Sunday, 19 April 2020

THE INDIAN CURRENCY SYSTEM FOR COMPETITIVE EXAMINATION

TOPICS 
A)HISTORICAL BACKGROUND
B)ECONOMIC TERMS
C)RBI & GOVERNMENT ROLE to ISSUEING  CURRENCY.
D)PRINTING  & MINTING PLACE
E)SYMBOL OF INDIAN RUPEE
F)IMPORTANT MCQ.



                  HISTORICAL BACKGROUND


🔴Indo-greeks were the first to issue coins attributable to the king and also the first to issue gold coins in india.


🔴rupee coin was first minted in india during the rule of sher shah suri (silver coin)in 1542 AD.


🔴the decimal  currency system was started in india from 1st april 1957.


🔴the first one paisa coin under the decimal system was issued in march 1962.


🔴the first one rupee  coin under the decimal system was issued in july 1962.


🔴china was the first country to introduced paper currency.


🔴paper currency in india was first started in the year 1862 by the british government.


🔴in british era, private banks such as the bank of bengal, the bank of bombay, the bank of madras  printed first paper money until 1861.


🔴paper currency act of 1861➡️act gives right to the government to the monopoly to print currency.


🔴the government of india printed currency till 1935.


🔴RBI was established in 1935, after that RBI took the responsibility of printing money.


🔴the ₹5  note was the first paper currency issued by RBI in january 1938.
    ▪️it had the portrait of George vi
    ▪️within the same year currency notes of Rs10 Rs 100, Rs 1000, Rs1000 were issued.


🔴pulp containing cotton and balsan material is used for making for indian currency.




                     ECONOMIC  TERMS 


🔴what is DEVALUATION ?

➡️devaluation means lowering of the value of one currency in comparison of some foreign currency.

      Suppose before, 1 US dollar = 40 indian rupee
                         Now,  1 US dollar = 76 indian rupee
That's means the value of currency has dropped in india.


◾️in india, devaluation has been resorted to 4times

 💠FIRST DEVALUATION : in june 1949(by 30.5%)
      Finance Minister :Dr.john Mathai.

💠SECOND DEVALUATION :in june 1966(by 57%)
    Finance minister : sachindra chaudhry

💠Third DEVALUATION : on july1, 1991(by 9%)
      Finance Minister :Dr.Manmohan singh.

💠Fourth DEVALUATION : on july 3,1991(by 11%)
      Finance Minister :Dr. Manmohan singh.



🔴what is DEMONETIZATION of currency?

➡️Demonetization of currency means discontinuity of the particular currency from circulation and replacing it with a new currency.
   
◾️reason behind the Demonetization


➡️there are multiple reasons why a country demonetizes its currency, some reasons include
to check the inflation, to curb the corruption and to promote cashless transaction.

◾️NO OF TIMES DEMONETIZED

💠₹1000 & ₹500 currency notes were demonetized on november 8, 2016.

💠in 1946 ₹1000 & ₹ 10000 notes were banned.

💠in 1978₹1000, ₹10000 &₹5000 banknotes were demonetized.


🔴there are now only three monetary aggregates, viz M1, M2,  M3

◾️M1: coins and notes + demand deposits +other deposits with RBI.

◾️M2 : M1 + time liabilities portion of saving deposits with bank + certificates of deposits issued by banks + terms deposits maturing within a year.

◾️M3 : M2 + terms deposit with banks with maturity over 1 year + call/ term borrowing of the banking system.





RBI & GOVERNMENT  ROLE  TO  ISSUEING CURRENCY 


🔴according to RBI act 1934, section 22, RBI has the sole right to issue bank notes of all denominations.


🔴the present currency system is based on minimum reserve system of note issue.

  ◾️it was adopted in1957.

  ◾️under the minimum reserve system ₹ 200 crore (gold should be ₹ 115 crore and the balance in rupee securities is maintained ).



🔴RBI is responsible for the design, production &management of the currency of india, with the goal of ensuring an adequate supply of clean & genuine notes.


🔴Banknotes above one rupee signed by RBI GOVERNOR.


🔴the responsibility for coinage vests with the Government of India on the basis of the coinage act 2011

   ◾️RBI acts as an agent of Government which merely distributes the coins in the market.

   ◾️one rupee bank note or coin signed by FINANCE SECRETARY.




               PRINTING & MINTING PLACE



🔴coins are minted at four place  viz Mumbai, kolkata, Hyderabad, Noida.


🔴Notes are printed at 4printing presses, located at ➡️Nashik, Dewas, Mysore, salboni.


     ◾️first printing press for bank notes in india was established at Nashik(1928).
     ◾️second  printing press for bank notes in india was established at Dewas(1974).




                      Symbol of indian rupee 



on 5 march 2009,  indian government announced a contest to create a sign for the indian rupee.


🔴the final selected symbol was designed by D UDAYA KUMAR, a post graduate of IIT Bombay.


🔴the symbol of indian rupee came into vaguron july 15 2010.


🔴the indian rupee symbol is based on both roman script and Devanagari script.




                           IMPORTANT MCQ


🔴in how many languages, the amount of a banknotes is written on it ➡️17 language.


🔴the star series notes are currently issued in ₹5, ₹10, ₹20, ₹50, ₹100.


🔴on which denomination notes, the portrait of parliament house been printed ➡️₹50.


🔴when did india become a member of International Monetary Fund (IMF).➡️1947.









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