Society for Comparative Studies in Society and History

Usury in Medieval India Author(s): Irfan Habib Reviewed work(s): Source: Comparative Studies in Society and History, Vol. 6, No. 4 (Jul., 1964), pp. 393-419 Published by: Cambridge University Press Stable URL: http://www.jstor.org/stable/177929 . Accessed: 12/03/2013 08:03
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USURY IN MEDIEVAL INDIA

By convention the medieval period of Indian history is supposed to begin either with the death of Harsha, c. 648, or, as in this study, with the Turkish conquest of Northern India (about the beginning of the 13th century), and to end on the eve of the British conquests (about the middle of the 18th century). Although this sets a very late date for the close of the Indian medieval period, the arrangement is not illogical, since it was only with the British conquests that India became subject to the modern capitalistic system. But if we can say with certainty that the society of the period previous to British rule was not capitalistic, it is yet not a simple matter to define its basic elements. It is no longer possible to accept the assumption that its economy was based primarily on production for use, and not exchange, and that commodity production and money economy are entirely a gift of British rule. There are in fact strong grounds for supposing that the cash nexus was established in the central parts of the Dehli Empire as early as the beginning of the 14th century; 1 and there is overwhelming evidence at hand to suggest that over large parts of the Mughal Empire (16th and 17th centuries), the land-revenue, which comprised the bulk of the peasant's surplus produce, was collected in money and not in kind.2 From such wide use of money, we should naturally infer the prevalence of money-lending and credit on a large scale. The chief object of the present study is to test this inference by examining the actual evidence from the period relating to usury. The term "usury" has been employed here in the same sense as is sanctioned by usage in writings on medieval European history, namely, lending at interest, whatever the rate or the form of extracting it. We propose to examine the extent of usury, and the various forms in which it was practised, in the different sectors of medieval Indian economy, as well as the ways in which different classes of medieval Indian society were affected by it. It should, however, be confessed at the outset that our information does not come uniformly from the entire period, but comes in the larger measure from the 17th century alone. Moreover, it is full on only some aspects of the subject while being fragmentary or even non-existent on others.
1 Cf. W. H. Moreland, The Agrarian System of Moslem India (Allahabad reprint of 1929 ed., n.d.), pp. 11, 114, 136-7. 2 See my Agrarian System of Mughal India (Bombay, 1963), pp. 236-39.

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which is a summarystatementof the financesof a villagefor the year 169697. The Rupee in Mughal times was of practically pure silver. although its documents purport to come from a fictitious district in Kashmir. pp. and in order to "occasionally" replace draughtcattle.sThat the land-revenue of the peasant'sfalling into debt. annas 9. f. Risala-i Ziridat (c.7 4 For the magnitude of the land-revenue demand in the 16th and 17th centuries. Ind. 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions . 7 The farmdn is reproducedby "Malikzada"in Nigirnama-i Munshi (Lucknow. might have to borrowmoney in order to pay land-revenue. 241-2. and about half as much (Rs 80) was set aside for land-revenue of Ob"repayment loan from the mahajan(professionalmoney-lender)". undoubtedly omy. 'Alauddin Khalji (1296-1316) is said to have taken half of the produce as revenue (Zia'u-d Din Barani.who engage in cultivation. was not by any meansunknown. it does limited.but it is certainthat individualpeasantsalso fell into debt. to observe the rites of or to meet the expensesincurredin prosecuting marriageand bereavement. and many of them owed everything they had to the money-lender. shows that from the amount collected in rates levied upon individual peasants. Tarlikh-i Firiz-shdh7. 1884).a sum of Rs 160. suggestforcefullythat peasantindebtedness A work on land-revenue writtenin Bengal just before the administration. 6 Nandram. 1750). Siyaqnama (Lucknow.the loan from the mahajanhad been taken up by the villagein some demandfor that year. see my Agrarian System of Mughal India. was the principalcause disputesamong themselves. 5 My Agrarian System of Mughal India. MS EdinburghNo.6 viously. 1879). p.but are wholly in debt for their seeds and cattle". 190-96. 16 annas made a Rupee. had to providefor the exemptionfrom the poll-taxof "thepoor peasants(reza ri'aya). probably represents the conditions there.5A specimendocumentpreservedin a late 17th century text-bookon accountancy showshow an entirevillage-community of peasants This document. ed. 287). 77-79.it was not only in lean years that the peasantmight find himself withoutresourcesto pay the revenue:It appearsthat. British conquest.notes that the peasantsfell into debt "mostly"because of the need to pay the land-revenue or to meet the additionaltax-levies. in the 17th centuryat least. therefore. pp. During the 14th century. 144. This work was written in the Ilhabad (Allahabad) province and. lOb. 3 Anonymous. Thus a farman (imperialorder) issued by Aurangzeb(1659-1707) a little before 1684. was paid into the treasurytowardsthe for the year. and weighed 178 or 180 grains. This is a case previousyear to meet the land-revenue of collectiveindebtedness. This content downloaded on Tue.394 IRFAN HABIB Agricultural and Rural Usury Of key importancein any assessmentof the general prevalenceof usury would be a knowledgeof the extent of its penetration of the agrarianeconthis the evidence is but On such as it is.. Bib. can be readily understoodseeing that it generally amountedto a third or half of the total produce of the land.4 Moreover. pp.paymentof revenuewas occasionallydemandedeven before theharvest could be collected.

16 annas) per month. 13 English Factories. 1661-65. The loan was usually advancedfor a period of two or three months. or poll-tax on nonMuslims. II.e. p. defines a practice called bai -i salam as follows: "The grain has not yet appeared in the field. and that they lent nominallyat 11/2 annas in the Rupee (1 Rupee . Add. says that sanyiiss (mendicants) and Baksariyas(infantrysoldiers and "clubmenof zamindirs")8 usually engaged in money-lending(mahajan) in the Bengal villages. p.Here indigo merchantsadvanced in indigo.12 From comes evidence of a still more form of Gujarat 17th-century complex usury. ff. 10 Ibid.l3 This practicewould have provided the creditorwith double means of makinghis gain. p. 18th-century practiceseems to have prevailedextensivelyin the Agra region duringthe 17th century. which they take out in (cotton)yarne". lOb.USURY IN MEDIEVAL INDIA 395 The burdenthat usuryimposedon the peasantcould not have been light. W. 8 Cf. by inflatingthe rate of p.and a fresh bond extractedfrom the borrower. This content downloaded on Tue. Moreland and Geyl. 11 Letters Received by the East India Company from its Servants in the East. 1925). written in the later half of the 18th century and based on the author's experience of Dehli and Bengal. from which the farmin grants exemption.tr. MS Edinburgh 144. 1625-29. The jiziya. a collection of documents compiled in 1684. "they (the usurers)bring about the ruin of the peasantry".by certaindevices."who drive the same trade of giveing out old worme eaten decayed corne in the severall neighbouring villadges. but repaymentdemanded in kind. appearedin close associationwith commerce. Jahangir'sIndia (Cambridge. 9 Risala-i Ziraiat. obtaineda gain of 2 annas per month. except for 'a small parcel bought green in the villages "by mony advanced beforehand". 6603. lla. "Thus. 50a). Sometimes. Mus.constantlytakingcompoundinterest". 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions . f. Here we are told of brokersof Surat. William Irvine.fixing the rate beforemoney to the peasantsand took repayment hand.and the usurercould then enhancehis gainby fixingthe rate of commutationand under-weighing the corn received. Pelsaert. p. the loan was given in cash.and if not repaidwithinit. ed. Yasin's Glossary of Revenue Terms. Cf. but a man purchases it. which we have quoted above. This. 112. was imposed in 1679.it is said. to judge from one recordedinstance. 208)." Besides simple money-lending other forms of usury also prevailedin the in which forms credit villages.'0This statementrelates to but the Bengal. 16. 'Remonstrantie'. 12 In 1627. which cost only 241/2 rupees' (The English Factories in India. work from Bengal. and then seizes the grain when it appears"(Br. 139. The Army of the Indian Moghuls (New Delhi. the differencebetweenthe contractrateandthe marketpricecouldbe quitesubstantial. in 1614. i. ed. 106. p. says our work. Foster. the interestdue was addedto the principal. was reportedto be "a custom and the cheapestcourse of buying". 150% per annum at the simple rate. the English East India Company bought Biana indigo at Rs 35 to 361/2 per maund.-lla. " and. 1961).. in his farmanwas probablycorrectin equatingthe degreeof and Aurangzeb The 18th century a peasant'sindebtednesswith that of his pauperisation. f. Foster. 168. A slightly later work. but actually.

