Promissory text of Bank of Bengal banknotes

by
Nilaish
Life Member IBNS-IBCC


Paper money is an instrument which circulates money from place to place. Indian banknotes are known since 1770, but there is no specimen or issued note known before 1812. The earliest banknotes which is seen in Razack et al. (2012) shows notes of Bank of Hindostan, Bank of Bengal, Bank of Bombay and Bank of Madras. There were three presidencies; Bengal, Bombay and Madras where these government and private joint stock banks circulated banknotes in India.  These notes were promissory notes issued on demand and were paid on demand. The below excerpt of Bank of Hindostan banknote shows the promissory note as;

Bank of Hindostan 10 Sicca Rupees banknote's promissory text: 

ON DEMAND I PROMISE to pay to.................... or bearer Sicca Rupees TEN. 

Image Courtesy: Rezwan Razack 

All other issues of bank of Hindostan had same promissory text. The earliest known banknote which has survived is dating to 1812 of Bank of Bengal. The promissory text of note dating to 1813 shows following text: 

Bank of Bengal 250 Sicca Rupees banknote's promissory text: 

We Promise to pay to Mr W. Morton or Bearer on Demand Two Hundred and fifty Sicca Rupees. 

The minutes of meeting of Bank of Bengal in 1809 as seen with Victoria Memorial (see below) explains the name in the promissory text. Mr W. Morton was the Treasurer and Secretary of Bank of Bengal in 1809. His name is mentioned, if bearer looses the note then the payment will be done back to the Treasurer?! Please see the copies of the minutes of meeting and a copy of Governor General, Lord Minto was sent notification from the bank (please see below). 

Minutes of Meeting Page no.1: 

At a meeting of the directors of the Bank of Bengal on Monday the 2nd January 1809,

Present:

{ R.W. Cox,

Hon. S.G. Tucker,

W. Egerton, 

A. Colvin,

J.W. Fulton,

G. Tyler,

John Palmer,

John Alexander,

Maharaja Sookmay Rae} Esqrs. 

The directors having received the Charter of Incorporation from the right Honourable  the Governor General in Council and taken the oaths of office before him, resolve that the charter be reach. 

Resolved that Mr. Tucker be appointed President. Resolved that Mr. Morton be appointed Secretary and Treasurer. Mr Henry Tyler Accountant and Ramchander Rae Khazanchy and that the following letter be addressed to the Governor General in Council

To the Right HON'BLE GILBERT LORD MINTO 

Governor General in Council 

& & & 

Communication letter of Bank of Bengal to Lord Minto: 

My Lord, We have the honour to report of your Lordship in Council, that We have nominated Henry S. George Tucker, Esq. our President and apointed Mr. W. Morton, Secretary and Treasurer, Mr. Henry Tyler Accountant and Ramchander Rae Khazanchy of the Bank of Bengal, We request that the officers of the Bank may to be the presented Oaths before your Lordship agreeably to the conditions of the Bank. We have the Honour to be, My Lord. 

Later series had some changes in the promissory text. Type 1, 2, 3, 4, 5 and 6 have same promissory text but type 7 had different text please see below: 

Type 3: 

We Promise to pay to Mr W. Morton or Bearer on demand Sixteen Sicca Rupees. 

Type 6: Similar 

Type 7: 

I Promise to pay Mr W. Morton or Bearer on demand One Hundred Company's Rupees. 

Between 1853 and 1856 notes had similar promissory text but the later issue had different Promissory text. The last issue is called Britannia series which contained uniform promissory text: 

Type 10: Britannia Series 10 Rupees note - 

I Promise to pay the Bearer on demand Rupees TEN / 1857 Aug 31st Calcutta 31st Aug 1857.  

In 1861 first currency act was passed in India and all banks were not allowed to issue promissory notes. 

Copyright Nilaish, Esq. All rights reserved. 

