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INDIAN CURRENCY
PART- II
We would like to express our heartiest gratitude to our ITP Mentor, Mr. Suhail Anwar sir
for constant support and guidance, without whom the project would have been an
impossible task.
We would also like to thank the faculties of all the subjects for their guidance without
whose classes and lectures, it would have been impossible to understand the micro
level of the subjects.
Mr. Balbir sir was excellent with their ELEMENTS OF DESIGN. Mr.Abid Bilal sir was
perfect in their stuff in GEOMETRY. We had great knowledge base in our GENERAL
SCIENCE with Mr. Anand Prakash sir, Mr. Sehagal sir & Miss Shilpika mam. Mr. Bala
Siddhaarth sir was very much easily understandable with the complex terms in
MATERIAL SCIENCE. Mr. Suhail Anwar sir was up to the mark with the commands of
COMPUTER APPLICATION. We had a great experience of practicality in the study with
Mrs Bhavana K. Verma mam in BUSINESS COMMUNICATION & ENVIRONMENTAL
STUDIES.Ms. Archana mam was like a microscope with her refined ideas and
experiences of the textile industry, we looked the industry through her eyes in
OVERVIEW OF FASHION INDUSTRY.
We would also like to thank our course co-coordinator, Mrs. Suruchi Mittar and batch
incharge Miss Tulika mam for their assistance and support in all the fields of the project.
At last we would like to thank our classmates and friends for their encouragement and
co-operation.
………………………….
(RAHUL RANJAN)
…………………………….
(SUNIL KUMAR)
2
CONTENTS
• INTRODUCTION 4-5
• BIBLOGRAPHY 42
INDIAN CURRENCY
INTRODUCTION
A currency is a unit of exchange, facilitating the transfer of goods and services. It is a
form of money, where money is defined as a medium of exchange (rather than e.g. a
store of value). A currency zone is a country or region in which a specific currency is
the dominant medium of exchange. To facilitate trade between currency zones, there
are exchange rates i.e. prices at which currencies can be exchanged against each
other. Currencies can be classified as either floating currencies or fixed currencies
based on their exchange rate regime.
In most cases, each country has monopoly control over its own currency. Member
countries of the European Monetary Union are a notable exception to this rule, as they
have ceded control of monetary policy to the European Central Bank.In cases where a
country does have control of its own currency, that control is exercised either by a
Central Bank or by a Ministry of Finance. In either case, the institution that has control
of monetary policy is referred to as the monetary authority. Monetary authorities have
varying degrees of autonomy from the governments that create them. In the United
States, the Federal Reserve operates with full independence from the
government..Several countries can use the same name, each for their own currency
(e.g. Canadian dollars and US dollars), several countries can use the same currency
(e.g. the euro), or a country can declare the currency of another country to be legal
tender. For example, Panama and El Salvador have declared US currency to be legal
tender, and from 1791-1857, spanish silver coins were legal tender in the United States.
India has its currency as rupee which is a floating currency and used here only. As it is a
floating currency it has its vibrational value with respect to other fixed currency.
The Indian currency is called the Indian National Rupee (INR) and the coins are called
paise. One Rupee consists of 100 paise.
At present, notes in India are issued in the denomination of Rs.5, Rs.10, Rs.20, Rs.50,
Rs.100, Rs.500 and Rs.1000. These notes are called bank notes as they are issued by
the Reserve Bank of India (Reserve Bank). The printing of notes in the denominations
of Re.1 and Rs.2 has been discontinued as these denominations have been coinised.
However, such notes issued earlier are still in circulation. The printing of notes in the
denomination of Rs.5 had also been discontinued; however, it has been decided to
reintroduce these notes so as to meet the gap between the demand and supply of coins
in this denomination. Coins in India are available in denominations of 10 paise, 20
paise, 25 paise, 50 paise, one rupee, two rupees and five rupees. Coins up to 50 paise
are called 'small coins' and coins of Rupee one and above are called 'Rupee Coins’.
The Reserve Bank can also issue notes in the denominations of one thousand rupees,
five thousand rupees and ten thousand rupees, or any other denomination that the
Central Government may specify. There cannot, though, be notes in denominations
higher than ten thousand rupees in terms of the current provisions of the Reserve Bank
of India Act, 1934. Coins can be issued up to the denomination of Rs.1000. The
Reserve Bank manages currency in India. The Government, on the advice of the
Reserve Bank, decides on the various denominations. The Reserve Bank also co-
ordinates with the Government in the designing of bank notes, including the security
features. The Reserve Bank estimates the quantity of notes that are likely to be needed
denomination-wise and places the indent with the various presses through the
Government of India. The notes received from the presses are issued and a reserve
stock maintained. Notes received from banks and currency chests are examined. Notes
fit for circulation are reissued and the others (soiled and mutilated) are destroyed so as
to maintain the quality of notes in circulation. The Reserve Bank derives its role in
currency management on the basis of the Reserve Bank of India Act, 1934. The
Reserve Bank decides upon the volume and value of bank notes to be printed. The
quantum of bank notes that needs to be printed broadly depends on the annual
increase in bank notes required for circulation purposes, replacement of soiled notes
and reserve requirements. The Reserve Bank estimates the demand for bank notes on
the basis of the growth rate of the economy, the replacement demand and reserve
requirements by using statistical models.
