Indian Currency System

The historical background of the Indian currency system which is as follows:

·      First gold coins were introduced during the reign of the Gupta’s in 390-550 A.D.

·      In 1947, India became the member of the IMF and exchange value of the Rupee came to be fixed by IMF standard.

·      Paper currency in India was introduced in 1882 by the British Government.

·      Rupees was the first minted in India during the reign of Sher Shah Suri around 1542 A.D.

·      With the establishment of the RBI in 1935, the Indian Rupee became an independent currency, although for exchange purposes it continued to be dependent on sterling.

Decimal System

Let us now discuss the decimal system of the Indian currency:

·      All Coins and One Rupee notes are issued by the Government of India and therefore, the one Rupee notes does not bear the signature of the Governor of the RBI.

·      Each note has its amount written in 15 languages (English and Hindi and 13 other languages), illustrating the diversity of the country.

·      The Currency notes of Rs. 500, bearing a portrait of Mahatma Gandhi and Ashoka Pillar emblem were issued by RBI from 3 October 1987.

·      The Current Series which began in 1996 is called the “Mahatma Gandhi Series”.

·      The first one-Paise coin under the decimal system was issued in March 1962 and the first one Rupee coin in July 1962.

·      The Indian currency system was converted into decimal system by the Indian Coinage Amendment act 1955 which was brought into force from 1 April 1957. The old system of Rupee, Annas, and Paise was replaced by Rupee and Paise system.

·      The Mahatma Gandhi Series of banknotes is issued by the Reserve Bank of India as the legal tender of Indian Rupee. As the name suggests, the series is so called because the obverse of the banknotes prominently display the portrait of Mahatma Gandhi. Since its introduction in 1996, this series has replaced all issued banknotes.

·      The Indian rupee symbol (officially adopted in 2010) is derived from the Devanagari consonant (Ra) with an added horizontal bar. The symbol can also be derived from the Latin consonant “R” by removing the vertical line, and adding two horizontal bars (like the symbols for the Japanese and the euro). The first series of coins with the rupee symbol was launched on 8 July 2011.

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