human development

The history of the rupee traces back to 15th century, when the first "rupee" is believed to have been introduced by Sher Shah Suri (1486–1545), based on a ratio of 40 copper pieces (paisa) per rupee. Ancient India in circa 6th century BC, was one of the earliest issuers of coins in the world, along with the Chinese wen and Lydian staters. The origin of the word "rupee" is found in the Sanskrit rūpya "shaped; stamped, impressed; coin" and also from the Sanskrit word "rupa" meaning silver.

The original rūpaya was a silver coin weighing 175 grains troy (about 11.34 grams). The silver coin remained in use during the Mughal period as well as in British India. Among the earliest issues of paper rupees include; the Bank of Hindustan (1770–1832), the General Bank of Bengal and Bihar (1773–75, established by Warren Hastings), and the Bengal Bank (1784–91).

The Indian rupee was a silver based currency during much of the 19th century; which had severe consequences on the standard value of the currency, as stronger economies at that time were on the gold standard. During British rule, and the first decade of independence, the rupee was subdivided into 16 annas. Each anna was subdivided into either 4 paisas, or 12 pies. So One rupee was equal to 16 Annas, 64 Paises of 192 Pies. In 1957, decimalisation occurred and the rupee was divided into 100 Naye Paise (Urdu/Hindi for new paisas). After a few years, the initial "Naye" was dropped.

For many years in the early and mid-20th century, the Indian rupee was the official currency in several areas that were controlled by the British and governed from India; areas such as East Africa, Southern Arabia and the Persintroduction.

Rupee is the name given to the official currency that is used in several countries including India, Bhutan, Pakistan, Sri Lanka, Nepal, Mauritius, Maldives and Indonesia. The name rupee comes from the Sanskrit language word ‘rupyakam’ meaning silver coin. Rupee in different regions is denoted with different symbols most commonly Rs, ₨ and Rp. One unit of the currency is equivalent to one hundred equal paise.

Among all the countries mentioned above that have rupee as their national currency; the Indian rupee is the most important with respect to value, preference and popularity. India stands among those countries that discovered the need for a currency and the first rupee coins were issued as early as in the 16th century. The currency code and numeric code for Indian rupee according to the ISO 4217 standard are INR and 356 respectively. The currency in India is denoted with the sign Rs.

Overview

India retains the reputation of issuing the some of the earliest coins in the history of mankind. The currency of India i.e. the Indian rupee is also one of the well-established currencies in the world. The importance of the Indian rupee in the world market is characterized by the fact that Bhutan and Nepal peg their currencies to the Indian rupee. Moreover, the Indian rupee is considered a legal tender in Bhutan that has dollorized the currency. Indian rupee does not use the western number system and has a number system of its own. As in the western number system, the large values of money are counted in terms of hundred, thousand, million and billion respectively, in the Indian number system the large values are counted as hundred, thousand, lakh and crore. The Indian number system is also popular among the countries like Pakistan, Nepal, Myanmar, Bhutan and Bangladesh.

Earlier the rupee coins were made up of silver and that is where this name ‘rupee’ is derived from as the word ‘rupyakam’ means silver coin in the Sanskrit language. But when the large silver mines were discovered in the United States of America and parts of European continent, the value of silver declined drastically as compared to gold on which all the other strong economies were based. As a result, the value of Indian rupee also declined as compared to other currencies in the world and this incident is called the ‘fall of rupee’.

Among the many ways to invest money, the vast majority of people invest money in the currency of their country, which can be done through forex trading.

Structure

Indian rupee did not use the decimal system and rather was subdivided into 16 annas till 1957. In 1957, the decimal monetary system was adopted and one unit of rupee was restructured equivalent to 100 equal paise. The currency in the country is issued in the form of banknotes and coinage, the Reserve Bank of India and the Government of India possessing the issuing authority for banknotes and coins respectively. The central bank i.e. the reserve bank of India is entitled to change the banknote series and the Mahatma Gandhi series, which is in circulation currently, was launched in 1996. The notes are issued in 7 denominations i.e. Rs 5, Rs 10, Rs 20, Rs 50, Rs 100, Rs 500, Rs 1000. Two more denominations for banknotes i.e. Rs 1 and Rs 2 are still in circulation but no new notes are being printed as coins for both these denominations are being minted now. Each note depicts the face value of the note in 17 languages. The notes also have some unique features quite often called the security features that help in avoiding the duplicity and illegal circulation of the notes. These features include

    Mahatma Gandhi watermark

    Silver security

    Latent image

    Micro-lettering

    Fluorescence

    Optically variable ink

    Back to back registration

Coins for the Indian currency are minted in 7 denominations namely 10 paisa, 20 paisa, 25 paisa, 50 paisa, Rs 1, Rs 2 and Rs 5 under the Coinage act 1906. The country has four coin mints one each at Mumbai (Maharashtra), Hyderabad (Andhra Pradesh), Kolkata (West Bengal), Noida (Uttar Pradesh). Like in the case of banknotes, the management of circulation of coins is in the hands of the Reserve Bank of India.