The Reserve Bank manages the currency operations through its offices located at
Ahmedabad, Bangalore, Bhopal, Bhubaneshwar, Belapur(Navi Mumbai), Kolkata,
Chandigarh, Chennai, Guwahati, Hyderabad, Jaipur, Kanpur, Lucknow, Mumbai (Fort),
Nagpur, New Delhi, Patna and Thiruvananthapuram. These offices receive fresh notes
from the note presses. Similarly, the Reserve Bank offices located at Kolkata,
Hyderabad, Mumbai and New Delhi initially receive the coins from the mints. These
offices then send them to the other offices of the Reserve Bank. The notes and rupee
coins are stocked at the currency chests and small coins at the small coin depots. The
bank branches receive the bank notes and coins from the currency chests and small
coin depots for further distribution among the public. To facilitate the distribution of notes
and rupee coins, the Reserve Bank has authorised selected branches of banks to
establish currency chests. These are actually storehouses where bank notes and rupee
coins are stocked on behalf of the Reserve Bank. At present, there are over 4422
currency chests. The currency chest branches are expected to distribute notes and
rupee coins to other bank branches in their area of operation. Some bank branches are
also authorised to establish small coin depots to stock small coins. There are 3784
small coin depots spread throughout the country. The small coin depots also distribute
small coins to other bank branches in their area of operation. The responsibility for
coinage vests with Government of India on the basis of the Coinage Act, 1906 as
amended from time to time. The designing and minting of coins in various
denominations is also attended to by the Government of India. The Government of India
decides upon the quantity of coins to be minted.
HISTORICAL EVOLUTION
HISTORY OF CURRENCY
This first stage of currency, where metals were used to represent stored value, and
symbols to represent commodities, formed the basis of trade in the Fertile Crescent for
over 1500 years.
Coinage
Coins were supposed as store of value being the metal itself, the face value of a coin
was the same as its intrinsic value: at first silver, then both silver and gold. Metals were
mined, weighed, and stamped into coins. This was to assure the individual taking the
coin that he was getting a certain known weight of precious metal. Coins could be
counterfeited, but they also created a new unit of account, which helped lead to
banking. It was with Archimedes' principle that the next link in currency occurred: coins
could now be easily tested for their fine weight of metal, and thus the value of a coin
could be determined, even if it had been shaved, debased or otherwise tampered with.
In most major economies using coinage, copper, silver and gold formed three tiers of
coins. Gold coins were used for large purchases, payment of the military and backing of
state activities. Silver coins were used for large, but common, transactions, and as a
unit of account for taxes, dues, contracts and fealty, while copper coins represented the
coinage of common transaction.
Paper money was, in one sense, a return to the oldest form of currency: it represented a
store of value backed by the credibility of the issuing authority. Drafts and checks issued
privately had been in intermittent use for centuries, however, it was with the rise of
global trade that paper money would find a permanent place in currency.
The advantages of paper currency were numerous: it reduced transport of gold and
silver, and thus lowered the risks; it made loaning gold or silver at interest easier, since
the specie (gold or silver) never left the possession of the lender until someone else
redeemed the note; and it allowed for a division of currency into credit and specie
backed forms. It enabled the sale of stock in joint stock companies, and the redemption
of those shares in paper.
However, these advantages held within them disadvantages. First, since a note has no
intrinsic value, there was nothing to stop issuing authorities from printing more of it than
they had specie to back it with. Second, because it created money that did not exist, it
was subject to Gresham's Law: people would exchange money rather than coins of the
same value, and this increased the velocity of money and therefore increased
inflationary pressures, a fact observed by David Hume in the 18th century. The result is
that paper money would often lead to an inflationary bubble, which would then collapse
when the demand for paper notes fell to zero, and people began demanding hard
money. The printing of paper money was also associated with wars, and financing of
wars, and therefore regarded as part of maintaining a standing army.For these reasons,
paper currency was held in suspicion and hostility.
With the creation of central banks, currency underwent several significant changes.
During both the coinage and credit money eras the number of entities which had the
ability to coin or print money was quite large. One could, literally, have "a license to print
money"; many nobles had the right of coinage. Royal colonial companies, such as the
Massachusetts Bay Company or the British East India Company could issue notes of
credit—money backed by the promise to pay later, or exchangeable for payments owed
to the company itself. This led to continual instability of the value of money. The
exposure of coins to debasement and shaving, however, presented the same problem
in another form: with each pair of hands a coin passed through, its value grew less.
The solution which evolved beginning in the late 18th century and through the 19th
century was the creation of a central monetary authority which had a virtual monopoly
on issuing currency, and whose notes had to be accepted for "all debts public and
private".
By 1900, most of the industrializing nations were on some form of gold standard, with
paper notes and silver coins constituting the circulating medium. Governments too
followed Gresham's Law: keeping gold and silver paid, but paying out in notes.
The Paper Money Era
Originally, the value of money was determined by the intrinsic value of the
material the money was made of, such as silver or gold. However, carrying
around a lot of precious metal was cumbersome and often dangerous. As an
alternative, banknotes would be issued. In financial terms, a note is a promise to
pay someone money. Banknotes were originally a promise to pay the bearer an
amount of precious metal stored in a vault somewhere. In this way the stored
value (usually in gold or silver coins) backing the banknote could transfer
ownership in exchange for goods or services.
Paper money originated in two forms: drafts, that is receipts for value held on account,
and "bills", which were issued with a promise to convert at a later date.However the use
of paper money as a circulating medium is intimately related to shortages of metal for
coins. In the 600s there were local issues of paper currency in China and by 960 the
Song Dynasty, short of copper for striking coins, issued the first generally circulating
notes.
