How did the Hundi system support long-distance trade?

It acted as a safe, portable credit note that eliminated the need for carrying bullion, thus facilitating trade across diverse political territories.

What is a Hundi? | Medieval Indian Financial Terms (2020 PYQ)

ID: HIS_MED_2020_06 Ref: Standard Educational Reference

Which of the following phrases defines the nature of the 'Hundi' generally referred to in the sources of the post-Harsha period?

AI Quick Summary (View Answer)

Correct Option: C

A Hundi is a financial instrument that served as a 'Bill of Exchange' in Medieval India, allowing merchants to transfer funds and secure credit for trade.