Investing in old Indian Banknotes of British Raj

Nilaish

Life Member IBNS - IBCC
(Report) 

Everyone spends it daily from their wallets ... hundreds and thousands! I bet that very few people check the notes before spending it. I had been collecting Indian Paper Money since 1997 and yet not grown out of that passion! It is an adventure sport which makes you educated on the way. I was not aware that in India; banknotes were used  since 1810. The earliest survived note is dating to 1812 of Bank of Bengal. This bank is known as oldest government bank in India. It was established by East India Company under shareholder-ship with fellow joint stock firms. They were banks even before 1800s, Bank of Hindostan was established in 1770 recorded by Amiya Bagachi who wrote the history of banking in particular State Bank of India in volumes.

Collecting Paper Money of India 

I will share some collecting experiences of fellow collectors who enjoy this hobby religiously. The oldest ever catalogue on Indian paper money as sub-chapter was published by Krause Publications in South Asian Money and in Standard Catalogue of World Paper Money by Albert Pick in 1977 (?). There was less information about Indian Paper money readily available for collectors. In 1997, an industrialist from Mumbai; Kishore Jhunjhunwalla wrote a catalogue of Indian Paper money since 1950.  Later he advanced the topic by publishing, 'The standard reference guide to Indian Paper Money' in 2000. This book was widely circulated among the different banknotes collectors and dealers worldwide. The epitome of this subject, his book was awarded Book of the Year by International Banknote Society. An international society of banknote collectors having more than 200,000 collectors as its members. 

Rezwan Razack, Joint MD, Prestige Group with his few favorite old Indian notes 

Image Courtesy: Mid Day (Bangalore) 

Rezwan Razack, another collector of Indian Paper Money, also commonly referred as Joint MD of Prestige Group; renowned Realtor in India started collecting banknotes almost 40 years ago. He collected notes from family friends, cut-note dealers, dealers and reputed auction houses. He also managed to take over Kishore Jhunjhunwalla's collection to do scholarly research which never happened before in Indian collecting atmosphere. He researched at several museums, libraries and books to bring together many hidden facts about Indian Paper Money. This laborious love resulted in co-authoring The revised standard reference guide to Indian Paper Money with Kishore Jhunjhunwalla in 2012. Rezwan's collection of Indian Paper Money is an unique collection ever put together (Above: Rezwan showing his few favorite notes to media). Presently he is also Chairman of International Banknote Society, Indian Banknote Collector's Chapter. In his busy corporate schedule; he invites young and fellow collectors to learn this great hobby. A true leader and very compassionate person. Young collectors can meet him for guidance on collecting and joining IBNS-IBCC.

There are also other collectors who engage themselves in buying and selling rare banknotes. There are more than 10,000 serious collectors of Indian Paper Money who dabble among themselves for better grade notes and building their collection. This hobby is still at its infant stage and will grow over time. Some collectors even prefer to remain in dark and enjoy their hobby for themselves. The buying and selling of notes gave a market sub-culture to Indian Banknotes. In India there are several dealers who buy and sell rare Indian Paper Money. 

The most challenging part of India Paper Money 

It is doubtful that anyone has managed to put the complete collection of old Indian Paper Money. The most substantial collection of old Indian banknotes is seen with Mr Rezwan Razack. It is challenging to have Indian notes before 1860.  There were three presidencies in India under East India Company rule namely; Bengal, Bombay and Madras. As the banking system in India progressed, British East India Company issued charters of Bank of Bengal (1806), Bank of Bombay (1840) and Bank of Madras (1843). These banks issued banknotes which were in very limited circulation. The usage was limited to presidency towns like, Calcutta, Bombay (Mumbai) and Madras (Chennai). Wealthy merchants, tea planters and commercial booths frequently used banknotes for denomination higher than 10 Rupees. There were also some private banks established by joint stock ventures between commercial entities. To get one example of these notes is a significant accomplishment.  