INDIAN CURRENCY
Rupee is the name of Indian coin and currency. It was derived from a
Sanskrit language word Rupya. Rupya literally means the wrought
silver used as coins of trade or currency during 600-400 BCE (Before
Common Era).
Earliest Vedic literature (1500-600 BCE) from India mention coins as Satamanas, so far
no specimens have been found. The coins issued by several Early Kingdoms from all
over the India from 600-500 BCE were found. These coins have symbol of sun with six
radiating arms. They are mostly referred as punch mark coins. Those symbols were still
in use during Mauryan Empire, first empire set up in India by Indian emperor. Minting
large quantities of coins and using them as a means of trade transactions in India began
during Mauryan period (500-400 BCE).
Second source was a book Arthasashtra (literally means science of money, figuratively
means monetary policy). It was written in Sanskrit language by Kautilya, prime minister
to the first Maurya emperor Chandragupta Maurya (c. 340-290 BCE). The book
mentions several types of coins. Gold coins (Suvarnarupa), silver coins (Rupyarupa),
copper coins (Tamararupa) and lead coins (Sisarupa). Rupa means form or shape.
Example: Rupyarupa --- Rupya - wrought silver, rupa - form.
Mauryas were followed by Indo-Bactrians (c. 185 - 50 BCE) and Kushanas (40-241 CE).
These empires in the north used portraits of the kings, Greek gods or Indian gods on
the coins. Satavahanas (120 - 300 CE) ruled central and southern India and issued
coins with pictures of elephants, horses and also kings' portraits.
Gupta Empire (320-540 CE) is considered as golden age of ancient India. Guptas
minted coins using molds and dies to give uniformity in shape. Gupta coins portrayed
pictures of royal activities and culture. Portraits of Hunter, horse rider, musician,
goddess of wealth Lakshmi or goddess of learning Saraswathi were used on the coins.
Around 600 B.C.E. During this time, quality and weight of silver bullion was
standardized to reduce the inconvenience of weighing the silver bullion for every
transaction.
Indian coins were cut out of a sheet of silver and clipped to adjust them into proper
weight. These coins were always made of pure silver not gold or electrum. Square,
rectangular and round shapes were used to make these coins. These early coins were
then impressed on one side with one to six punch marks of sun with six radiating arms.
The later coins were impressed with designs on both sides. These punch marks were
probably guarantee for the purity and weight of the coin by the king of local kingdom.
1/8 Karshapana
circa 500 BCE
Punch mark of sun with six radiating arms on reverse
The first coins of Indian subcontinent, minted 2600 years ago. It is beyond doubt that
the first coins of India were minted just before 5th century BC in Madhyadesha i.e.
central India. Although, few historian have suggested (based on Vedic records) that
India minted perhaps the first coins of the world which were introduced even earlier than
Lydian/Ionian coins, in 8th century BC; most scholars do not agree with this theory.
Both, literary and archaeological evidence confirm that the Indians invented coinage
somewhere between 5th to 6th century BC. The earliest coins of India are commonly
known as punch-marked coins.
India has been one of the earliest issuers of coins in the world (circa 6th Century BC)..
The original Rūpaya was a silver coin weighing 178 grams. The coin has been used
since then, even during the times of British India. Formerly the rupee was divided into
16 annas, 64 paise, or 192 pies. Decimalisation occurred in Ceylon (Sri Lanka) in 1869,
India in 1957 and in Pakistan in 1961. Each Anna was subdivided into either 4 paise, or
12 pies. Among the earliest issues of paper rupees were those by the Bank of
Hindostan (1770-1832), the General Bank of Bengal and Bihar (1773-75, established by
Warren Hastings), the Bengal Bank (1784-91), amongst others.In 1957, decimalisation
occurred and the rupee was now divided into 100 Naye Paise.
Notes issued by the Bank of Bengal can be categorised in the following three series.
Unifaced series-The early notes of the Bank of Bengal were printed only on one side
and were issued as one gold mohur and in denominations of Rs. 100, Rs. 250, Rs. 500.
Commerce series-Later notes had a vignette representing an allegorical female figure
personifying 'commerce'. The notes were printed on both sides. On the obverse the
name of the bank and the denominations were printed in three scripts, viz., Urdu,
Bengali and Devanagari. On the reverse of such notes was printed a cartouche with
ornamentation carrying the name of the Bank.
Brittania series-By late 1800s, the motif 'commerce' was replaced by 'Britannia'. The
new banknotes had more features to prevent forgery.
British India issues…………………………… Five Rupees, 1922 (The Paper Currency
Act of 1861.)
Victoria portrait series- The first set of British India notes were the 'Victoria Portrait'
series issued in denominations of 10, 20, 50, 100 and 1000. These were unifaced,
carried two language panels. The security features incorporated the watermark, the
printed signature and the registration of the notes.
Underprint series- The unifaced Underprint series was introduced in 1867 as the
Victoria Portrait series was withdrawn in the wake of a spate of forgeries.
George V seriesA series carrying the portrait of George V were introduced in 1923, and
was continued as an integral feature of all paper money issues of British India. These
notes were issued in denominations of Rs 5, 10, 50, 100, 500, 1000, 10,000
Two Rupees,
Republic of India- After Independence of India,
the government brought out the new design Re. 1 note in 1949. Initially it was felt that
the King's portrait be replaced by a portrait of Mahatma Gandhi. Finally however, the
Lion Capital of Asoka was chosen. The new design of notes were largely along earlier
lines. In 1953, Hindi was displayed prominently on the new notes. The economic crisis
in late 1960s led to a reduction in the size of notes in 1967. High denomination notes,
like Rs. 10,000 notes were demonetised in 1978.
