top of page

The Indian Rupee

Updated: Jun 8, 2023

The rupee that we carry around in our pockets has a mysterious past. Behind Mahatma Gandhi's smiling appearance is a rich legacy of struggle, exploration, and prosperity that dates back to sixth-century BC India.

Let's unravel the history of the Indian rupee and see how Indian currency changed over time to become the rupee we know today.

The Indian rupee can be traced back to the sixth century BCE in ancient India. Along with the Chinese and Lydians, ancient Indians were the world's first coin issuers (from the Middle East). The Mahajanapadas (republic kingdoms) of ancient India struck punch-marked coins known as Puranas, Karshapanas, or Pana around the sixth century BC. Gandhara, Kuntala, Kuru, Panchala, Shakya, Surasena, and Saurashtra were among them.

These coins were made of silver and a standard weight, but had unusual shapes and diverse designs, such as a humped bull in Saurashtra, a Swastika in Dakshin Panchala, and many symbols in Magadha.

Then Chandragupta Maurya, the first Mauryan emperor, created punch-marked coins, which could be made of lead, silver, gold, or copper. Greek portrait engraving on coins was introduced by Indo-Greek Kushan kings. The minting of coins like the Rupyarupa (silver), Suvarnarupa (gold), Tamararupa (copper), and Sisarupa (lead) was referenced in Chanakya's Arthashastra treatise. Chanakya served as the first Mauryan emperor's prime minister.

The Gupta Empire issued numerous gold coins depicting Gupta kings conducting various ceremonies. This tradition of intricately etched coins endured until the Turkish Sultanate arrived in North India.

By the twelfth century AD, the Turkish Sultans of Delhi introduced Islamic calligraphy in place of the royal designs of the Indian rulers. The money was made up of gold, silver, and copper coins known as Tanka and lower value coins known as Jittals. By manufacturing coins with various values, the Delhi Sultanate also made an effort to standardise the financial system.

Beginning in 1526 AD, the Mughal Empire consolidated the empire's monetary system. The genesis of the rupee happened during this period when Sher Shah Suri fought Humayun and minted a silver currency of 178 gms known as Rupiya, which stayed in use throughout the Mughal period, Maratha era, and British India.

Sher Shah's silver rupiya was the accepted standard money in India by the time the British East India Company established itself there in the 1600s. Despite numerous attempts to introduce the sterling pound in India, the rupaiya gained acceptance and was even exported to other British colonies as a form of money.

The English were granted permission by Mughal emperor Farrukh Siyar to coin Mughal money at the Bombay Mint in 1717 AD. The British gold coins were known as carolina, silver coins as angelina, copper coins as cupperoon, and tin coins as tinny.

The Bengal Bank, General Bank of Bengal, and Bank of Hindostan were the first Indian banks to produce paper money in the 18th century during British India.

After the 1857 revolt, the British made the rupee the official currency of colonial India, with the head of King George VI replacing native designs on banknotes and coins.

The British introduced paper money to the subcontinent in the 19th century. The vast expanse of British India was covered by the Paper Currency Act of 1861, which gave the government the exclusive right to issue notes. Eventually, the Controller of Currency, the Accountant Generals, and the Mint Masters were given responsibility for managing paper money.

In 1923, a series featuring George V's portrait was issued, and it has remained an intrinsic component of all British India paper money issuance ever since. The denominations of these notes were Rs 1, 212, 5, 10, 50, 100, 1,000, and 10,000.

On April 1, 1935, the Reserve Bank of India was formally established, with its central office in Calcutta. Up until its own notes were prepared for issuance, the RBI was permitted to continue issuing Government of India notes under Section 22 of the RBI Act of 1934. In 1938, the bank released the first five rupee note featuring George VI's portrait. This was followed by Rs. 10 in February, Rs. 100 in March, and Rs. 1,000 and Rs. 10,000 in June 1938. The first Reserve Bank issues were signed by Sir James Taylor, the second Governor.

Following India's independence in 1947, the modern Rupee reverted to the design of the iconic Rupee coin. The Lion Capital at Sarnath, which replaced the George VI series of banknotes, was chosen as the symbol for the paper money. Therefore, a one rupee note was the first currency produced by Independent India.

On August 15, 1950, the "Anna Series" was first broadcast. This was the Republic of India's first coinage.

Ashoka's Lion Capital took the place of the King's image. The tiger on the one rupee coin has been replaced by a corn sheaf. The existing monetary system was kept, with one rupee equaling 16 Annas. A "Decimal series" was introduced by the 1955 Indian Coinage (Amendment) Act, which went into effect on 1 April 1957. Instead of 16 Annas or 64 Pies, the rupee was now divided into 100 "Paisa."

In 1959 a special issue of rupees ten and Rupees One Hundred were issued for the Indian Haj Pilgrims so that they could exchange it with local currency in Saudi Arabia.

Mahatma Gandhi Birth Centenary Commemorative Issue was issued in 1969. It was the only commemorative note that the Reserve Bank of India had ever issued.

In 1980, new notes were released that included symbols of science and technology (Aryabhatta on the Rs. 2 note), progress (an oil rig on the Rs. 1 and a farm mechanisation on the Rs. 5) and Indian art forms on the Rs. 20 and Rs. 10 notes (Konark wheel, peacock).

Due to a booming economy and declining purchasing power, the Rs. 500 note was created in 1987.

The first notes in the Mahatma Gandhi series, the Rs. 10 and Rs. 500 notes, were released in 1996. All notes from the Lion capital series have been replaced with this series. The new features included a modified watermark, windowed security thread, latent image, and intaglio features for the blind.

On July 15, 2010, India introduced a new currency symbol, the Indian rupee sign, ₹.

In 2011, 25 paise coins and all paise coins below it were demonetised. New series of 50 paise coins and Rs 1, Rs 2, Rs 5 and Rs 10 notes with the new rupee symbol introduced.

The Republic of India experienced its second significant monetary reform in November 2016, when it withdrew the legal tender status of Rs 500 and Rs 1,000 Mahatma Gandhi Series banknotes produced by the Reserve Bank of India till November 8, 2016.

The new banknotes were released as part of the Mahatma Gandhi (New) Series, highlighting the nation's cultural heritage and scientific advancements. The sizes were decreased and distinct colours were utilised for the various denominations. Two new denominations were added to the Mahatma Gandhi (New) Series: Rs 2000 on November 8, 2016, and Rs 200 on August 23, 2017.



bottom of page