Bib. The term sondhdr was indigenous. It has continued in use in the same region in the sense of money on advance 'given to ploughmen when first engaged" (H. because a Muslim theologian condemned it presumably on suspicion of usurious gain accruing to the State from the transaction. 15 The Rehla of Ibn Battuta. Bib. Elliot.14 of his reign. It was laid down in practically all regulations and instructions issued to Barani mentions this practice neither in his account of CAlau-dDin Khalji's radical agrarianmeasures nor in his passage on Ghiyasu-d Din Tughluq's views on land-revenue administration. 287-91.The sole means of encouraging cultivation that the latter Sultan is said to have recommended was moderation in enhancing the land-revenue. Mahdi Husain (Baroda). The Coinage & Metrology of the Sultans of Delhi (Delhi.15 However. p. The State thereby not only drew an immense income so as to command enormous monetary resources. pp. but its revenues also began to vary in close association with the fortunes of cultivation. 345). The need of the peasant for resources and the evidently high cost of borrowing money from private sources led the medieval State to offer credit to the cultivators from its own resources. 498-9. pp. Until the reign of Muhammad Tughluq (1325-51). (Tafrikh-iFTirzshahl. 1869. historian puts the figure at 20 million tankas. who were to realise the desired object mainly through advancing loans (termed sondhar) to the peasants. 91. II. His object now was to extend cultivation and improve cropping in the Dehli-Doab region. 16 Barani. Ind. ed.. Beames. pp. pp. 14 This content downloaded on Tue. Memoirs on History. p. 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions .396 IRFAN HABIB corn advanced to the villagers as well as underrating the yarn brought by them in repayment. For this purpose he set up a whole body of officials. Folklore & Distribution of the Races of the NorthWesternProvinces of India. This was apparently regarded as an innovation. According to one contemporary historian nearly 7 million tankas (coins of practically pure silver. demanding in return a part of the produce for the State granaries. the advancing of loans to peasants in order to encourage cultivation does not seem to have formed part of the But during a famine in the first decade agrarian policy of the administration. TaOrikh-i Firiz-shahL.. N. 429-31). 88-9. It is not surprising that the State should have begun to assume this role in the first half of the 14th century. almost routine. 391-402. tr. Ind. London. but another. but also by undertaking a far more ambitious project on the same lines a few years later. Muhammad Tughluq ordered the digging of wells and gave money and seeds to peasants around Dehli to help them undertake cultivation. Wright. slightly later.16 What was an innovation in the 14th century became under the Mughals (16th and 17th centuries) a familiar. Under 'Ala u-d Din Khalji (1296-1316) the claim of the State to deal directly with the peasants and to take nearly the whole of the surplus produce was for the first time asserted. the Sultan showed his faith in the new practice not only by executing the hapless scholar. administrative practice. M. Ta'rkh-i Firiz-shahl. especially. 1936). Shams Siraj 'Afif. see H. For the tanka. each weighing nearly 173 grains) were disbursed by the royal treasury to be given out in such loans.

see my Agrarian System of Mughal India. principal)as "profit" ever they borrowedfor plantingsugar-cane. and for the same by muqaddams (village headmen).The loans were eitherat the time of harvestin two instalments. Or.wheneverthey either could not collect the land-revenueor had spent what they had collected. f. ed.or of the land-revenue. 55a-b. Ist Series. Whenever.and these too bore the name of taqav. Add. 285. History of Shhahiahn'sReign. Mus.85/315.particularly when they stood surety.247. 173. I. f.D. 1688-9). Jauhar recordsin his memoirsthat when in 1554 he was appointedRevenue-collector of Patti in the he was distressed to find on the reaching place that Haibatpur Panjab. 424 (A.they paid two annasin the Rupee (or l/sth of the and when(munafac) (permonth. Akbar's 27th regnal year.often compounded(nominallyat least) at a particularshare of the produce. 6603. f. also membersof the well-knownIndiancommercialcaste of Banyas)to pay the land-revenue.. original version in an early draft of Akbarnama. Doc. see Durru-l cUlfim. Abu-l Fazl. and a referenceto intereston taqdvimade in Yasin's Glossary(latterhalf of the 18th century) probablyapplies to these loans. pledgingwith them the wives and childrenof their servants 17 The 16th-and 17th-century documents on which the statements in this paragraph are based. 123b."taccavi" and cattle. also placed them underthe necessity of havingrecourseto the usurer.'9 Medievalruralsociety contained. Ain-i Akbar?. f. The zamnnddrs its produce. they paid Rs 2 per bigha (measure of area. MS British Mus.Thereis no reference to interestbeingcharged.the peasantsobtainedtaqdvi. out of the treasuryto the giving". 43a. pp. Or. and pay the land-revenue This obligation. p.apartfrom other factors. 19 MS Brit.accordingto the Glossary. Allahabad. Mus. Bib. No. 185a. Sadiq Khan. a selection follows. 331b. 27. 1665) and Durru-l 'Ulim (A.D.besides the peasants. This content downloaded on Tue.17 own commissions It seems that such officials also advancedloans to the peasants out of their own resources. MS Bodleian.thoughit is possiblethatthe local officialstook their from the peasants. "strengthof modernAnglo-Indian usage). generallydue for repayment in the Mughal-period records or at the firsttwo harvests. Ind. 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions . Adab-i CAlamgirT. The loans were generally enable them to seeds to buy peasants local officialswho advancedthroughthe villageheadmenand otherhereditary stood surety for repaymentby the individualcultivators. "the Afghanshave borrowedlarge sums from the baqqals(grain-merchants. For a detailed treatment of the subject. Todar Mal's Memorandum. are too numerous to be cited in full. f. see Public Record Office. Farhang-i Kardani.or for each harvest?). of varyingsizes) of the field planted. MS Aligarh: Abdus Salam F. 54a. calledtaqdvi(lit. 35b. Add. 174.8l On such loans the borrowerswere presumablymade to pay interest. 253-55. MS Brit.a superiorclass to which contemporary terminologyfrom the 16th centuryonwardsgave the held rights of various types over land and name zcamndar. Blochmann. MS British Mus. f.USURY IN MEDIEVAL INDIA 397 revenueofficialsthat they oughtto advanceloans. f. Walker 104. They were usuallycalled upon to collect due on the lands over which they had such rights. 18 For taqadvadvanced to peasants by chaudhuris (chief local officials of a pargana).

serving in the Mughal expeditionary army in Rajasthan in 1680. A Muslim trooper or officer from the Panjab. He forthwith went to his commander to express his great anxiety about their protection. Tazkiratu-l Waqicat.pp. 23rd regnal year of Aurangzeb (Aligarh transcript. 711. Add. Mihtar Jauhar. taking over the zamindarls of their debtors when the latter failed to repay their debts. interest. A case on record suggests that considerable intimacy could spring up between the two. sold the corn and paid off the baqqals to secure the pledges' freedom. issued a farman (A. lOb. commission. p. 555). 16. must have been quite welcome to the latter. so that it may be assumed that the father had settled the village in the reign of Aurangzeb.23 Commercial Usury It thus seems that usury had deeply penetrated rural life..). Shahjahan. The enormous revenues of the ruling class and the drainage of a large part of the agricultural produce to the towns through the channels of commerce also helped to create and maintain a large non-agricultural population consisting of various classes such as artisans and labourers. 23 For the text of the farmdn see Proceedings Records Comof the IndianHistorical 21 20 mission(1942). declaring that "the mahajans of that place. Jauhar thereupon seized all the granaries of the Afghans. they were far more immersed in pure monetary relationships than the rural population. This content downloaded on Tue. there were mahajans who "offer to pay the land-revenue on behalf of the zam7ndar. enabling the zamindar to obtain money whenever the need arose. the penetration being impelled by the large magnitude of the land-revenue demand and the growth of the cash nexus. and the nobility and its hangers-on. 132a-b.D. petty traders and merchants. directing his officers to reassure and resettle the mahajans. Jumada I. except for their faith and religion [the mahajans being presumably Hindus] are one with us and are like brothers and relatives to us". Risala-i Zirdat. had been attacked and plundered by the zamdndars of three neighbouring villages. &c. of which he and his brothers were obviously the zamindars.22Similarly. The village was called Aurangpir Badal. 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions . f. they obtain great profit from the perquisites of revenue-farming. 22 Waqiiic-i Ajmer (official intelligencer's reports to the Court from Ajmer.20 Similarly. so that [since the Afghans had fled] there is no way for the latter to obtain their release"." Such mahajans were in fact often ambitious of becoming zamindars themselves. 56-7. the mahijan's presence. Till their time (of final accounting) comes. we find the holder of a land-revenue grant greatly interested in getting back to his village certain mahajans whom neighbouring zamdndars had driven away: On his petition the emperor. etc. heard that the mahajans of his village.398 IRFAN HABIB (zah-o-zad-i mawali). f.21 In normal circumstances. The name of the trooper's father was Badal. MS EdinburghNo. Naturally. in mid-18th century Bengal.MS British Mus. 144. 1653).