Mahatma Gandhi series
Jammu and Kashmir issues- Maharaja Ranbir Singh introduced paper money on
watermarked paper in 1877. The notes were not very popular and were in circulation for
a very short period. The notes carried the 'Sun' motif of the Dogra family.
Other issues-
Persian Gulf issues- For many years in the early and mid 20th century, the Indian
rupee was the official currency in several areas that were controlled by the British and
governed from India; areas such as East Africa, Southern Arabia and the Persian Gulf.
After India devalued the rupee on 6 June 1966, those countries still using it - Oman,
Qatar and what is now the United Arab Emirates (known as the Trucial States until
1971) - replaced the Gulf Rupee with their own currencies. Kuwait and Bahrain had
already done so in 1961 and 1965 respectively.
Emergency issues:
MATERIAL USED IN
MANUFACTURING: -
A coin is usually a piece of hard material, generally metal and usually in the shape of a
disc, which is issued by a government to be used as a form of money. Along with
banknotes, coins make up the cash forms of all modern money systems. Coins are
usually used for lower-valued units, and banknotes are usually used for the higher
values; also, in most money systems, the highest value coin is worth less than the
lowest-value note. The market exchange value of a coin comes from its historic value,
and/or the intrinsic value of the component metal (for example gold or silver).However,
in modern times, most coins are made of a base metal and their value comes strictly
from their status as fiat money. This means that the value of the coin is decreed by
government fiat rather than agreed by the people, which really make it less a coin and
more a token in the strictest sense.
To distinguish between these two types of coins, as well as from other forms of tokens
which have been used as money, monetary scholars have defined three criteria that an
object must meet to be a "true coin". These criteria are:
1.It must be made of a valuable material, and trade for close to the market value of that
material.
2.It must be of a standardized weight and purity.
3.It must be marked to identify the authority that guarantees the content.
By the above definition, the invention and first known usage of coins comes from the
Kingdom of Lydia circa 643-630 B.C. Under three generations of Lydian kings, the
money of Lydia gradually moved from being lumps of electrum (a naturally occurring
alloy of silver and gold) to coins of a guaranteed weight and purity, marked with the seal
of the King.
Aluminium, Antimony, Carbon, Chromium, Cobalt, Copper, Gold, Hafnium, Iron, Lead,
Magnesium, Manganese, Molybdenum, Nickel, Niobium, Palladium Platinum, Rhenium,
Selenium, Silver, Tantalum, Tellurium, Tin, Titanium, Tungsten, Vanadium, Zinc &
Zirconium.
Acmonital, Aluminium Bronze, Argentan, Barton's Metal, Bath Metal, Bell Metal, Billon,
Brass, Bronze, Crown Gold, Cupro-nickel, Dow metal, Electrum, Franklinium, German
Silver, Gun Metal, Manganese Bronze, Nickel Brass, Nickel Silver, Nordic Gold,
Orichalchum, Pewter, Pinchbeck, Potin, Silver Alloys, Speculum, Stainless Steel, Steel,
Tombac, Virenium & White Metal.
Carbon, Clay, Fibre, Glass, Leather, Paper, Plastic, Porcelain, Selenium, Stone.
A Group 11 element is the series of elements in group 11 (IUPAC style) in the periodic
table, consisting of transition metals which are the traditional coinage metals of copper
(Cu), silver (Ag), and gold (Au). They are also known as the "noble metals."
Gold coins are typically produced as either 90% gold (e.g. with pre-1933 US coins), or
22 carat.
Silver coins are typically produced as either 90% silver - in the case of pre 1965 US
minted coins (which were circulated in many countries), or sterling silver (92.5%) coins.
Copper coins are often of quite high purity, around 97%, and are usually alloyed with
small amounts of zinc and tin.
They are all relatively inert, corrosion-resistant metals which have been used for minting
coins, hence their name. Many metals form colored compounds, such as iron pyrite,
and many metals have a colored sheen, but apart from caesium, which also has 1 6s-
electron, similar to gold, only gold and copper are colored.
These metals, especially silver, have unusual properties that make them essential for
industrial applications outside of their monetary or decorative value. They are all
excellent conductors of electricity. The most conductive of all metals are silver, copper
and gold in that order. Silver is also the most thermally conductive element, and the
most light reflecting element. Silver also has the unusual property that the tarnish that
forms on silver is still highly electrically conductive.
Gold, silver, and copper are quite soft metals and so are easily damaged in daily use as
coins. Precious metal may also be easily abraded and worn away through use. In their
numismatic functions these metals must be alloyed with other metals to afford coins
greater durability. The alloying with other metals makes the resulting coins harder, less
likely to become deformed and more resistant to wear.
Coins are made in such a way that chemically it becomes silent or rare reactive.Metals
or alloys used in coin should be heat resistance, hard, tough and ductile.Most of the
modern indian coins are made of cupro-nickel or Ferraite stainless steel. These
materials are tensile as well as ductile also, both are chemically less reactive. These are
tough and strong materials having good amount of fire resistance and heat resistance
inside them.
