixty, ninety and one hundred and
eighty days respectively. The interest was calculated and deducted beforehand
and it was always drown on self. Another instrument of credit was the
stamp-paper which was a form of deposit.
The
system of mudti hundi was very delicate and sensitive. If the hundi was not honoured,
the purchaser party was declared bankrupt on the spot. In the rural areas,
certain defects crept in this system, because the traders did not observe the
rules and regulations properly. As a result, this system gradually became
unpopular and paved the way for the joint stock banks.
(iv) Joint Stock Banks
Banking was known and pratised in
India at a time when the rest of the world had yet to evolve a medium of
exchange in the form of money. However, the organized joint stock banking
institutions on Western lines began to develop in the country about the middle
of the nineteenth century. In India, these banks have passed through varying
fortunes. In the first decade of the twentieth century, there was a mushroom
growth and consequently there were bank failures on a very large scale. The
weeding out of the inefficient and uneconomic units and the merger of the
weaker ones into the stronger ones helped to strengthen the banking structure.
The
first joint stock banks established at Amritsar were the Punjab National Band
and the People’s bank of India. The later withered away very shortly. The
Punjab National Bank (floated in 1894)
established its branches in 1901 and other banks followed suit. The
collapse of so many banks during the last few months of 1913 was extremely bad
for trade and entailed serious consequences to the depositors. It had, however,
some good results. Many of the banks which collapsed had failed to observe even
the most elementary principles of
banking and had merely attracted deposits by offering impossibly high
rates of interest. The sounder banks reaped the benefit from very largely
increased deposits.
Now
the banking structure in the country is quite solid. Neither the depression of
the thirties nor the World War II (1939-45), nor even the cataclysmic partition
of the country in 1947 gave any serious set-back to the joint stock banking in
India, although it has not remained unscathed altogether.
The
development of banking in India, during and after the World War II presents an
impressive picture, but it has not been free from certain undesirable features.
Some of these defects were removed through suitable amendments of the Indian
Companies Act, but there still remained an urgent need for comprehensive
legislation to safeguard the interests of the depositors. This was done through
the Banking Companies Act 1949, and
through subsequent amendments.
The
number of banking offices at various places in the district, as on March 31,
1968, was as under:
|
|
Total |
Located in theRural area |
Located in the urban area |
|
State Bank of India |
4 |
- |
4 |
|
State Bank of Patiala |
1 |
- |
1 |
|
Punjab National Bank |
9 |
1 |
8 |
|
Other Commercial Banks |
26 |
1 |
25 |
|
Co-operative Banks |
12 |
8 |
4 |
|
Total |
52 |
10 |
42 |
(Statistical Abstract of Punjab 1969, p. 556)
The
different leading joint-stock banks, including foreign banks, which have their
branches in the district , are as under:
The total deposits and bank credit in the
district, as on June 30,1970, amounted to 4453 lakhs of rupees respectively.
(v) Co- operative Credit
The co-operative movement in the district was started after the
enactment of the
Co-operative Societies Act, 1904, and the subsequent Act of
1912. The first two co-operative
Societies in the district were organized and registered in 1908 in the villages
of Pakharpura and Ramdewali, Tahsil Amritsar. The movement gained momentum with
the passage of the Acts of 1954 and 1961. Consequently, a number of
co-operative societies came into being at various places in the district. On
June 30, 1968, there were 2086 Co-operative Societies in the district. Of these, 1343 were
co-operative Credit Societies (1163
agricultural and 180 non agricultural). Besides, a Central Co-operative Bank also
functions at Amritsar, with branches at Rayya, Patti and Tarn Taran.
Co-operative
Credit Societies.__ Ordinarily, the
money-lender provided loans and other essential commodities to the borrowers on
credit. For the recovery of his dues, he preferred to buy the produce himself
at concessional rates. The explaitation of the peasants by the money-lender
worked like a doubled-edged blade, a high rate of interest on the loans
advanced to the poor agriculturists and the low proce given for their produce.
The Punjab Registration of Money-Lenders Act, 1938, curtailed to some extent
the powers of the money-lenders. But the organization of the co-operative
societies aims at eliminating the money-lender as a class.
There
were 1343 cp-operative credit (agricultural and non-agricultural) societies in
the district in 1967-68. The functions of these societies are to mobilize
savings of the members and to advance loans at reasonable rates of interest for
productive purposes.
The
details regarding the membership and the working of the agricultural and
non-agricultural co-operative credit societies, functioning in the district
during 1963-64 to 1967-68, are given in Appendices I and II
on pages 254-255.