to weaversalmosteverywhere practiceof giving money beforehand at Surat. 149). p. 1661-64.25 vances made to artisans. for quotation from Hedges. p.only becausewe have so little information very often relatingto the social life of the commonartisan.Kabir. Diary. October 2. 159 (Sind).but this is. or artisans. p.The prices of the finishedproductstoo were fixed beforehand. sent his wife to the shop of a baqqalto beg for rice and ghi (Indian to whatevertermsthe baqqdlimposed. For the period being stipulated. p. p.Bengal and GolIn Bengal a technicalterm seems to have developedfor such adkunda. they leave us and work for him" (ibid. see Totle's report from Samana in 1626. 137. who will bring in their goods within ten days" (ibid. 208-9. 159).he committedhimselfto give priorityto the work orderedby the lender and to deliverhis cloth within the stipulatedperiod.the in India. 111-2. a weaverof Banaras.29 or in less than the marketprice. 296 & 1661-64. & 1646-50.v. and 1637-41. 112. saying that he "has distributedsome 4. 149 (Samana. to give. yet if any pedling cloth merchant comes to buy.namely.That he depended on credit for his subsistenceis shown by his readinessto accept terms unfavourableto himself from anyone who gave him a part of the price of his wares in advance. The only reference to interest is to the one charged by the broker from the English whenever he himself provided the money for disbursement among weavers.USURY IN MEDIEVAL INDIA 399 The story is told in a 17th-centurywork of how the famous religious teacher. 111-2. pp.usually received The advancesmight be made in cash. 290. while the broker took from the English 6 14 mahmudis per piece. the Dehli region. so that it may be assumed that the weavers. 29 Cf. DADNY (p. 1637-41. 26 Hobson-Jobson.The Englishin the 17th centuryfound. from the Persianword dadan. Dehli province).. setting out a detailed exposure of the irregularitiescommitted by the broker Somaji in the management of the loans advanced to the weavers on behalf of the English. 208-9 (Surat). 68-9 (Golkunda). 1655-60. 1683. This did not preventcertainother impositionsbeing levied on the artisan:The weaversat Suratworkingfor the Englishwere forced to pay 12% of the advances received by them to the broker who acted as middle-man. pp. 1661-64. When a weaver accepted money in advance. p. 62 (Bengal).submitting further of sheer directresortto the usurerbecause examplesare povertyany not available.. Dabistan-i Mazahib (Bombay). pp.as well as in Sind. This content downloaded on Tue. 28 The last three sentences are based on a long passage in the English Factories. pp. dadani.24 Of this butter)on credit.27 No interestappearsto have been charged.for example. 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions . p. 27 English Factories. the weavers bound themselves to supply the specified pieces at 5 % mahmudis (local coins of alloyed silver). 1661-64. notwithstanding wee give them mony aforehand (?) part of the yeare. A complaint is recorded from 1647 that the weavers at Nasrpur in Sind were "a company of base rogues. All the instances of the use of this word cited here come from Bengal.000 rupees to the weavers. perhaps.providedthe work was completed by the due date. pp. 1624-29. 1624-29. When accepting the advances. and followed. ibid.. 290). and that in the time of there greatest want. 1646-50. for.28 24 25 English Factories.findingnothingin his hovel to feed his guests.26 From referencesin Englishfactory recordsit is possible to determinethe customaryterms on which these advanceswere made. Hobson-Jobson. s. 159-60. p.

preservedin the Sikh scripture.the sah or sahu.i.except that the capital It may be (punfi) in the former case consists of God's name. 180-81. have his stock. constantly". sugar. more in line with the classic "putting-out" when system. At Suratit was found that the weaverswere paid not "in Money (i.because in that "the stock (mil) diminishes.e. 1655-60. p.but in leiw thereofin old wormeeaten decayedcome and pice (whichis a coppercoyne. to take up the work 1520) in one of his verses expresseshis unwillingness of the grain-carrier (banjara). however. 112. 22. and his sikhs (disciples)to that of the sahu and his banjaras.e. I. Such authority in the hands of the usurerwould seem to imply that it was difficult for the petty trader to obtain capital for financing his extremely and a completesubordination was requiredfrom him before he could trade. But at higherlevels in the commercial world merchants had referring to the payment of "dadny" (dadanl) in sikka or newly coined rupees. 33 Ibid. Thus Kabir (c. banjdras. shed an interesting betweenthe light on the relationship lending merchant.38 The petty traderappearsto have been no less dependenton the merchant than the artisan. p. they suppliedthe weaversnot with money but with raw material. or spiritualGuide. p. and the traders. 34 Ibid.and one whose dwelling palace confidence it is not easy for new bapar7sto gain. 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions . to a wandering community of traders who transportedgrain. the same teacher comparesthe relationshipof the Guru. 35 Ibid.bdpdrisor biiparis. salt and other goods of bulk. published by the Gurudwara Prabandhak Committee (Amritsar.32 Nanak asks the trader (banjara. The term banjara was generally applied.. at Qasimbazar.. silvermoney).. wound silk. I. and these were probablyover-ratedat that.i. 30 English Factories. in a and served by his millions of banjaras. the weavers purchased silk of bad quality and thus "those that trusted them (with money) were forc't to receave any taffetyes never so badd". pp. This content downloaded on Tue. the principaland intereston the loan being repaidout of the goods that the traderbroughtback. 1661-64.. It seems to have been usual for the saihi to make a loan to the traderto carry stock to other places.33 discriminating Arjan speaks of God as the greatsahu. 430.. (English Factories.34Elsewhere. pp.)". 31 The reason given for the step was that "being poore men". as in these verses of Kabir. 296). the word is apparentlyused for any trader and thus treated as a synonym of bapiir. 32 Guri Granth Sahib.30 The Englishin Bengal experimented with anotherstep. 1951).A numberof verses of the popularreligious money-lender teachersof the 15th and 16th centuries. 1194-5. the Gura GranthSahib.e.400 IRFAN HABIB kind. p.. I. not money. In the verses of Nanak and Arjan. while the interest (biaj) increases.35 markedthat the petty trader'ssubjection to the usurermust have been almost to God or to absolute.if it could thus be comparedto man's subservience the disciples'to the Gura. man) to buy such goods only as would be approvedby the sihu (God) beyond. Devanagari text.

ed. A. specialised in dealing in hundis. 1960). difficult to work out from the discount. pp. for drawing my attention to a number of references given in these tables. according to a mid-18th century historian of Gujarat. therefore. by which means they financed commerce to a considerable extent. I. The following tables set out part of this information. 37 Letters Received. however. Thanks to the published English records we are in possession of extensive information about how money was raised by merchants and the rates of interest which prevailed in Indian commercial centres during the 17th century. In 1617 we find the Surat factors rejecting a suggestion that as much as Rs 40. ed. 36 This content downloaded on Tue. 8-14. they were evidently not greatly trusted in the Indian markets. Tapan Raychaudhuri (Calcutta. The reference to the use of huni7lsin commercial payments is in 'Ali Muhammad Khan. Their subsequent records contain a considerable amount of information on their own transactions and on the rates generally prevalent. It was fully saleable so that a merchant or anyone else who had cash on hand for a short time. usually of two months or less. Professional bankers.38 For a detailed treatmentof the subject of this paragraph. V. but the poverty of the people. and they were able to borrow large amounts at rates far below 3%. in Contributionsto Indian Economic History.36 Issuing hundis was. One index of the existence of such a money market is provided by the wide use of the "indigenous" bills of exchange. 38 I should thank my friend and colleague. could invest it by discounting hundis. Qaisar.000 could be raised by them in India or anything obtained at a rate lower than 3 % per month. and the fear entertained by the people of tyrants who might seize their money if they knew they had some to lend. When the English first came to India. or "exchange". which completely refutes the earlier reports of the factors. pp. Mr. I. So brisk had the sales of hundis become that. pp. who "have not money to lay out". The discount charged on the bills covered not only interest. Nawab Ali (Baroda). 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions . It is.USURY IN MEDIEVAL INDIA 401 access to the services of a large money market where lending was purely for the sake of interest and did not involve any control over the operations of the borrower. 410-11. commercial payments were generally made in these bills and only seldom in cash. For this they gave as reasons. The hundi or hundw7 was a bill promising payment at a particular place after a specified period. which is taken entirely from the volumes of the English Factories in India. J. but also the cost of insurance and of the transmission of money. known as sarrafs. 86-7.37 But with the passage of time the credit of the English rose. the rates of interest paid on short-term commercial loans.see my article on "Banking in Mughal India". Mir?at-iAhmadi. only one of the ways by which merchants borrowed money. not their own lack of credit.

1651-54.a. F. lower rate not possible.) on deposits by English. 1622-23.) believed "usual between Banians" (belief contested by factors). 1634-36. 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions .D. F. Rate expected on Company's loan to "mer- chants of a cleare reputation". 222.) at which factors /2 % *|. F. F. Amount the Company authorisedSurat factors borrow. Letter of credit obtained by factors. 1655-60.000 books.000 mahmidis - % Private Englishman'sdebt. F. F.40 Fixation of interestin monthly rates seems to suggest that loans were generallyad39 Here and elsewhere amounts given in Pounds sterling are converted into Rupees at the rate of 2s. 1655-60. rest at mahmidis (over Rs 100.000) 1657 1659 - the other. 114. 1665-67. F. 174).824 %% 1/2 & 5/% hoped to borrow. F. English Factories. "Common interest" paid by merchants.000 1654 265. F. 86. Aligarh. 3d. Interest added to certain accounts in English 1635 1642 1650 Rs 20. 178.There can hardlybe any doubt that this was the generalpracticethroughout the medievalperiod.a. 1642-45. F. English able to borrow at these rates (quoted as 71/2 & 9% p. p. Current English debt. referring to a usurer. p. 209). %% % & /2 % 34 Borrowing expected to be possible at this rate. 40 The 14th-centurypoet Amir Khusrau of Dehli. F. quoted as 7 /2% p. part at one rate.) only.a. 163436. 86. 119. A. 199. 196.000)39 1651 L 20. 165 5-60. 158. 1655-60. F.a. 1642-45. F. except for certain rates quoted for the year (apparently for the convenienceof the Englishthemselves). 1651-54. the rates of interestare usuallyquotedfor the month. Loan raised by factors. Amount the English could raise. 5. 109-10. 1298-9. Rate (quoted as 6% p.402 IRFAN HABIB SURAT Year 1624 1634 Amount borrowed - Rate of interest per month 1% 1/8% Remarks and References 'Usual "bezar"(market)rate'. 144-5.g. Lowest rate prevailing. 1659 1659 63. 1651-54. F. 35.a. 1665-67. 33. This content downloaded on Tue. Rate (quoted as 6% p. speaks of his constant impatience to see the month pass to that he might claim his interest (Matla'u-l Anwar.. 196.000 (nearly Rs 180. F. 1646-50. Sarrafs said to be willing to pay this rate (quoted as 7/2% p. Rates at which factors believed able to borrow.000 1% 1 or 11/4% 1% L 20. which seems to have been accepted by the English Company at the time (e. /8 % 1665 1665 - 3 % /2 % F. It will be seen from these tables that.~~~~ ~~to 3/4% 1652 1652 /2% 1652 Rs 200. Rate quoted as 9% p. 1926.. 1651-54. 316. 1651-54.a.