Metal Cupro-Nickel
Weight 9.00 gm
Diameter 23 mm
Shape Circular
Metal Cupro-Nickel
Weight 6.00 gm
Diametre 26mm
“When we die, our bodies turn into soil, which feeds trees, and when paper is made
from those trees some of that paper goes to produce paper money (bank notes),
banknotes you collect. Therefore please respect each other and let's respect the
bank notes we collect and take good care of them. Banknotes Are Us”
Latent Image - On the obverse side of Rs.1000, Rs.500, Rs.100, Rs.50 and
Rs.20 notes, a vertical band on the right side of the Mahatma Gandhi’s portrait contains
a latent image showing the respective denominational value in numeral. The latent
image is visible only when the note is held horizontally at eye level.
Identification Mark - A special feature in intaglio has been introduced on the left
of the watermark window on all notes except Rs.10/- note. This feature is in different
shapes for various denominations (Rs. 20-Vertical Rectangle, Rs.50-Square, Rs.100-
Triangle, Rs.500-Circle, and Rs.1000-Diamond) and helps the visually impaired to
identify the denomination.
Fluorescence - Number panels of the notes are printed in fluorescent ink. The notes
also have optical fibres. Both can be seen when the notes are exposed to ultra-violet
lamp.
See through Register - The small floral design printed both on the
front (hollow) and back (filled up) of the note in the middle of the
vertical band next to the Watermark has an accurate back to back
registration. The design will appear as one floral design when seen
against the light.
Legal provisions against counterfeiting Printing and circulation of forged notes are
offences under Sections 489A to 489E of the Indian Penal Code and are punishable in
the courts of law by fine or imprisonment or both. The Reserve Bank of India is the
central bank of the country entrusted with monetary stability, the management of
currency and the supervision of the financial as well as the payments system.
Established in 1935, its functions and focus have evolved in response to the changing
economic environment.
DESIGN PRESPECTIVE
Modern day’s coins are simply circular in shape or having polygonal edges in its shape.
In Head face most of them have portrait of any person, special sign or simply top of
Ashoka pillar. In other parts of the world the head face of a coin consists the
manufacturing year but most of Indian coins have it on its tail with the value of the coin.
One can easily visualize the whole nation through the currency of the country. In Indian
banknotes there are some specified criteria of design and size…..
Shape of Indian banknotes is generally rectangular…..
1 9.7 6.3 61
2 10.7 6.3 67
5 11.7 6.3 74
10 13.7 6.3 86
20 14.7 6.3 93
The designing and minting of coins in various denominations is also attended to by the
Government of India with RBI. All the coins and currency notes are issued the Reserve
Bank of India, except the Re. 1 note which was traditionally issued by the Government
of India until it was withdrawn from circulation.
ELEMENT OF DESIGN IN INDIAN CURRENCY:
Colours:
Currency of any country can represent the picture of whole country and the lifestyle
through its various designs, color, texture etc. India is a diverse country so currency is
also a medium for unity in diversity.
First image represents the various languages spoken in the country, second one shows
the lifestyle as farming, 100 rupees reverse image shows courage and policy we
adopted during our freedom struggle, 10 rupee shows the greenery beauty of India,
another 10 rupee in grayish dull colour shows trading and sense of adaptability of India
and the last one shows the amazing wild life of India. Generally the Indian banknotes
consist images like farmer, ploughing, dam, sailboat, sunrise, wheel, palm tree, tractor,
industry, parliament, tiger, peacock, rhino, earth, spacecraft, elephant, follower etc.
Colors of the notes are functional, symbolic and visible even for effected eyes. Texture
of the paper and printing are very significant and can easily identify the value of the note
with touching it only.
Different looks of modern Indian currency (Contemporary Indian banknotes)
MECHANISM & FUNCTIONING
Money. is a medium of exchange. Money has no intrinsic value -- its usefulness would
be lessened if it did. It works or functions on the credit system only. The bearer of the
currency is promised to pay the face value of the note. The whole currency works on the
theory---
“I PROMISE TO PAY THE BEARER THE SUM OF …… RUPEES’’
GUARANTEED BY THE CENTRAL GOVERNMENT
Rupee-.The Indian monetary unit, worth about 3 cents in exchange for U.S. money.
Used in payment for services or purchase of goods made in India, it is the Indian
equivalent of our dollar. Exchange rates fluctuate.The manufacturing mechanism of a
coin can be divided into two main stages - a) making the blanks and b) manufacturing
coins from the blanks.
HARDCORE MECHANISM
Printing process
The earliest printing process, the woodcut, is produced by cutting away the unwanted
part of a piece of wood. The design that is left in relief is inked up with a roller and
transferred to paper. The design is drawn directly on the wood which is cut plank wise or
along the length of the grain or tree trunk. Cut this way, however, the wood has a
tendency to splinter. Artists discovered that they could avoid the problem by cutting on
the end grain of hardwood blocks, a process called wood engraving. By using a burin,
the wood engraver could produce a wider range of tones than were possible with a
woodcut. This process was used on a few types of early style currency and in certain
"emergency" cases where this was the only type of printing process available.
Lithography
Lithography was the first fundamentally new printing technology since the invention of
relief printing in the fifteenth century. It is a mechanical Plano graphic process in which
the printing and non-printing areas of the plate are all at the same level, as opposed to
intaglio and relief processes in which the design is cut into the printing block.
Lithography is based on the chemical repellence of oil and water. Designs are done with
greasy ink or wax based tools on specially prepared stones or plates. They are then is
moistened with a liquid, which the plate accepts in areas not covered by the wax. An oily
ink, applied with a roller, adheres only to the drawing and is repelled by the wet parts of
the plate. The print is then made by pressing paper against the inked drawing.
