Which of the following phrases defines the nature of the 'Hundi' gener

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

[amp_mcq option1=”An advisory issued by the king to his subordinates” option2=”A diary to be maintained for daily accounts” option3=”A bill of exchange” option4=”An order from the feudal lord to his subordinates” correct=”option3″]

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UPSC IAS – 2020

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‘Hundi’ is a traditional financial instrument widely used in India for trade and credit transactions. It functions as a bill of exchange, a promissory note, or a draft. It allowed merchants to transfer money from one place to another without physically carrying cash, reducing the risk of theft, or to borrow/lend money based on written promises. The term and instrument were prevalent in the post-Harsha period and continued to be important throughout the medieval and colonial eras.

A Hundi is essentially an indigenous form of a bill of exchange used for transferring funds or credit.

There were various types of Hundis, such as Darshani Hundi (payable on sight) and Mudati Hundi (payable after a fixed period). The Hundi system facilitated trade and commerce across long distances in India.

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