350 pagodas.was not compounded. Rates at which sarrafs advanced loans. 1646-50. as calculated: 2.No referenceto compoundingoccurs in the English records. 163. 215. F. 1646-50. Rate on fresh English loans.the resulthas been obtained the monthlyintereston the principalby the number by simply multiplying of monthsin the period. Rate at which sarrifs accepted deposits. 239. 1651-54.000 pagodas. Loan against gold pledged with lender. 42 Principal: 10. the advice given by the Surat factors to the Company in 1652 that loans raised in India were "at times only for a month" (English Factories. it appearsthat they were generallya little higher than the Cf. Rate on English debt incurredpreviously. 112. 270. Total amount of interest. 213). 1624-29. F. 1637-41. 41 This content downloaded on Tue. Surat factors arrangefor credit at Ahmadabad at this rate. Rates on English borrowings.however. Reduced rate on English debt. Ibid. 1646-50. 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions . 1646-50.In fact. p. 122.000 Rs 12. 225. Ibid. period: 9. F.000 Rate of interest per month 3 % %% Remarks and References Loan raised by factors. Rate on English borrowings.000 Rs 8.and at one place wherethe total amountof interestdue on a given sum at a particular monthly rate for a period of over one year is calculated. Ibid.41Interest. F.42 In studyingthe rates given in the tables it may be borne in mind that the rates are mostly those at which the English factors borrowedon behalf of the Company. 1651-54. AGRA Year 1628 1645 1645 1645 1645 1645 1647 1654 Amount borrowed Rs 57.000 - above 1 /4% above %% /16% 1658 1658 Rs 24. 1655-60. 1642-45. Rates on English borrowings. F. 1624-29.1646 to 29. 128.These need not have representedthe rates prevalentin the market.vi. (English Factories. 1 to 21/2% 1% 3/4% %% %% 3/4% vanced for short terms only.000 Rs 21.F.iii. 1624-29. Ibid. No outsider willing to borrow at this rate from Company. Debt contracted by local factors. F. 302-3.1647 (= 153 months). rate: 1l/2% per month. Lower rate than this not allowed by lenders Rs 10. 86).F.000 - %3/% / % on English borrowings. 301-2.USURY IN MEDIEVAL INDIA AHMADABAD Amount Year borrowed 1628 1628 1640 1647 1647 403 Rate of interest per month 1% 1/2% Remarks and References Raised by factors.F. Ibid. p. F.

Thus the English seldom succeeded in securing the same rates as lenders as the ones they paid as borrowers. Ibid. SURAT 1665 and AGRA 1654 in the tables above. notably in Golkunda and on the Coromandel Coast.000 pagodas * 1636 Masulipatam 1645 Golkunda 1647 Raybag 1647 Golkunda 1648 Madras 1654 Coromandel Coast 1665 Madras 16. F. F. fluctuating between 1 and 112% per month. 155.45 It was stressed that owing to this difference. English debt. 1634-36.44 In England money could be borrowed at 4% per annum. F.000 pagodas 20. But in the Deccan. especially under Surat. Rate current.43The Company seems to have often entertained the suspicion that its factors overstated the rates at which they could borrow. F. 213. especially.200 pagodas 11/ % * Pagoda = 4 to 5 Rupees. We find the English factors in India repeatedly impressing upon their superiors in London the loss that the Company incurred by borrowing in India to finance its trade. this difference between rates prevailing in two parts of the country cannot be explained. They here paid "double the interest which is exacted in England" (1650). It appears from the tables that the rate of interest at Surat generally varied from Y2 to 1 % per month. 1655-60. 278. 1646-50. F. 158.1 if not 9% (1659).000 old pagodas - % 1. market rates.000 or 12. p. English debt.F. while at Surat the rate was 7. simply to be employed 43 44 45 For such cases see. the rates were distinctly higher. 1646-50. A matter requiring still greater attention is the difference that existed between interest rates in Europe and India. 140. English Factories 1646-50. 1635 Masulipatam 10. pp. 295. it would have been profitable for the Company to send money to India. For the moment. 308.404 IRFAN HABIB THE DECCAN Year Place Amount borrowed Rate of interest per month 2 & 21/2% & 3% 2%/2 1 /2% 1/s % 1 1/16 % 1%/% 11 Remarks and References English debt.720 great pagodas 10. This content downloaded on Tue. 112. 1665-67. F. 1646-50. 199. and this seems to have been broadly true of the rates at Ahmadabad and Agra as well. English debt. 1634-36. F. 1651-54. 104-5. Rate on English debt quoted as 13 /2% p. 1646-50. was due to the increasing watchfulness of the Company in this respect. quite possible that the progressive decline in the rates that one sees in the above tables. Lowest rate current. therefore. Rate quoted as 15% p.a. 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions .a. 222.000 rials 10. English factor's loan to broker. It is.

In 1645 at Agra alone they had a debt of Rs 80. For the voyage betweenSurat and Gambroonin the Persian Gulf. 116-17. 50 and 60 per cent.50 1660 the English Company'sdebt at Surat had gone up to L 70.000. 195. and in 1669 certainSuratmerchants were reportedto have taken up money at "avog"at "44. But it was probably never negligible. p. secured loans or loans advanced to merchants commanding confidence.. 52 Ibid. p. "for money at interest never faile of good securitye" (1660). 119.46 Besides ordinarycommercialcredit which we have been discussing. and 1668-69. Another passage shows that in "avog" the money borrowedwas laid out in cargo to be shippedto a particular place. the lendersbearingall risks of the voyage. from which our information on "avog" as given here is derived. 50 Ibid. p. p. 1637-41. are in English Factories. 214 n. 1655-60.49 and two yearslatera singlecreditorlent themRs 200.54 The biggestcreditor of the Englishat Suratwas Virji Vora. 1665-67. pp. they are said to have variedbetween 14 and 18% (1640). and would rather take up moneys to supply their owne. i668-69.000 By Rs over "a vast debt (= 600. p.53 If the Englishrecordsare any guide. 51 and in 1669 its factorsagaincontracted at interestto the amountof 600. who for nearlyforty years lent them Ibid. 54 That merchants supported the money market to a very large extent is suggested by statements such as the following (Surat. pp. p. The rates chargedin "avog"were naturallyhigh.the Companywas told. 19-20). there investment wherethe lenderbore considerable were also formsof speculative risks. 1637-41.e. obvious corruptions of an Indian name which it has not been possible so far to identify. 51 Ibid.52 At the same time the Dutch Companywas believed in 1639 to have raised as much as Rs 800.47 It is impossible.For this the ability of the English to finance their entire trade with India from money raised here.000. 48 English Factories.48In 1650 the Suratfactorswere sure they could raiseL 20. See also ibid. It is parenthetically explained at one place as being the same as bottomry ("bottomarie"). p. 1655-60. 1651-54."for a voyage to the Philippines. 46 47 This content downloaded on Tue. 235 n.000 (= Rs 180. 1646-50.to computethe amountof finance availablefor commercialtransactions at any time in medievalIndia. merchantsthemselvesby lendingto each other provideda large part of commercialcredit. 49 Ibid. 53 Ibid.of course. 202. (English Factories. pp.. for since Sevages [Sivaji's] robery of this towne [1664] those eminent merchants who were wont to furnish the Companyes occations are disabled.i. p.000 in India at the rates of 11 and 1 /2% per month.000) at any time they liked. 316. may be offered as a convincing testimony. 215. p.USURY IN MEDIEVAL INDIA 405 in usury:And "You need not feare bad debts". p. 1665): "Money is not now procurable at interest here. they are generally so disjointed in their credits and estates that they will not trust one the other". 302-3. 1634-36. as in former times. Thus we hear of a practice called in the English records "awg"or "avog". 193. 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions . The two basic passages. and 1665-67. 1655-60. 1642-45.000). 232 & n. 272.000 rupees".