Lithography was invented by Alois Senefelder in Germany in 1798 and, within twenty
years, appeared in England and the United States. Almost immediately, attempts were
made to print in colour. Multiple plates were used; one for each colour, and the print
went through the press as many times as there were plates. The problem for the
printers was keeping the image in register, making sure that the print would be lined up
exactly each time it went through the press so that each color would be in the correct
position and the overlaying colors would merge correctly.
Intaglio/Engraving
The process of intaglio printing was and still is the most popular form used by banknote
printing companies. It is an extremely time intensive process and requires the combined
handiwork of highly skilled artists, steel engravers, and plate printers. Engraved printing
plates are covered with ink and then the surface of each plate is wiped clean which
allows the ink to remain in the "valleys" of the design and letter grooves of the plates.
Each sheet is then forced, under extremely heavy pressure, into the finely recessed
lines of the printing plate to pick up the ink. The printing impression is three-dimensional
in effect creating "mountains of ink" on the banknotes. The height of these "mountains"
depends upon the depth of the grooves that the engravers made on the plates, the
quantity and type of ink used, and the pressure applied to force the paper into the
plates. The surface of the note feels slightly raised, while the reverse side feels slightly
indented. This process is called intaglio printing.
An original banknote printed using the Intaglio process noted above will have definition
of detail discernable by touch. There will be height to the ink. Different parts of the
banknote will feel more raised up than others due to the fact that the engravers would
engrave the plates at differing depths for different features of the banknote.
As time goes by and the banknote gets circulated more and more, the height of the ink
is slowly worn down until the note finally ends up looking "flat" and loses it's bright
colours. If a banknote is washed or pressed, the "mountains" become flattened and loss
of definition is noticeable. A true original high grade banknote will retain some or all of
this original definition.
Counterfeiting
Counterfeiting banknotes pervades the entire history of paper money. Tools to aid in the
battle against counterfeiting were and remain the finesse and complexity of design and
printing techniques. Coupled with special papers and security features, banknote
printing companies and issuing authorities ensure that their paper money would be very
difficult to reproduce.
The avid collector will encounter forged notes from time to time that even the untrained
eye can detect. There are however examples in history whereby a sovereign nation or
country has produced so-called "perfect" counterfeits of an enemy country. These were
normally created and secretly sent into circulation in order to create inflation with the
ultimate goal being to bring about the economic instability of the adversary. To the
collector, identifying these counterfeits requires great experience.
Paper Quality
The quality of banknote paper is one of the characteristic features that distinguish a
genuine banknote from a forgery.
Numbering
Serial numbers are printed horizontally and vertically with asymmetrical fonts and
different colours to make them more difficult to counterfeit. They are also printed with
special inks which penetrates the paper. As a result, the trace of the numbers can still
be seen under ultra-violet light if the numbers were to be tampered with.
Ordinary notebook paper is made from the intermeshed cellulose fibers of wood pulp.
The cellulose fibers absorb water and come apart (dissolve) when they are soaked in
water. Paper money is made from textile (rag) fibers, such as cotton and linen.
Intermeshed "rag" fibers bond together more firmly and don't separate (dissolve) in
water.The upper right corner (red arrow) of this currency bill is torn off. The magnified
view (right) of the torn edge shows a fringe of intermeshed textile (rag) fibers. These
fibers are much more durable than the cellulose fibers from wood pulp.
Process of making of a coin:
Blanking -
Upsetting -
The good blanks go through an upsetting mill. This raises a rim around
their edges.
Striking -
Finally, the blanks go to the coining press. Here, they are stamped with
the designs and inscriptions which make them genuine Indian coin
currency.
Inspecting -
Chandigarh
Noida
New Delhi
Jaipur
Lucknow
Guwahati
Kanpur
Patna
Bhopal
Salboni
Ahamadabad Dew as
Calcutta
Calcutta
Nagpur
Mumbai Nasik Bhuaneshwar
Mumbai
Byculla Hyderabad
Hyderabad
Press
Mysore Banglore
Mint
Chennai
Issue Offices
Trivandrum
DISTRIBUTION OF CURRENCY-
Agencies I nvolved
MOF
Police Railways
RBI's
RBI Presses
Govt
Presses
Mints Banks
(chests)
Public
Presses 4 Mints
Color-Shifting These inks, used in the numeral on the lower right corner of the face
Inks of the note, change color when the note is viewed from different
angles. The ink appears green when viewed directly and changes to
black when the note is tilted.
Fine-Line This type of line structure appears normal to the human eye but is
Printing difficult for current copying and scanning equipment to resolve
Patterns properly. The lines are found behind the portrait on the front and
around the historic building on the back.
Enlarged Off- The larger portrait can incorporate more detail, making it easier to
Center recognize and more difficult to counterfeit. It also provides an easy
Portraits way for the public to distinguish the new design from the old. The
portrait is shifted off center to provide room for a watermark and
unique "lanes" for the security thread in each denomination. The
slight relocation also reduces wear on most of the portrait by
removing it from the center, which is frequently folded. The increased
image size can help people with visual impairments identify the note.
Low-Vision The numeral, which represents the denomination, helps people with
Feature low vision, senior citizens and others as well because it is easier to
read.
Currency simply tries to bind the whole country together. It brings unity out of so
many diversities. It is the base of the Economy. The trading, business, share-
market all depends upon the currency. Indian National Rupee is a fluctuating
currency so its exchange value gets altered, it results the price raising or
economical crisis type of situation, when the each individuals get affected and
lots of bad results start to produce within the lifestyle or within the trading. So
it can badly affect one’s lifestyle and make serious changes. In short we can
say that 1 billion Indian are dependent on the behaviour of a rupee.
