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Nattukottai

Chettiars
By
Debanga Sourav Gogoi
PGP/006/01

Introduction
Trading & Money lender community of South India.
They are considered as thePioneers of Modern
Banking. They introduced the terms " Pattru (debit),
Varavu (credit), Selavu (expenditure), Laabam
(profit), Nashtam (loss) " which are all, collectively,
known as "Iynthogai (trial balance). (source:
internet, )
The term Chettiar is allied to the Sanskrit term
Sreshti which means banker or big merchant.
Original resident of Chettinad comprising Eastern
part of Ramnad district and Trichynopoly of Tamil
Nadu
Sub divided into 9 exogamous clan named after 9
temples of Chettinad.

Uniqueness
They have gained the most eminence because of
their trading activities extended far beyond their
Home base Chettinad. There were many eminent
mercantile communities in Southern India like
Komatis of Andhra, The Nadars of Tamil Nadu,
Syrian Christans of Kerala. Among them
Nattukottai Chettiar is the one who successfully
expanded their business up to South East Asia.
They adopted a unique co-existence of their
Spiritual & Business life dating from at least 11th
century. They made advantage of their religious
behaviour to indirectly help their business. (dual
identity )

Link between Chettiar and


Temples
Chettiars were initially engaged in Salt trading.
Temples in Tamil culture are the Institutions of
Capital investment , accumulation, and
distribution.
Temples receive endowment from rulers & trading
communities , which was used for money lending
for agriculture , business purposes.
Nattukottai Chettiars established links with
temples through out their homeland to associate
themselves with economic activities of temples.

Link between Chettiar and


Temples (Contd..)
Used religious gifting (tithe) as the license fee to
do business in that locality near by temple.
(Palani)
Became Endowment manager and got a part of
the endowment which they can reinvest in their
business.
Trustworthy: By worshipping the deities of their
customers, they gained their trust and made
advantage in their salt business.
More integration with Temple economy

As a business community
A successful business community, who always looks for
the Business opportunity .
o They were able to grow their business using religious
identity.
o They were able to do business across different geographic
region and culture responding to the need of time. They
migrated to Malaya, Burma, Siam, Java, Northern
Sumatra and Thailand.
o Always they diversified or changed their business domain
as per opportunity exist.
Salt business> > Money Lending + Banking >>
Industry
o They partnered with different agencies (Burmese,
European) , wherever they looks business gain.
o Helped each other for Community growth .

Religious identity

Saiviate Hindu (worshipper of Lord Shiva)


Spiritual
They started Tithe and Collective worship.
Most of the chettiar temple were dedicated to
Shivas son and he was regarded as temple
committee chairman.
Mostly temples were used as Commercial centre
points along with religious activities.
They are involved in organizing religious festivals .

Fall of Salt Business &


Money lending in India
Towards the end of 18th century, a severe drought
reduced commerce between in-land salt
consuming and coastal salt producing regions.
By 1805 Major Salt renters became weak and East
India company took over the monopolistic control
of the production.
Nattukotai Chettiars moved their commercial
operation towards south as Pearl, Rice, Cloth and
Arak of Ceylon and towards north Rice & Wheat
business at Calcutta
The served as a Creditor/financial institutions.
But they lost this business to Europeans as they
have started their own bank Presidency bank of
Madras

Business in Burma
After fall of their credit markets in Madras and
exchange market in British India , they were
looking for opportunities .
Their first offices were opened in Rangoon in
1852.
New land policy by British after 1852.
o
Goal was the concentration of ownership in the
hands of individual cultivator and land owners.
o
Agriculturalist would be able mortgage their
holdings to get loans from money lenders.
Huge Rice and other agricultural production,
which needed more capital for the agriculturalist .

Business in Burma
(Contd..)
Nattukottai Chettiars community started lending.
In some regions they lent through Burmese
money lenders .
They worked under an agency system- After 18
young man would be sent from Chettinad to learn
under older member of the Clan.
From 1880s they started expanding through Delta
area beyond Rangoon establishing new offices .
Nexus with European Rice millers. The farmers
who borrow Chettiars capital were indirectly
forced to sell crops at Millers price.

Business in Burma
(Contd..)
Whoever failed to return the debt, Chettiar took
over the land although they dont want to as
Agriculture was not their prime business.
After 1st world war there was an export market
downfall causes more default of loans.
Finally collapse of Many Small Chettiar money
lending firms.
Each firm also operated as a Commercial bank.
They had a well managed banking system with
the facilities of depositing money, drafting bills
and other financial instruments.

Commerce to Industry
They were involved in saw milling industry , as
they have exported Timber from Burma to India.
They also established and acquired a number of
Rice mills, some being set up by Burmese with
Chettiar capital.
Also started some Cotton Textile industry centered
around Coimbatore.

Thank
You !

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