184. ibid. see also pp.provided commercewith capital that was in part at least purely non-mercantile in origin. and explains that this was so 55 This content downloaded on Tue. p.000 old pagodas (= Rs 50. 158-9. 1668-69. Ind.ds. doe esteeme it safer investedin (such) sollid unperishable comoditysthoughthey get but 4 and 6 per cent. 1655-60. See also The Rehla of Ibn Battuta. 1655-60. defines "Multani" as the general name for a Hindu in Central Asia and Persia.55 or "sheroff". ibid. then eitherin cash or at interestor avog". 405-07. 18) and in 1647.58 As a rule.57 He did not usually to secureadvantage in his it him and another said of leading Surat employ capital usury..000 rials at Golkunda (English Factories. 60 Barani. Bib.who. 193). Bib. by them. 1642-45.). sums amounting to 2 million He advanced tankas to"wealthyMultanis".000 (English Factories. The sarrafstoo sometimesengagedin trading. 193. p.000). 58 Ibid. p. who having alwaysvast treasureready in house. p. at Surat). 1668-69. where it is said that "Virgee Vorah is the only master of it (money. and he is so close fisted that for the consideration of no interest cannot yet be procured of him". 159. p. 56 English Factories. 1646-50. and CAfif.but for them commercetook a second place to usury and banking.406 IRFAN HABIB Despite his very large sums of money.. he and his family together with other "sheroffs" lent to the English at Surat Rs 400. 108. 1668-69. Sultan'Ala'u-d Din Khalji(1296-1316) is said to have encouraged the flow of tradeby givingloans to merchants. 1634-36. 293-4.Ibn Battuta and 'Afif speak of merchants in general. suspendedbusiness. known as sarrafs ("shroffs"). Cf.v. 215. 114) and a little later offered them Rs 200. Where Barani speaks of "Multanis". The State occasionallyservedas yet anothersourceof commercial finance. p. The authoritative 18th-century dictionary. 308). Mahdi Husain. 57 Ibid. p. in 1669. Ind. 1655-60. 59 Miryat-iAhmadi. in 1645 he lent an amount equal to 20. Thereuponthe merchants.dis. pp. as we shall see. pp.In the 17th century A few examples of Virji Vora's money-dealings with the English may be provided. 41.headed in cash-payments theirturnby the nagar-seth (chief merchantof the city).The separation betweenthe merchants and commercial usurersis strikingly broughtout in the accountof an incident that took place at Ahmadabad in 1715. pp. again at Golkunda (ibid. p. and there was a threatof even armedclashes between the two sides. 10. Ta4rikh-iFiruz-shahl. 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions .who really specialisedin the provisionof commercialfinance. while merchants might invest the idle cash on theirhandsby lendingto othermerchants or discounting their hun.requiringthem "to bring commoditiesfrom various parts of the country and sell them at rates fixed by the Sultan"at Dehli.there was a separateclass of persons. tr. I.59 It is possible that the sarrafs. being merchantthat both of them were "prodigiousmoneyed men.6?0 Whetherhe demandedinterestis not recorded. 311. T?rrikh-iFiruz-shahl. Cf.. p. Bahdr-i 'Ajam (s. 216). p. 410-11. also ibid. accepted deposits. In 1635 he gave a letter of credit for Rs 20. often runninginto lacs of rupees. for himselfwhenbuyingtheirgoods.the Englishcomplained eminentlya merchant.56 he was prebeing occasionallydescribedas "money-lender" that he lent them only Indeed. p.. The sarrafsof that city had a leader of their own. at whose behest they raised the rate of anth or discount on made against hun. p.000 even at a time of commotion (ibid.000 (English Factories.

These persons derived their income from salaries sanctioned by the King. the expenses of the nobles kept pace with their income. "the merchants here pay it to the King's diwan [revenue and financial officer] in satisfaction of advances made by him". 1646-50. 193.USURY IN MEDIEVAL INDIA 407 we read of a large loan of half a million Rupees advanced at Shahjahan's orders from the imperial treasury to one "Munnodas Dunda" to enable him to purchase the entire supply of indigo in the Empire. With all their wealth. 1634-36. Indebtedness among the Ruling Class The medieval ruling classes consisted largely of men who were the King's servants.000. 101. pp. and as soon as the mint turned out any money. to the assignees. However. to the English against bullion deposited in the mint. and it seems to have been common for them to anticipate in their spending the actual collection of revenue. in particular the land-revenue. which could be made only at the time of the two harvests. In an account relating to the period of Sultan Ghiyasu-d Din Balban (1266-87). p. were alienated. 1637-41. 62 63 Ibid.64No reference to interest is made. Ibid. "Multani". Thus on the very morrow of the Turkish conquests. This content downloaded on Tue. the Governor of Surat extended a large loan.000 from the Surat mint and the Governor's treasury. p. Since the land-revenue itself accounted for the bulk of the surplus produce from the land. also p. the conquerors appear in the position of debtors to a class of their subjects. 64 Ibid.6t From the reign of the same Emperor comes other evidence of loans made from treasuries and mints to merchants. 61 English Factories. 324-25. 1630-33. 68. No interest as such seems to have been charged. for the period of assignment. together with Rs 600. who were in return granted a claim on the collections in the assignments. interest-free.000 or 30.63The English factor at Thatta (Sind) once complained that money was scarce there. we are told that because the Hindus settled there originally came from Multan. the resources at the command of the nobles must have been enormous. the Surat factors expected to borrow Rs 20. therefore. in lieu of which they were assigned territories. but it would be surprising if it was not charged. but the monopolist was required to repay the loan within three years. would therefore seem to mean a Hindu merchant. In one case.when used by Barani.62At another time. 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions . p. they were compelled to have recourse to the usurers. 72. of which he had been given the monopoly. Within the territorial assignment the King's taxes. in three equal instalments out of his profits. in autumn and spring. known in the earlier centuries as iqtd's and under the Mughals as jigirs.

299. money by issuing total debt he contractedis not known. p. gave them notes of hand in their own names. 67 English Factories. It is recordedin a despatchfrom Aurangzeb's courtthat when (in 1702) that Emperorsought 65 Barani. qualletieatt greaterates". p. It is not surprisingthat the professionalusurerswere very jealous of their right to interestin their dealingswith membersof the rulingclass.Santidas Sahufwas a big banker and jewel merchant. He is also referred to many times in the English Factories. MiPadt-i Ahmadl. "Satidas" in the Persian text is a misreading for "Santidas".000 extendedby Sha'istaKhan. or assignments.408 IRFAN HABIB "the Multanisand Sahs of Dehli. for them from out of the wealthof the old nobles and commanders the latter borrowedbeyond limit from the Multanisand Sahs. Nobles were perhapsnot averse to lendingto each other. This content downloaded on Tue. T&cr1kh-i Firuz-shahl.".. 302. of certainports and parganas(sub-districts) of Gujarat. and gave the creditorstheir due. 120. 1668-69. 1642-45. We are told incidentallyof a loan of Rs 300.71 This last transactionconfirms the general statementmade by the Agra factorsthat the rates on loans advancedto nobles were quite high. the governor of Hugli. enjoying considerable influence at Shahjahan'scourt. 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions . together with largesses. from (the revenues of) their iqtfas. (and) brought (the requisite things) to the majlis of that munificent noble".70 but the Shuja'. Ibid. 23 rd regnal year (Aligarh transcript. seems to have borrowed "bills of debt". 1651-54.66 debt from a when the a noble the of Englishattempted recovery Rajput larly. ZiqaCd. Barani adds that "whenevera grandee or noble held a majlis (convivial gathering) and invited great men as guests. 66 Waqaic-i Ajmer. half of it from the sons and brothers of Santidas Sahi and the rest from other for the repaymentof which he issued drafts on the revenues "merchants". 238-41. at 25% per annum.p. 71 68 69 Ibid. Governorof Bengal.67 personalattendance The Mughalnobles also appearto have inherited the habitof theirTurkish of borrowing predecessors "beyondlimit"and payingthe lendershandsomely for their service. The English factors noted in 1645 that the "sheroffs"at Agra were tempted "for lucre" to dispose of "greatsummes to persons of On the eve of the Warof Successionof 1658-59. etc. necessitating of the creditors'agent in the noble'sterritory. proceedingfrom come. and took loans on interest. 84. 177. pp.got of Dehli. 70 English Factories. p. his stewards rushed to the houses of the Multanis and Sahs.the mahajans Simigiven him somethingby way of a loan" and so alleviatedhis distress. p.1 million Rupees at Ahmadabad. to his subordinate. of Shahjahan. I. wouldhave deprivedof his jagirexplainedthat "hadhe a jagir.69 His elder brother." 65 In Mughaltimes too the nobles seem to have generallyborrowed An officer againstthe revenuesexpected from their jagirs.they obtained "writeings" for the repaymentof the debt in annualinstalmentsto be realised "in two equall portions and at the tymes when his yearely rents comes in. who becamepossessedof great riches. 413).68 Prince Muradraised as much as 1. p.