It produces the difference of rich, middle class, poor and below poverty line (BPL).
One can cross every limit for getting it. But it also produces good results it gives the
feel that we all are Indians. There is no barrier within us. It also represents the
lifestyle, social values, trading and technology to outside world. Clearly our currency
shows our policy to the world.
All the languages spoken here have same respect same with the people. One can
easily feel the happiness of having a thousand rupees note in pocket or at the same
time can also feel the emotion when there is no rupee in pocket. Most of the problem
can be solved with the help of these money notes. It is very essential to each aspect
of life….. Health, education, entertainment etc.
Since money is really just a representation of value, it didn't take long for people to
realize they could just send information about money by telegraph or other electronic
means, and it was just as "real" as sending the money itself. After World War II,
banks would record information about the day's transactions onto large magnetic
reels, which were taken to the regional Federal Reserve Bank. This system
eliminated the need for the large denominations that were printed prior to the war to
facilitate these large-scale transfers. Today, the $500, $1,000, $5,000, and $10,000
bills printed during this period are very rare, though some are still in circulation.
Later, wire connections were established between the banks, so the transfer
information could be sent directly.
By the early 1990s, all transfers between banks and the Federal Reserve were done
electronically.
There are three other important steps in the history of electronic money:
1. Diners Club issued the first credit card in 1950. At first, credit cards were
considered a special perk available mostly to rich businessmen. As soon as
banks realized there were billions of dollars to be made by issuing credit to as
many people as possible, credit cards exploded. Today's largest credit card
company, Visa, started out as the Bank of America, and issued the
BankAmericard in 1958. Today, there are over 200 million Visa cards in use in
the United States alone.
2. The Social Security Administration first offered automatic electronic deposit of
money into bank accounts in 1975. Once people became comfortable with the
concept of money being added to their accounts without ever holding the
cash, the practice spread. People started paying bills, transferring money
between accounts, and sending money electronically.
3. The growing worldwide acceptance of the Internet has made electronic
currency more important than ever before. Purchases can be made through a
Web site, with the funds drawn out of an Internet bank account, where the
money was originally deposited electronically. People are earning and
spending money without ever touching it. In fact, economists estimate that
only 8 percent of the world's currency exists as physical cash. The rest exists
only on a computer hard drive, in electronic bank accounts around the world.
A coloured foil design is hot-stamped onto the paper and is over-printed in using a
lithographic technique. When photocopying is used to reproduce the note, a black
spot appears in place of the foil.
Bearer Cheque
A type of cheque payable to whoever possesses it, rather than to a specific person
or organisation. They have occasionally served as currency, passing hands between
successive people, until someone cashes it in.
Block Numbers
A number printed on a note, indicating the specific printing run. Not the same as the
plate number or serial number.
Cancellation
Commemorative
Demonetisation
Emergency Issues
Notes issued during times of economic turmoil, usually when the country's national
currency approaches worthlessness, or as a substitute for coins when metal is in
short supply.
Error Notes
Notes with design errors such as spelling mistakes and notes with badly-printed
features or other manufacturing faults. They are sought-after as collectibles.
Fantasy Note
The physical condition of a banknote; the degree of wear and tear. A minor difference
in grade has a significant effect on value.
Guerrilla Notes
Guilloche
Intaglio Printing
Printing method using an engraved plate. Oil is applied to the surface of the plate.
Ink is then applied, which, due to the oil, only adheres in the engraved grooves. The
plate is then pressed onto the paper, where the ink held in the grooves transfers to
the paper.
Notaphily
The word someone coined to mean 'banknote collecting'. It never really caught on,
because many collectors don't like the sound of it, or feel it doesn't convey the fine
qualities of this great hobby.
Political Notes
Remainders
Notes which were printed, but never issued. They sometimes lack authorising
features such as signatures, dates etc.
Replacement Notes
Notes from a sheet used to replace any sheet in a print run that failed to pass the
quality control standards. They can be identified by their special serial number prefix.
They are invariably more valuable than the normal banknotes due to their relative
scarcity.
Reprint
A note printed from the original plate, often by someone other than the original
authorised printer, usually long after the note has become obsolete. These should
not be confused with ordinary reproductions, which are not printed using the original
plate and are worth much less as collectibles.
Security Features
Devices incorporated into banknotes to make forgery difficult, including foil security
threads, micro-text, special inks, and silk threads imbedded in the paper.
Serial Numbers
The consecutive numbers printed on each successive banknote during a print run,
using a mechanised numbering machine, to give each note a unique identity.
Skit Notes
Specimen Notes
Demonstration notes for private distribution to banks, etc., for identification purposes,
just prior to the release of a new series. They are printed with the same equipment
as the real item, but carry no monetary validity. To indicate this, they are usually
overprinted or perforated with the word "SPECIMEN" in the language of the issuing
country.
Test Notes
These items are produced for testing cash dispenser, ATM machines etc. They
imitate the size and weight of the genuine banknotes, but are printed with designs
significantly different from the real notes. Some bear the words "TEST NOTE".
Vignette
Fake money/ counterfeit money -duplicate money, manufactured with forgery by non
authorized body.
Inflation
It is when a certain form of currency starts to have less value over time. It is caused
mainly by two things: people's perception of value, and the economic principle of
supply and demand.