(c) Insurance and Small Savings
Insurance.__ Before the establishment of the Life Insurance
Corporation in 1956,
the following companies, covering
life and other risks, were functioning at Amritsar :-
1.
The
Oriental Government Security Insurance Company Ltd.
2.
The
Bombay Mutual Life Insuracne Company Ltd.
3.
The
New India Insurance Company Ltd.
4.
The
Bharat Insurance Company Ltd.
5.
The Laxmi
Insurance Company Ltd.
6.
The
Sunlight of India Insurance Company Ltd.
7.
The
Hindustan Co-operative Insurance Company Ltd.
8.
The
Jupiter Insurance Company Ltd.
9.
The
Hindustan Insurance Company Ltd.
10.
The
Empire of India Insurance Company Ltd.
11.
The
Bombay Life Insurance Company Ltd.
12.
The
Industrial and Prudential Insurance Company Ltd.
13.
The
Ruby General Life Insurance Company Ltd.
14.
The
Great India Insurance Company Ltd.
15.
The
New Asiatic Insurance Company Ltd.
16.
The
Metropolitan Insurance Company Ltd.
17.
The Asian
Insurance Company Ltd.
18.
The
Sterling Insurance Company Ltd.
19.
The
Sunlife Insurance Company Ltd.
20.
The
Indian Mercantile Insurance Company Ltd.
21.
The
Calcutta Insurance Company Ltd.
22.
The
Indian Globe Insurance Company Ltd.
The life insurance business in the
district is, at present, carried on by the Life Insurance Corporation of India,
whereas the general insurance business is done by The Oriental Fire and
General Insurance Company Ltd., The
National security Insurance Company Ltd., The Calcutta Insurance Company Ltd,
The Hindustan Co-operative Insurance Company Ltd. The Vulcan Insurance Company
Ltd., The Jupiter Insurance Company Ltd., The British India Insurance
Company, The Universal Insurance
Company , the Howrah Insurance Company , The New India Insurance Company, The New Credit Insurance Company, The Anand
Insurance Company, The National Insurance Company, The Great American Insurance
Company, The Ruby Insurance Company, The Co-operative Insurance Company, The
Hindustan General Insurance Society, The Concord of India Insurance Company,
The Indian Trade and General Insurance Company, The Zenith Insurance Company,
The Sterling General Insurance Company, The Indian Mercantile Insurance
Company, The Pherex Insurance Company, and The Odeon Insurance Company, all
functioning at Amritsar.
The
Life Insurance Corporation of India covers the life risk, whereas the general
insurance of every kind, except that of life is carried on by the other
companies. The Life Insurance Corporation opened its first branch office at
Amritsar on September1, 1956. The jurisdiction of this branch extends to the
thanas of the Amritsar city, Cantonment and Sadr, Kathunangal, Majitha and the
Ajnala Tahsil. With the expansion of business in the district, two additional
branches to cater to the insurance needs were established at Amritsar proper on
June 15, 1959, and on July15, 1963. In order to intensify the drive for
insurance in the rural areas, one branch at Tarn Taran was opened on March 21,
1960, with a network of Development Officers at various centers of the
district. This branch office covers the Tarn Taran and Patti tahsils and thanas
of Jandiala Guru and Beas. The Life Insurance Corporation on March 31, 1968 had
58 Development Officers at Amritsar ( Units I, II and III ) and 14 at the Tarn
Taran Branch for securing business in the district. The number of agents in the
district, as on March 31, 1968, was 1141.
The
Life Insurance Corporation also advances loans at the rates of 6 and 7 ½ per cent against policies and houses
respectively.
