The Rashtrakutas and their Times c22.98

c22.98

Let us now proceed to ascertain the rate of interest. There is sufficient epigraphical evidence to help us in this matter. A Kanheri inscription of the time of Amoghavarsha I (71) mentions a certain investment in a local bank, which had agreed to pay an interest in perpetuity upon it. This record states that the rate of interest was to be determined by experts from time to time. This provision was a reasonable one; the guild had to pay the interest in perpetuity, and no definite rate could be guaranteed for all time to come. The rate must vary with the conditions of the money market. It is, however, worth noting that a similar saving clause does not occur in the numerous other inscriptions of our period, which state the agreed rate of interest on deposits given in perpetuity. It is, however, not unlikely that in practice the banks of the guilds and the village communities, which had bound themselves to supply interest at a certain rate, may have been allowed some latitude, if the condition of the money market was severely adverse to them.