London..30 % 7. 46th regnal year (Royal Asiatic Society Library. it is possible to work out the annual rates of interest for each period of years (remembering.10% 7. that we are calculating on the basis of compound. and (then) the Governors too will extort (such) loans. According to Abui-l Fazl's official account. which bore the technical name of musi'adat (lit. I.25 % 6. 46/25).73 Akhbarat-i Darbar-i MuCalla. They represented that "if the Imperial Court takes (such) a loan.20% 6. 72 This content downloaded on Tue. holder of a territorial revenue-assignment) or a recipient of monthly (cash) salary" could apply for such a loan.72 The high rates of interest which the nobles had to pay to their private creditors seem to have suggested to Emperor Akbar (1556-1605) the desirability of advancing loans to his officials out of the imperial treasury. Since Abu-l Fazl has given us the total amounts repayable in terms of the principal after the passage of different numbers of years. It was not taken periodically but realised along with the principal at the time of repayment. pp. to enable him to pay the arrears of salary of his troops accompanying him in the Deccan.40 % 7. Blochmann. Alin-i Akbari. These rates are set out in the table below. 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions .70% 8. ed.USURY IN MEDIEVAL INDIA 409 an interest-free loan (quarg-i hasana) of half a million Rupees from the "sahiikars of the Imperial Camp".40% 7. Ratio of Amount due to Principal 17: 16 9: 8 5: 4 15: 10 15: 10 15: 10 171/2: 10 171/2: 10 171/2: 10 20: 10 Annual Rate of Interest 6. 196-7. Bib. "any iqtacdar (= jagirdar. the news will reach the provinces. Ind. The loans were not interest-free. however. but the interest was supposed to be on such a scale as to offer an example to "the unjust interestaugmenting ones". not simple. the usurers politely refused.00% 8. interest). favour.70% 10. Case 47.40 % Years completed 1 2 3 4 5 6 7 8 9 10 It was prescribed that no further enhancement be made in the amount demanded after it had become exactly double the principal at the end of the tenth year. which will mean the banishment of all sahas". Shawwal 16. 73 Abu-1 Fazl. assistance).

althoughAbu-l Fazl is silent on this point. 79 Waqd?ic-i Ajmer.p. 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions .appealedfor musacadat sible for him to borrowfrom mahajans in the absenceof a jagir. For two successiveyears. 670-71.became part of the mutdlaba. treasury) to umbrawes (umara'.75 Similarly. 67. 76 Waqrt1-iAjmer. also generallytheir employers. Ind. keep arguingwith Padshah Quli Khan (the Commander). concerning recovery of musaiadat from the jagirs of some Rajput officers serving in Kabul.. 67).p. II. expect that Mughal officers would generally have preferred to obtain musa'adatrather than borrow from private moneylenders. there is reason to believe that musa'adatwas not normally grantedunless certain special circumstancescould be urged.we can see some justice in the claim put forwardby Abi-l Fazl that his mastercould serve as a model for other usurers. Zi-qad.78 affectedthe recoveryof its advancesby despatchingagents to the debtors' jagirsto seize the amountsdue to it from the revenuesbeing collectedthere.Comparing these rateswith those prevailing in commercial usury. Shahjahan orderedmusa'adat to be grantedto each individualofficer participating in the campaigns. 23rd regnal year (Aligarh transcript. 21st regnal year (Aligarh transcript. Padshahnama. therefore. nobles) when they are imployed in any warr" (English Factories. so also the mutalabawas "repaidout of theire (the officials') From one specific instance. once advanced.makingan excuse of the distanceand low revenuesof their jagirs. 22).also provided a profitableclienteleto the usurers.79 The servantsand hangers-on of the nobility. or money-changers". Rajab. p."76 The amountof mustaadat. during the RajputWar of 1680. Bib.410 IRFAN HABIB Musa'adat thus seems to have cost the borrower between % and 34% per monthin interest. 1655-60.They were thus "obligedto borrow money from the sarrafs. p. who were said to have usually an with the officers about "the profit from interest which they understanding Waqfi-i Ajmer.74 Most often it was duringmilitaryexpeditionsand campaigns.and otheridlers. 507. 78 English Factories. cAbdu-lHamid Lahori. 413). duringthe War in Balkh and Badakhshan(1646-47). We may.when the nobles had to incur exceptionally large expenditureand naturally found it difficult to borrow from private sources. An official.equal in amount to one-fourth of the annual revenues of the borrower's jagr. 1655-60.77 Just as private creditorsobtained repaymentof their loans throughthe debtor'sdrafts on their jagirs. p. demanding musa'adat. 74 75 This content downloaded on Tue.However.Soldiersgenerallyfell into debt because who were they were not paid their salariesregularlyby their commanders. or the State's total claim against the officer concerned. 77 "The Kings mutalba which are moneyes lent out of the Kings cussana (khazana.23rd regnal year (Aligarh transcript. deprivedof his jagir and not on the groundthat it was not posassignedanother. pp. the official intelligencer reportedthat "mostof the jagirdars(posted with the army). Shacban. it appears that the Government jaggeers". 622). that large amountswere sanctionedfor disbursementas musaaadat.

174.An Indian dictionary. Irvine. In medieval India this caste-specialisation in usury. 'Bahar'. caste. True. I. 81 Shams Siraj CAfif. as a legitimateoccupation. 1886. the Brahmanas and and its assignment. jahez-glr.and India is no exception. 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions . at the rates of 50 per cent and 100 per cent.90. the State and membersof the nobility were not averse to lending at interest. 84 MatlaCu-l Anwar (Aligarh. W. T`rikh-i Firuz-shahl pp. Bahir-i CAjam. See also Fryer.professional remained the of who claimed usury occupation persons to be the descendantsof the ancientusurers.80 87) advancedmoney to his own troops duringa campaign.USURY IN MEDIEVAL INDIA 411 In an earliercenturySultan Firiz Tughluq(1351share between them". This separationof usury from other forms of exploitationoccurredearly in the historyof civilizedcountries. p. Buhler.or the Kshatriyas. 409) of similar substance the lenders are said to be "traders". 1672-81.not sarrafs.or from wealth acquiredin other departments life now channelled into usury. 379. 80 This content downloaded on Tue. but even then they were to lend to "sinful"persons only and charge low rates of interest.since usuriouscapital itself may not exist as a separateentity. 1926).throughout medieval times. IV. seems to have continuedin full strength.to the third. Brahmanas and Kshatriyas could resort to money-lending when in distress. as we have seen. inheritedfrom the ancient times. 220-21. Oxford.The separation finds its legal expressionin the ban on usuryimposedfor the highesttwo of the four Indian classical castes (varnas). pp.but we are not told whetherhe took interest.84 who lived on usury. Laws of Manu. 24. in another passage (ibid. II.In a primitiveagrarian the society two sources may be completelyintermixed. namely. 1. A ruralexploitermay claim a direct share in the produce of the land on the basis of a socially recognisedright and then extort from the cultivatoran additionalamounton accountof havinglent him seed and cattle.81 It appears that there were certain persons who financed gamblers. may be the mark of a certaineconomic developmentof society. 1700).compiled in 1739-40.A well organisedHindu caste Manucci (c..making theirgain exclusively from usuryand enlarging theirstock solely frominterest so gained. X. 341.83 Vaisya.like the usuriouskhwaja of Amir Khusrau.But by and large.and there must have been many Muslims. 82 Tek Chand s. 426).117 (tr. tr. p. A New Account of East India and Persia being Nine Years' Travels. defines jahezgzras a person who advanced"loansto gamblersin need of money. p.v.82 Usurers' Capital Capitalemployedin usurycould conceivablyoriginatein eitherof two ways: from gains made by the previousemploymentin usuryof the nucleusof the of economic presentcapital. (per transaction or per month?)". p. Storia do Mogor. 83 Manusmriti. The formationof a separate class of professionalusurers.

121. Ball. or banya) claiming to have deposited a sum in cash 85 The statements in the preceding two sentences are basedon Abiu-Fazl. diverse men have lost great somes and others totally undone therby. Another group within the "Banya" caste was formed by sarrafs (or "shroffs" of AngloIndian usage)..87A passage in a letter from the English factors at Agra. i. written in 1645. and that is their gaines. it is never applied to a Muslim. especially in the commercial world.86 It may be expected that with particular castes specialising in usury. speaks of "banyan money-changers.A'In-i Akbarl.). 123.or brokers (Travels in India. with the sarrafs in particular setting up as bankers. 1918).000] of rupees. "Banik"). Tavernier says that members of the caste of "the Banians" were either "shroffs. Bib. Zafar Hasan (Delhi. 1630. but also acted as money-lenders. and quite stifle his reputacion. II. "Banya" or "Banya" (from Sanskrit. Cf. Crooke.). 25. money-changersor bankers". 1640-67. tr. XVI. ed.. usurious capital should largely have been the result of self-generation.. s. the corrupt form "Banian"is used for the name of this caste.. writing in the later years of the 17th century.85 Members of this caste who engaged in usury were known as saihs. and was given in Indo-Persian the slightly confusing name of "Baqqal". considered the institution of deposit-banking to be one of the achievements of his country. London. sahukars and mahijans. The sheroffs they dispose of itt to others [at] from 1 to 2%/2 per cent. Thus we have evidence of deposit-banking in a rudimentary form. that was thought to be the same as the ancient Indian Vaisyas ("Bais"). 1925. He tells us that the sarrafs accepted deposits (amanat) from all. Hodivala. gives us an interesting glimpse of the system of "banking" of the period. 303. c. 2nd ed. 1642-45.Thus.. The historian. ?arrdf is a purely Arabic word. but in India. per month. 87 Khuldsatu-t Tawdr?kh. 1939). p. tr. pp. and Dabistdn-i Mazdhib (Bombay. 57. 125 & 160. Now when a sheroff (for lucre) hath disposedof great summesto personsof qualletieatt greate rates. an obvious misspelling of "Saraffes". p. who were in the strict meaning of the word money-changers. called here Paraffes". Blochmann. Those that are great monied men in the towne. and scrupulously paid them back on demand ('inda-t talab). Studies in Indo-Muslim History (Bombay.412 IRFAN HABIB was in existence. Moreland.. viz. Baqqdl had also the more limited meaning.v. n. however. We read of a baqqdl (grain-merchant. V. p. Ind. in Indo-Persian. II.which hath caused men of late to be verie timerous of putting their monies into sherroffs hands. one of which faileing for above three lack [300.p. hath two famous sheroffs bynn served within a moneth. pp.e. 143-144). not suddenly to be call'd in to serve his occasions. Journal of Indian History. 73. Sujan Rai. of grainmerchant.d. In the English and other European records. ed. and live onely uppon interest receive from the sheroffs [sarrafs] noe more than % per cent.88 These general statements are substantiated by specific instances. This content downloaded on Tue. although in Persia it meant a grocer or fruit-seller (Bahiir-i cAjam.ed. But it seems that in medieval times forms had already developed of the usurers' raising money from other strata of the population and so expanding their capital. 88 EnglishFactories. 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions . 672. then beginn his creditours(as in other partes of the world) like sheepe one to runn over the neck of another. It bore a different name. whether in Persian records or in English. running some hazzard for the same. the names persisting till today. p. and so limited in size. 86 Van Twist.