Bank of Bengal banknotes (1806-1860) and further

The earliest government bank which was established in India was Bank of Bengal. They started issuing notes since 1810. If we observe the first series of Bank of Bengal (n.1) we extract, Beautiful one side printed, with manuscript date and signature. Mostly the signatures are cut (norm) and CANCELLED by bank. The first accountant of Bank of Bengal, Henry Tyler signed the notes below denomination panel (see below). 

n.1

Bank of Bengal, 1814, 250 Sicca Rupees, banknote

To get an example of this note is almost difficult. People who had invested in these rarities will definitely get very high open returns. There are less than 100 examples remain of these earliest notes of India. We welcome claims to show more than 2 examples of n.1. The later series is called commerce series where 'A personified lady is sitting on the articles of merchandise'. These notes remain very few in number and might get disappeared shortly if people stop  preserving them for the coming generation to see our history. A note shown below is only available from few examples (n.2) of this date: 

n.2

Bank of Bengal, 1000 Company's Rupees, banknote

These notes speak about Indian history so boldly, we can learn evolution of India from it. For rarity you can take comfort, no one can show you another note straight up! There are some great British India issues also which are very hard to get. For example uniface notes with green and red underprint. The portrait notes of British Monarchs were issued as early as in 1862 having portrait of Queen Victoria. A 1863 Queen Victoria portrait note of Rs 10 (n.3) was valued for GBP 30,000-35,000 by SPINK & SON this year for their auction. SPINK & SON is a very old auction house which was established in 1666 in London. However it remained unsold at GB 30,000. Serious collectors confirmed that after buyer's premium and VAT the price should lie between GBP 18,000-19,000. It was felt that it was over priced. 

n.3

1863, Govt of India, Rs 10, Queen Victoria on the left.

Image Courtesy: SPINK

Later issues from 1917 had portrait of King George V. A 50 Rupees note issued in Lahore is exceptionally rare example to collect (n.4). 

n.4

Government of India, Rs. 50, Lahore, Signed by J.B. Taylor, rare. 

There are many rarities in British Indian paper money. A collector will find it stimulative knowing about them. A very rare example in existence! Gets a lot of pleasure for collectors. To have a Rs. 10,000 note of King George V or King George VI is a baffling task. Each of these types are very few in number. 

Investing opportunity 

Presently the demand of rare notes of India is growing day by day. This is a perfect time to invest wisely and start this hobby seriously. It is a lifetime challenge to assemble a substantial collection of old Indian Paper Money or banknotes from British Raj. There are a few notes which have survived and remain with banknote dealers and collectors worldwide. Coins are something which you can find in your grandmother's or grandfather's attic. Banknotes are very hard to preserve over years. Ancient Greek coins are available for even US$ 10! The benefits of collecting Indian Paper money are listed below:

- Hedging Funds.

- Risk Averse Open ended returns over long term. 

- Beats Unanticipated Inflation. 

- Educating hobby. 

- Self Realization of big accomplishment. 

- Easily portable tangible asset. 

- Investment Portfolio Diversification. 

- Pension Plan for life. 

- Joining affluent class.  

There are many more benefits on investing in old Indian Paper Money over long term. The beauty is, no one is considering this hobby as an investment tool but rare stamps index published by Bloomberg for Stanley Gibbons establishes investment on these rare tangible assets. 

Copyright Nilaish, Esq. All rights reserved. 

An Exceptional 10 Rupees of 1863

An Exceptional Rupees 10 note of 8th June 1863 issued by Government of India, Signed by J.A. Ballard, Commissioner, having serial number C/17 30767, circle of issue is Bombay, With some flaws but very rare note! It is estimated £30,000-35,000 by SPINK & SON for their April Auctions of 2014. Image Courtesy: SPINK & SON.  

April 15 & 16, 2014 World Banknotes Sale of Spink at London will comprise this exceedingly rare example of 10 Rupees of India. These notes were the first issue of Government of India after currency act of 1861. The private and presidency banknotes were withdrawn and new design with Queen Victoria portrait notes were issued. A very few notes remain in collections but absent from many collections, reported by Barnaby Faull, Director of Banknotes at SPINK. 

Image Courtesy: SPINK