Paper money and digital money

Once coins were used for everything, from vegetables to land, what happened? Carrying and storing huge numbers of coins became hard: the portability problem again! The answer was paper money.

Paper money was first used in China, about a thousand years ago, and came to India in the late 18th century. Early Indian notes include ones from the Bank of Bengal and a ₹10 note from the Bank of Bombay.

Currency is the money system a country uses. Denominations are the units it comes in. In India, coins of 50 paise, ₹1, ₹2, ₹5, ₹10, ₹20 are used for smaller amounts, and paper notes like ₹10, ₹20, ₹50, ₹100, ₹200, ₹500 for bigger ones. (The book's list also has a ₹1000 note; that note was withdrawn in 2016.)

Long ago, rulers issued coins. Today in India only the Reserve Bank of India (RBI) can issue currency; it's illegal for anyone else.

Look closely at a ₹50 or ₹100 note: the back shows India's cultural heritage. Feel it too: notes have raised marks so that people who can't see can tell the amount by touch.

Technology has brought new kinds of money. Krishnappa sells fruit from a cart. Beside the fruit is a small card with a QR code (quick-response code): a pattern of black and white squares that phones can read, holding his bank account details. Customers scan it and pay; the money goes straight into his bank account. Today even many auto-rickshaw drivers and street vendors take payment this way!

So money can be tangible (coins and notes you can touch) or intangible (you can't touch it): digital money, in electronic form. Debit cards, credit cards, net banking and UPI (Unified Payments Interface) move money directly from one bank account to another.

Look how money got lighter: an ox → coins → paper notes → cards → QR codes, where nothing physical moves at all!