CONCLUSION & RECOMMENDATION
At a whole we see that India was one of the first countries to start coin for the
purpose of exchange of things. Anciently it was based on intrinsic theory, which says
that the face value and the metallic intrinsic value of the coin should be same. After a
few time when Maurya, Gupta etc came in power in medieval India the system of
coin changed from intrinsic to extrinsic value in which coin are supposed to be equal
to their face value, the system was based on credit system. Later the era of paper
money came to India from its origin country China, Sher sah Suri introduced the
paper money in India before that leather and plastic like polymers were used in
manufacturing the currency. The paper money or banknotes bring the era of
prosperity and development in the field of currency. Under British Empire India also
come front in manufacturing of paper money. Reserve Bank of India is established
with the view of monitoring the currency management in India. After republic various
admonitions get cancelled and new system of decimal applied to the Indian currency
in place of Ana system. Now the shape and size of Indian coin and notes are more
impact and constructive.
But the role of the currency never decreased, it increased all the time. Now it is not
only the medium of exchange but it is symbol of the financial strength of the country.
Currency also represents the lifestyle, social values, history, economy and policies of
the nation.
The manufacturing process of coins is minting & engraving with a pre-defined shape.
Most of the coins of modern days are circular or poly-edged & banknotes are simply
rectangular in shape. Cupro-nickel & stainless steel is mainly used in minting of
Indian coins & textile fiber with textures matt paper is used in making of Indian
banknotes. The whole currency management is monitored by Reserve Bank of India
with its chests bank branches all over the country.
The design of the currency is defined by RBI and Govt. of India. The bank note, used
as a legal tender, consist the credit promise with the authorized signature of the
Governor, RBI. The different design printed on the paper money shows the lifestyle,
trading and policy of India. It also stands for the cultural, geometrical, political and
economical identification of the nation.
Transporting and distribution of Indian currency are monitored by RBI with the help of
Indian railway, police, ministry of finance etc. The network of bank and the whole
banking system of India is revolved around the currency; actually the banking system
is started with the view to control the currency distribution and to help in currency
management process.
As Indian agencies involved in currency introduces advanced technology, so the
quality and security level of Indian currency is getting upraised. It will also help in
prevention of counterfeit money. With this the exchange value of Indian currency with
respect to Dollar or Euro is getting strength day to day, therefore the future of Indian
currency is very bright.
Indian money is not only a medium of exchange or not just only for purchasing things
but it is also a binding force and the best possible communication source. It also
gives us the brand loyalty of India and make us remember and proud that we are a
part of this amazing India.
RECOMMANDATION
Indian currency is getting better in all the directions. Either it is advanced technology
or banking system or security system or the capacity of printing and minting currency
or prevention of fake currency. There are remarkable achievements all around.
Simultaneously Indian rupee is getting strengthens in international market also.
So this is the best time to repair every possible weakness in the currency. And simply
RBI should be more careful in preventing the fake money operations. It can be cure
with the help of advanced hologram printing and introducing new designs and
shapes of banknotes.
Suggestion for coin……. RBI & Indian government should rethink on the value or
denomination of coins which can bring more efficiency in function of the currency.
Coins of face value Rs.3, Rs.9 & Rs.27 can make a difference in the whole system
with pre-existing 1 rupee coin. We can easily purchase things up to the price of 40
rupees with the help of these four coins only and we will never feel the need of 2
rupees, 5 rupees and 10 rupees coin. The idea is little bit odd in view of decimal
system of currency but surely it will work better. It can easily remove the problem of
lack of the coins or the “CHILLAR” (khule paise).
Coins…. Rs.1, Rs.3, Rs.9 & Rs.27
For example
We have to purchase a pen of price Rs. 33. Now we have to give (27+9)
coins and the retailer will return a three rupee coin.
So simple and so easy
Another example for price 29 rupees………. (27+3) -1
Coins should be circular in shape so that it can easily carry and handle, should
be made of standard stainless steel, which will also decrease the manufacturing cost
and will increase the properties of the coins. Coins will lighter with respect to present
days coins due to the lower density of the metal used.
Coins should consist the engraving of looms on its head and face value with map of
India & Ashoka pillar on its tail because textile industry is the biggest industry of India
and map of India due to the unity in diversity within the country.
Suggestions for notes ……. Indian banknotes should be more colour sensitive, it
means that different colour should be use in different note so that the larger part of
the population, who are not literate can make difference between two notes easily.
More use of textile fiber can add water insolubility to the notes. For better result
water repellant should be used on the surface of notes which can make it more
waterproof. Better quality of paper can increase the life spam of the banknotes.
Banknotes should be bundled with polyethylene in place of paper; it can minimize
the external unexpected damages.
The design on the notes should be more specific and related to present days
problems can make better sense because through this any message can be send to
each individual of the country. The security features should be such that one illiterate
can also differentiate between the fake currency or counterfeit currency and a
genuine currency.
The shape of banknotes should be around a golden rectangle. It will look better and
will easy to handle also. Dollar size or Euro size Indian rupees banknote can bring
smile on the face of imported purse-lover.
BIBLIOGRAPHY
Information gathered from our Mentor, Mr. Suhail Anwar sir.
Information gathered from the faculties of all the subjects
Information from Punjab National Bank, Green Park branch & ICICI bank,
Hauz Khas branch
www.rbi.gov.in
www.money.howstuffworks.com
www.ancienthistory.com
www.collectpapermoney
www.mint.fi
www.banknotes.com
www.answers.com