27).and they had to establish.hastenedon his accessionto assure"all the merchantsand mahajans(professional and the residentsand money-lenders) of our justice and good treatmentof (our) subinhabitants(of Ahmadabad) And. 1655-60.92 and profit for themselves". 92 Waq&aic-i Ajmer. 89 Waq&ic-i Ajmer. 21st regnal year (Aligarh transcript. op. usury in absoluteterms. his governorstoo might refuse to pay them interest. When the English factors suggestedto the Company that a debt be recoveredby applying"to the justice of the country". 94 Akhbarat-i Darbar-i MuCalla. 1634-36. of wealth society to commerce. This at first because the medievalkings of India were all may appearsurprising Islam forbids and Muslims. p. the medieval State extended its full protection to the creditor. p. Rajab. factors at Suratreportedto the Companythat the sarrafswould allow them interest at 71/?%per annum on cash deposited with them.through a channel for the diversionof part of the non-mercantile deposit-banking. 93 Mir'at-i Ahmadl. which refers to the Company's order forbidding the factors from keeping their cash outside their factories. I. in itself a very significantfact. p. Rajab. 29-30). howtotal capital. Here unwritten customs. when his orthodoxyhad become almost jects". It implies that commodityproduction had become so extensivethat the usurers'own resourcesno longer sufficed to meet the demandfor creditit created. seem to have been followed.93 at fanatical. 199. 240. This content downloaded on Tue. The State and Usury Usury flourishedin medievalIndia with the full sanctionof the State.ratherthanthe jurists'codes of Muslimlaw.90 Subsequently.94 In fact. deposit-banking ever.91The interest which the usurersallowedon these depositseven temptedofficials to invest funds of the Governmenttreasurywith them.they went on to explainthat "mostof our dealingsin these partsare done by word 90 This appearsfrom English Factories. in that case. even in his last years. 91 Ibid.Aurangzeb.USURY IN MEDIEVAL INDIA 413 and kind with two mahajansin a locality of Rajasthan. It is unfortunately impossibleto estimate either the amount of deposits or the proportionwhich these depositsbore to their with the usurers placed That existed in some form or anotheris.p.he acceptedwith equanimitythe refusal of the money-lenders his court to lend to him withoutintereston the explicit groundthat. pp. 169. An intelligencer's report of accuses a revenue-assessor and collector (amin) (karor) Aurangzeb'sreign in the Ajmer province"of conspiringwith the treasurer(fotadar)to deposit for (long) periodsat interest the cash collected(by them) with the mahajans and of ignoringthe treasuryaltogether. 21st regnal year (Aligarh transcript. cit.89 The Englishin the the beginningseem to have kept all their cash with sarrafs.Yet the most orthodox of medievalrulers. 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions .

98 The suit was preferred before the Emperor through the Qazi and Mir 'Adl (minister concerned with justice) at the Court. 265. p. Ultimately the suitor confessed to forgery and was punished for it (Jahangirnama. We two but cited. examples may ernors) of Ajmer trying a suit for the return of deposits kept with some mahajans: they both gave judgments partly in favour of the suitor and took steps to enforce recovery. "before the Nabob (Nawwab.99 There is no reference anywhere either to the inclusion or exclusion of interest in or from what the State regarded as rightfully due to the creditor. p. the matter was referred by the Emperor to Asaf Khan. 75. 97 English Factories. 43a. As a rule the wheels of government did not move until well oiled by bribery. always come away unscathed once he was obliged to appeal to the administration.414 IRFAN HABIB of mouth.100 The creditor did not. immediately after his accession. 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions . Rajab. find two successive faujdars (Govsuffice.97Such disputes could actually go up to the Imperial Court. 96 Waqiic-i Ajmer. 1634-36. the exclusion would not have had much significance. 29-30). p. 1651-54. 306). who thus circumvent the various provisions of the law designed to protect the debtor. a leading noble at the Court. 100 This is a common practice with the Indian professional money-lenders today. In the reign of Shahjahan. But on being told by his intimate secretary. to repay the debt his father owed them (English Factories. In practice. 177. to force the debtors to pay. 270. is said to have forbidden this 95 English Factories. certain local merchants who had purchased bad "bills of debt" from an Englishman. Walker 104. in any case. Rao Satrsal Hada. since the careful lender could always compel the debtor to attest in writing to a larger amount than had actually been lent. whereas in The claims for recovery of debts were usually England our law is intricate". Syud Ahmud. 99 See. ff. p. for example. p. Thus in the actual process of deciding the case the Sharicatwas disregarded.98 The texts of several imperial orders issued on petitions for recovery of debts submitted to the imperial Court have been preserved. it seems to have been a commonpracticewith Mughalofficialsto claim a fourth part of the debt which they recovered on behalf of any suitor. 84). 1655-60. & 54b. Shahjahangranted the English a farman directing his noble. "cited" the English factor at Patna. that the Saiyids were very emphatic in denying the claims against them. 47a. if they found them to be true.pp. judges. and is good amongst the people. 21st regnal year (Aligarh transcript. ed. At first Jhahangir ordered that they should follow the Sharicat (Muslim Law) in deciding the case.95 officials of the administration.000 claimed from certain Saiyids of Lahor. Ally Gurh. however. by whose sentence he was forced to pay the money". MuctamadKhan. 101 English Factories. MS Bodleian.101 Aurangzeb. 1665-67. This content downloaded on Tue. who was to enquire into the truth of the claims. Durru-l cUlum. without any writings. These are usually addressed to the local officials.96Similarly. p. Governor) of Pattana. Emperor Jahangir (1605-27) records in his Memoirs his trial of a suit for Rs 80. 1864. at any rate. and not before before the secular preferred to such suits are too numerous to be References Muslim the qazis. directing them to investigate the complaints of the petitioners and. 1668-69.

English Factories. Mi?at-i Ahmadi. f.106 In this atmosphere of corruption. fix the prices of the children and seize them. 265-6. I.. unceremoniously tore them up and turned the petitioners out of court. 94b. 88. 16... I. because the English had kept "good correspondence" (which implied gifts and presents) with him. MS Brit. f. An English factor at Ahmadabad reported that it was not possible to recover debts from certain persons who were "exceeding poore".110 Aurangzeb did in fact declare this practice to be illegal. that "Hindus and Muslims. when enforcing the recovery of a debt from which they stood to gain.103 That the Emperor's bans and prohibitions were far from effective is shown by the need he felt to forbid afresh the officials' custom of taking a fourth of the recovered In 1668 we find a reference to an English debts.108 At the same time. if the debts are not paid". 160. This content downloaded on Tue. Bib. who advance loans to some persons. Officials themselves. 166567. 94a. and take and keep their (the debtors') children as security for the loans. When the creditors of an English factor. enjoyed hardly any protection. the hands of the officials could. what actually happened was that Aurangzeb's finance minister. as if the imperial orders had not been heard of. pp. Tazkiratu-l WaqiCat. 109 Mihtar Jauhar. nearly fifteen years later.104 factor promising to the Governor of a town a third of the debt he was seeking to recover. p. Ibid. 10 MS Bodl. 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions . be stayed by rich and powerful debtors. 108 MS Bodl.109 A clause in Aurangzeb's regulations describes it as a practice then current.105The same tacit defiance appears to have prevailed at the imperial Court itself. 102 103 104 105 106 107 Khafi Khan. We may recall from Jauhar's reference to loans contracted by Afghans in the Panjab. petitioned the Court for the recovery of their debt from the English Company. or a promise to the partie that procures it. Ibid. Add. but how far his prohibition was effective is difficult to judge. 711. When the above-mentioned petitions were submitted to the imperial Court. p. the debtor. who died in 1665.102The actual text of his order prohibits officials from making any gain whatsoever out of recovering debts. Fraser 86. that human pledges were not regarded as illegal. p.USURY IN MEDIEVAL INDIA 415 practice in express terms.l07 A clause in Aurangzeb's regulations had to warn officials against taking the side of "merchants and others who show negligence in repaying their debts". Ibid. Jafar Khan. Muntakhabu-l Lulab. Fraser 86. 132a-b. if he was poor. 165. although their fate might arouse the compassion of even a revenue-collector. and. f. p. conversely.. 1668-69. did not spare the person of members of the debtor's family. the halfe or a quarter of the award (a usuall practice for the getting in of desperate debts)". Ind. it was expected by the latter's servants that "what verdict they shall get upon us by the Kings order must be by bribes. 287. 251. Mus. p.

