Studies in Ancient Hindu Polity (Based on the Arthashastra of Kautilya), Vol. I c14.s3.9

c14.s3.9

In view of the general correspondence of the Saṃhitās as to the rule that 1¼ p.c. per month is the interest to be charged on a secured loan, I am inclined to take the passage in Kauṭilya, "सपादपचा धर्म्या मासरद्धिः पञ्चतस," as applicable to secured loans. This view gains further support when we take into account the fact that no separate rates of interest are by the next passage as 5 p.c. per month. But the rate is allowed to increase in view of the risks to which the investment of the money lent, and consequently its realization,