Which of the following phrases defines the nature of the 'Hundi' generally referred to in the sources of the post-Harsha period?
Answer & explanation
Answer: (c) A bill of exchange
A hundi was a written instrument of credit and exchange — a bill of exchange — that let merchants transfer money and trade over long distances without carrying cash. References to hundika appear in post-Harsha texts such as the Lekhapaddhati.
- ✓ (c) The hundi was a written order to pay a named person, used by merchants as a bill of exchange and credit note across regions.
- ✗ (a) Royal orders to officials were issued as edicts or grants recorded in inscriptions and copper plates, not as hundis.
- ✗ (d) The hundi was a commercial instrument used by traders and bankers, not a command in the feudal chain of authority.
Remember · Hundi = indigenous bill of exchange/credit note used by merchants for long-distance trade and remittance without moving cash.
📘 Read it in NCERT: Class 12 Indian Society, Ch 4 (practise this chapter) · Class 8 Exploring Society: India and Beyond (Part 1), Ch 2 (practise this chapter)
Sources
- NCERT Class 12 · Indian Society, Chapter 4 “an important instrument of exchange and credit was the hundi, or bill of exchange (like a credit note), which allowed merchants to engage in long-distance trade.”
- NCERT Class 8 · Exploring Society: India and Beyond (Part 1), Chapter 2 “A hundi was a written instruction to make payment to an individual.”
Question and answer: UPSC's official GS Paper I (2020, Series A) — paper ↗ · answer key ↗. Explanation: Minimalist IAS, checked 30 Sept 2026 (how we verify). ·