The following statement shows the
branch wise business secured by the Life Insurance Corporation of India in the
district during the five years from 1963-64 to 1967-68:-
|
Name of Branch |
Year |
|||||||||
|
1963-64 |
1964-65 |
1965-66 |
1966-67 |
1967-68 |
||||||
|
No. of Policies |
Amount (Rs.) |
No. of Policies |
Amount (Rs.) |
No. of Policies |
Amount (Rs.) |
No. of Policies |
Amount (Rs.) |
No. of Policies |
Amount (Rs.) |
|
|
Amritsar-I |
3659 |
20126000 |
2234 |
15718000 |
2179 |
13640000 |
2187 |
15803250 |
2154 |
17618750 |
|
Amritsar-II |
3107 |
18668500 |
2011 |
13323000 |
1871 |
13193000 |
2034 |
16296750 |
2311 |
21828250 |
|
Amritsar-III |
857 |
5733250 |
994 |
7768000 |
1369 |
9732500 |
1355 |
10727500 |
1314 |
1203530 |
|
Tarn Taran |
1894 |
6818000 |
1567 |
6267000 |
1804 |
9066750 |
1844 |
10198000 |
1882 |
1180750 |
(Source: Divisional Manager, Life Insurance
Co-operation of India, Divisional Office, Jullundur)
Small
Savings.__ Small savings is a Central Government-
sponsored scheme controlled by the Ministry of Finance ( Department of Eonomic
Affairs ). The National Savings Commissioner for India, with his headquarters
at Nagpur, is the Head of the Department of National Savings Organization. The
Scheme has been primarily introduced for inculcating in the masses the habit of
thrift and raising funds needed for the development of the country. The
movement has become very popular,especially among the rural people, and has,
thus, acquired a great significance. In the States of the Country, the National
Savings Organization is headed by the Regional Director,National Savings,
Government of India. The regional Office for the Punjab is located at
Jullundur. The Regional Director, National Savings ( Government of India ) ,
Punjab, Jullundur, has, under him, three Assistant Regional Directors, National
Savings, at Jullundur, Patiala and Amritsar. In each district, there is a
District Organizer, National Savings Scheme. But, in some of the important
districts, like Amritsar, there are two District Organizers.
In
order to have better co-ordination between the Central Organization and the State
Governments, Directorates of Small Savings have been set up in various States.
The Director, Small Savings, Punjab, Chandigarh, is at the head of the State
Government Small Savings Department. At
the district level, the District Organizers are the co-ordinating agencies
between the Central Organization and the district authorities. They provide
necessary assistance to the district authorities in the promotion and growth of
the movement.
The
number of accredited agents, who worked for small savings on commission basis
in the district, as on March 31, 1968, was 105.
The gross and net collections under the Small Savings Scheme in the district, during the period 1961-62 to 1967-68, are given below:-
|
Year |
Gross investments (Rs.) |
Net investments(Rs.) |
|
1961-62 |
32225775 |
6947357 |
|
1962-63 |
32453503 |
1414574 |
|
1963-64 |
34097578 |
5970888 |
|
1964-65 |
36416546 |
4471999 |
|
1965-66 |
40948222 |
6655076 |
|
1966-67 |
41654378 |
8248688 |
|
1967-68 |
49722347 |
3676318 |
(Source : Deputy Commissioner, Amritsar)
BANKING, TRADE AND COMMERCE
During the Mughal period, the mercantile affairs of the kingdom were generally transacted in round mohars, rupees and dams. The copper coin called dam, paisa or fulus formed the fortieth part of the silver rupee. For the purpose of accounts, the dam was divided into twenty-five parts, each of which was called jital. Up to A.D.1616, the official rate of exchange was 40 dams for a rupee but,from A.D. 1627 onwards, the rupee was worth 30 dams or a little more or less.3
The coins under the Sikh Government consisted of the silver rupee and the gold bugti besides copper coins of smaller denominations. The gold bugti was equal to five rupees. During the Sikh period, mints existed at Amritsar and Lahore, besides those in the provinces of Multsn, Kashmir,Derajat and Peshawar. The gold coins were usually minted at Lahore.4
Under the British and after the independence (1947) up to April 1, 1957, the coinage consisted of the silver rupee and eight-anna and four-anna pieces, the nickel two anna and one anna pieces, besides the copper pice and pies. A rupee consisted of 16 annas or 64 pice or 192 pies. An anna was equal t 4 pice or 12 pies, and a pice was equal to 3 pies.
The decimal coinage was introduced into the country from April 1, 1957. The new system has made calculations and the keeping of accounts easy and simple. The Government issued pamphlets and distributed posters among the public to acquaint them with the new system. Besides, the conversion tables were displayed at all prominent places of money transactions. Being a prominent center of trade and commerce, the Amritsar District has been favourably affected by the reformed coinage system.
The decimal coinage completely replaced the old prevalent coinage with dffect from April 1, 1964. In the beginning, the people, especially in the rural areas, felt some difficulty in transactions, as they were accustomed to counting under the old coinage system. But gradually, they started counting according to the new system, which became popular in the urban as well as in the rural areas. Naya paisa, named so in the beginning, is now called paisa. With the withdrawal of the old coinage from circulation, the prefix ‘naya’ became redundant and was dropped from June 1, 1964.
3Sarkar, S.C.and Datta, K.K.,Modern Indian History,Vol .1 (Allahabad, 1942), pp. 298-99.
4Chopra, Gulshan Lal, The Punjab as a Sovereign State (1799-1839) ( Hoshiarpur, 1960) pp.152-55.