Latest / The Hidden History of Bengal: Kingdoms, Empires, and Revolution — Fexingo History / Cossimbazar's Fabulous Wealth: Bengal's Lost Banking Dynasty
Transcript
- Lucas: So, we've talked a lot about the battles and the big political shifts in Bengal — Plassey, Buxar, the rise of the Company. But there's a family that was pulling strings from behind the scenes, and their story is almost too incredible to be true. Luna: The Jagat Seths, right? I've heard the name but I don't really know who they were. Lucas: Exactly. The Jagat Seths — the name literally means 'banker of the world' — were a family of Jain bankers from Cossimbazar, a town near Murshidabad. By the mid-1700s, they were arguably the wealthiest private bankers in the world. Their fortune was estimated at something like fourteen million rupees in gold and silver, which was more than the entire treasury of the Bank of England at the time. Luna: More than the Bank of England? That's staggering for a family business. Lucas: It really is. The family's rise began under a man named Hiranand Sahu in the late 1600s. He moved from Rajasthan to Bengal and started as a humble moneylender. But his grandson, Fatehchand, really built the empire. Fatehchand earned the title Jagat Seth from the Mughal Emperor Farrukhsiyar in the 1720s, after helping the emperor secure loans and manage his finances. From then on, the family controlled the mint at Murshidabad and ran an extensive network of hundis — those are bills of exchange that allowed money to move across India without physically transporting coins. Luna: So they were like a central bank before central banks existed? Lucas: Exactly right. They didn't just lend money — they issued credit, set exchange rates, and kept accounts for the Nawab of Bengal himself. When Alivardi Khan became Nawab, the Jagat Seths were his main financiers. And when Alivardi died in 1756, his grandson siraj ud daulah inherited the throne — and a massive debt to the Jagat Seths. Luna: And that's where things get tense, right? Because Siraj didn't exactly get along with his bankers. Lucas: No, he didn't. Siraj was young, headstrong, and suspicious of the family's power. He demanded that the Jagat Seths hand over their accounts, and he even had one of their agents beaten. That was a fatal mistake. The Jagat Seths, led by Mahatabchand and his uncle Fatehchand, decided that Siraj had to go. So they secretly allied with the British East India Company, and their money and credit helped fund the conspiracy that led to the Battle of Plassey in 1757. Luna: So they essentially bankrolled the coup that put Mir Jafar on the throne. Lucas: Precisely. Mir Jafar was their puppet, and they expected to control him. But it didn't work out that way. Mir Jafar couldn't pay back his debts, and the Company started demanding more and more power. After Plassey, the Jagat Seths still had immense wealth, but their political influence began to slip. Then came the Battle of Buxar in 1764, where the Company defeated the combined forces of Mir Qasim, shuja ud daula, and Shah Alam II. After that, the Company got the diwani — the right to collect taxes in Bengal, Bihar, and Orissa. Luna: And that must have cut the Jagat Seths out of the loop, since the Company now controlled the revenue. Lucas: Exactly. The Company didn't need the Jagat Seths as intermediaries anymore. They started their own banking operations, and the family's power waned. But it wasn't just economic — it was physical. In the 1770s, the Jagat Seths were targeted by the Nawab of Murshidabad, who resented their wealth. Two of the family's leaders were murdered by assassins. That was effectively the end of their dominance. Luna: That's a brutal fall from grace. So what happened to the family after that? Lucas: They continued as minor bankers, but never regained their former glory. The British systematically dismantled their network. By the early 1800s, the Jagat Seths were just another wealthy family, not the titans they'd been. Their story is a perfect illustration of how indigenous financial systems were replaced by colonial ones. And it's a reminder that history isn't just about kings and battles — it's about the people who moved the money. Luna: You know, it's interesting how we're talking about a family that funded wars and shaped politics, and yet most people have never heard of them. Lucas: That's exactly the kind of story we try to tell here. And it's also a good moment to mention that we keep this show free and ad-free by design. We don't run ads, we don't have sponsors — that's a choice. If you like what we do and want to support it, the simplest way is through buy me a coffee dot com slash fexingo. No pressure, just a way for listeners who find value in these conversations to help us keep going. Luna: Yeah, it's a small gesture that goes a long way. And it keeps the show exactly what it is. Lucas: Right. So back to the Jagat Seths — one of the most fascinating aspects is how their hundi system worked. A hundi was essentially a written order from one banker to another to pay a certain sum to a named person. It was like a check, but centuries earlier. And it allowed merchants to travel from Bengal to Surat or Delhi without carrying a single coin. The Jagat Seths had agents in every major city, and their hundis were accepted everywhere. Luna: So it was a trust-based system. Your reputation was your currency. Lucas: Exactly. And the Jagat Seths' reputation was impeccable — until the British came. The Company, with its military backing, could enforce payment in ways that no private banker could. And they actively worked to undermine the hundi system, because it was a rival to their own financial control. By the 1830s, the use of hundis had declined significantly, replaced by Company-backed paper money and bank drafts. Luna: It's like they were erased from history, not just overshadowed. Lucas: In a way, yes. But their legacy lives on in a few places. The name Jagat Seth is still remembered in Murshidabad, and their old havelis are there, though in ruins. And the concept of the hundi survived in some form in informal money transfer systems, like the hawala used in South Asia today. So their innovation didn't die — it just went underground. Luna: That's a great way to tie it to the present. I think our listeners will really appreciate this hidden chapter.