II. 280 & n. 112 114 113 Abu-1 Fazl. 1655-60. pp. 75.On loans securedagainstpledges. Paymentof interestby the monthis one example. Hinduism and Islam. and the creditor could not claim in repaymentan amountmore than double the principal. between which there was hardly any direct markedin the was particularly of ideas. p. These are very accurately summarised in ibid. ed.and then closed..but in other cases. The prohibitionagainstthe repayableamountexceedingthe principaltwice over seems to have been paid heed to by Akbar.at least.l13His Court indeed seems to have been well familiarwith the relevantprovisionsof the Hindu law on usury. pp. the Quranicprohibitionof riba (usury)is so firm and explicit 111 English Factories. since the jurists of both Hinduism and Islam had separately developed. Certainlimits were imposed on the rates of interest. The ancient Indian (or "Hindu")law permittedusury. the rate of 114% per monthwas sanctioned. A'in-i Akbari.112 Certainelementsin these rules appearto agreewith the actualcustomand practicein medievaltimes. I. 148-9. 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions . This content downloaded on Tue.. But here we should better speak of the persistenceof a whole body of custom that was itself one of the sourcesof Hindu law ratherthan its product. In contrast.recommendedthat a fourth part of the debt be offered to the for "thenthe Catwall(kotwal. Buhler as Laws of Manu (Oxford.On the questionof usurythe two religionsadopt positionswhich are impossibleto reconcile.14It could in usury is a be arguedthat the very fact of the banya caste's specialisation tribute to the persistentinfluence of the Hindu legal system. according. pp.Compoundinterest was forbidden. out of the sides of them or sell their howse.head of the city police) will tare it Governor. progressivelyhigher rates were authorised. the rates of interestcurrentin medievaltimes fall generallywithin Similarly. their codes of law long before the beginningof the Indianmedievalperiod.when laying down the scale of repayment of musd'adat.11 Religion and Usury MedievalIndian society containedwithin its fold two independentreligious systems.Whateverthe originalpracticein the Arabianpeninsulathat provokedit. althoughno one in those times would have thought of varying his rate of interest accordingto the caste of the borrower. the limits prescribedby Hindu law. This separation intercommunication field of law. Manusmriti. compoundinterestwas not charged.the Islamiclaw on usuryhad in its originno connexionwhatsoever with Indiancustom and practice.with which it provedto be at complete variance. Blochmann.416 IRFAN HABIB therefore. 1886). tr. with a maximumof 5% per month. 196-7. but restrictedits professionto the Vaisya caste. 278 & n.inversely. wife and children to pay it".In commercial usury.to the caste of the borrower.

and pronouncesit completely "unlawfuland sinful".v. But Waliullah peoplewouldtend to abandonagriculture cannotbring himself to prescribethe complete. 174. Habib and Afsar Begam as The Political Theory of the Delhi Sultanate. Finally. s. Ind. M.in India at any rate. 251. since it is an unproductive way of increasingone's wealth. 116 Cf. In what is surely a very tame end to his argument. 256.. or the law-enforcingauthority. 117 Matlacu-lAnwar (Aligarh).'18 the while tion. first ed.the poor cannot pay in time. p.unconditional eradicationof the evil. 119 Fatawa-i Jahanddrl. pp.115 It was obviouslyimpossiblefor such an absoluteprohibitionof usury to be enforcedin societieswith more or less developedmercantile economies. on the other. 343. and prefacesthe statement as legitimate".writingin 1298-99. and craftsaltogether. 34-38. there is a generalhostilitytowardsit. p. Schacht in Encyclopaedia of Islam.119 This duality in attitudeis found even in the treatmentof usury by an orthodox theologian like Shah Waliullah of Dehli (1703-62). month.Islamicjuristsare unanimousin condemning usury in all shape in discovering and form. Amir Khusrau. Arabic text with Urdu translation of 'Abdu-l Haq Ijaqqani This content downloaded on Tue. Zia'u-d Din Barani.. deprecates wealth in that it provides "to the greedy and unmanlyones the means of Yet in his counselsfor good administraengagingin usuryand engrossing". on interest. J. also his Origins of MuhammadanJurisprudence(Oxford. to a Muslimfinancier by references to A (khwaija). two distinct strandsare found in the attitudetowardsusury. based on the law of the faith. moreover.he decides to leave to the shari'. the historian. 1957). and not merely excessive gain. and have shown no little ingenuityand earnestness and forbiddingusuriousgain lying behind what apparentlyare simple acts of exchange.116 Thereforein the Islamic ethical tradition. Usury also leads to disputes and conflicts among the people.On the one hand. p. they become subject to an increasingburden. there is a reluctantrecognitionof its unavoidability.and so the contractbetweenhim and the lenderis not voluntary. 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions . Thus the famous IndoPersianpoet. Bib. Social Structure of Islam (Cambridge. without shame. then. Since. to justifythe prohibition harshterms. recommending prohibitionof engrossing. 1950). R.he ignores usury altogether. p. and. or "limitsshould be set within which they may be permitted". He then seeks A poor debtoris forcedto accept on severalgrounds.the freedom to choose whetherusuryand gamblingshouldbe forbiddenaltogether. ribd.tr.USURY IN MEDIEVAL INDIA 417 that it logically covers all gain.'20 115 Cf. He repeats first the legal view that riba means the takingof any gain from any kind of loan. if it became more widely prevalent. says Waliullah a little naively. underany circumstances.117 living from month contemporaryof the poet. Levy. declaresthat "in no reliis the gain of the usurerand gamblerregarded gion. 118 Tiarlkh-i Firuz-shahl. obtainedby the creditor. 120 Iujjatullah il-Baligha.

collectors of tolls. 793. 123 Guru Granth Sahib.).pp. Nanak and others. even menial. 1194-5.Nagari PrachariniSabha. Vik.p. and a denial. 126 For the peasant character of the Sikh community. ascribed to Kabir. Muhammad Latif & MiCraj Muhammad (Karachi.418 IRFAN HABIB Of great interest is the position of usury in the moral conceptions of the popular religious teachers of the 15th and 16th centuries. was a weaver. Many of them came from 'he class of artisans and from other low. Their beliefs were simple: an unalloyed monotheism. 333.124 It is therefore probably not accidental that the Principles or Commandments accepted today among Kabir's followers do not contain a prohibition of usury. castes. see my Agrarian System of 122 Cf. 125 Cf. using the non-literary popular dialects of the time. Kashi. His verses give us. An exact parallel to Kabir's acceptance of the usurer's claim on the debtor as being based on natural justice and so analogous to God's on man. Rev. in the form of allegories. my Agrarian Systemof MughalIndia. S. represented by Kabir. The teachers addressed themselves to the masses. the fifth Guru of Sikhism: (in parallel columns). Nagari text. appear to be later fabrications. Numerous other compilations. edited by Shyamsundardas under the title. MughalIndia. a rejection of all ritual. On the contrary. II. Kabir. 310. pp.d. II. pp. of the caste system. collector of land-revenue. and you waste it all. The teachings of these men were derived in part from conventional Hinduism and Islam and were. in still larger part. This content downloaded on Tue. a haunting picture of the misery of the medieval poor. 317-18. as its editor believed). 42. Ahmad Shah. the capital (punji) belongs to the Sah. including his Bijak. an assertion of the spiritual unity of man.125 In Sikhism. 44-45. Kabir Granthavali. 344-45. therefore. 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions .122There are wails of complaint against the oppressive shiqqdar. and jagatis. 124 Kabir Granthavali. and in a MS of the 17th or 18th century (not the 16th. the Sikh scripturecompiled in 1604. is found in the following verses of Arjan.126we find evidence of the same attitude towards usury. Kabir seems to regard the usurer's claim on his debtor as so natural that he does not hesitate to justify God's claim on man on the ground that God is a usurer who has lent man his life: Kabir. directed against both. 2008. The Bijak of Kabir (translated into English) (Hamirpur. Vol.121 In many ways one would expect them to have mirrored the feelings of the poor. the most prominent of these teachers.123But there is never a hostile reference to the usurer. the religion of the Panjab peasantry founded by Nanak. 121 The most authentic verses of Kabir are preserved in the Gura Granth Sahib. p. pp. ed. There will be great difficulty (for you) at the time you have to give your account. 1917). n.

Nagari text. pp. (But) when the Sahu takes back some of the amount He has entrustedhim with (aman). Hindustani MSS. Similarly.we must believe that the everydaylife of the masses had been deeply permeatedwith it. lowly artisans and petty traders. No. 127 128 This content downloaded on Tue. p.128 This tolerant attitudetowardsusury in what we may well designatethe Poor Man's Religion of medieval India is of no little significancefor our study of its prevalencein the society of the time.could usuryhave been evil. fraud. 343-44. but as a necessaryelement regardedby the poor not as a superfluous in the whole productiveprocess by which they lived. The Satnami scripture is contained in Pothl Gyan Banl Sadh Satnamt.USURY IN MEDIEVAL INDIA 419 The Sahu gives countless (capital) of his own to man. Its members were generally peasants. I. etc. begging. drinks and uses it with pleasureand joy. (Man) eats.127 of the Satnamicommunity. London. and a large numberof artisansfor their raw material. IRFAN HABIB Aligarh Muslim University. The Satnami sect arose in the 17th century. See my Agrarian System of Mughal India.usury is not forbiddenin the scripture which is otherwisefull of scorn and contempttowardswealth. 1. 12 Mar 2013 08:03:49 AM All use subject to JSTOR Terms and Conditions . And only when a very large numberof peasantsdependedon the usurerfor their seed and cattle.India Gura Granth Sahib. and contains many exhortationsagainst theft. If those who addressed themselvesto the poor could assumethat to their hearersusury was one of the most naturalof institutions. 268. harassmentof the poor. The fool becomes angry. Library of the Royal Asiatic Society.