What was the component of the informal system and had no legal standing which were used for commerce and credit transactions?

see full answer

Your Exam Success, Personally Taken Care Of

1:1 expert mentors customize learning to your strength and weaknesses – so you score higher in school , IIT JEE and NEET entrance exams.

An Intiative by Sri Chaitanya

Epigraph

Hundi

Jharoka

None of the above

answer is B.

(Unlock A.I Detailed Solution for FREE)

Best Courses for You

JEE

NEET

Foundation JEE

Foundation NEET

CBSE

Detailed Solution

Hundi was the component of the informal system and had no legal standing which was used for commerce and credit transactions.
A Hundi is formally defined as a written, unconditional order from one person to another ordering that another pay a specific amount of money to the person specified in the order. During the Indian Middle Ages, hundis, which are a component of the informal system and have no legal standing, were used for commerce and credit transactions but are not covered by the Negotiable Instruments Act of 1881. A Hundi is basically an unrestricted agreement or order that guarantees a monetary payout that may be transferred through legally binding negotiation. In India, the history of hundis is quite old. They have been used since at least the twelfth century, according to written documents. Banarasi Das, a trader born in 1586, received a hundi from his father for 200 rupees to enable him to take out a loan and begin his business.

Watch 3-min video & get full concept clarity