The Forgotten Story of Jagat Seth Bankers Who Funded Mughals and British
The Forgotten Story of Jagat Seth: The Bankers Who Funded Mughals and the British
Money has always been a power in human affairs. This is the history of a financial dynasty and its money power.
The Jagat Seth house was to the Bengal Nawabs what the Fuggers
of Augvsburg were to Emperor Charles V of Gennany
The Rise and Fall of the Jagat Seths:
The Banking Dynasty That Changed Indian History
Origins of a Financial Empire
The story begins in the 1650s in the dusty town of Nagaur, Rajasthan.
A young man named Hiranand Sahu, a modest jeweller, dreamed of bigger things.
In 1652, he moved with his family to Patna.Patna at the time was one of India’s greatest commercial hubs.
It was a major centre for saltpetre (shora), the key raw material for gunpowder, which was in huge demand in Europe due to constant wars.
It was also a vital river port on the Ganges, where trade routes converged.Hiranand seized the opportunity.
He started trading in saltpetre and quickly built strong relationships with British, Dutch, and French merchants.
His business prospered so rapidly that it evolved from trading into full-scale banking.
He began lending money at interest to merchants, nobles, and even officers of the East India Company.Hiranand had seven sons
Sadanand, Govardhan, Rupchand, Malukchand, Aminchand, Dhanraj, and the eldest, Manik Chand.
They expanded the family’s banking network across northern India, opening branches in Hooghly, Kolkata (Calcutta), Banaras, and beyond.
The family came to be known as the “Seths” (bankers).Their greatest innovation was perfecting and scaling the hundi system a sophisticated, trust-based financial instrument similar to modern cheques or bills of exchange.
A merchant could deposit money in one Jagat Seth branch and receive a hundi, which could be cashed at another branch hundreds of miles away without physically moving cash.
This eliminated the extreme risks of highway robbery.
The system ran entirely on the family’s reputation and became the backbone of inland trade and even government revenue transfers to Delhi.
Rise to Unparalleled Power -
Manik Chand was sent to Dhaka, then a major centre for textiles and opium.
There he formed a close alliance with Murshid Quli Khan, the efficient Diwan (revenue minister) of Bengal.
When Murshid Quli Khan shifted his capital to Murshidabad, Manik Chand went with him.Under Manik Chand’s supervision, the royal mint of Bengal operated, and land revenue was collected through his firm.
He earned handsome commissions on currency exchange (called batta). By some estimates, his wealth at its peak was comparable to nearly a trillion dollars in today’s terms greater than the entire banking reserves of England at the time. He also owned vast tracts of land in Bengal and maintained a private army for the protection of his treasure.After Manik Chand’s death in 1714, his adopted son Fateh Chand took over and surpassed him.
In recognition of his immense financial power, Mughal Emperor Muhammad Shah (Rangila) bestowed upon him the title “Jagat Seth” Banker of the World.
The family financed Mughal princes, lent heavily to European companies (British, Dutch, and French), and even influenced successions.
In 1740, Fateh Chand financed a coup that replaced the arrogant Nawab Sarfaraz Khan with Alivardi Khan.
the Jagat Seth family really did lend money to Mughal emperors and Bengal rulers of their time.
They were not just bankers to merchants but to kings.
Here are the key rulers they financed:
Mughal Emperors -
Farrukhsiyar (1713–1719)
He became emperor largely because of Jagat Seth loans. They financed his army when he was still a prince in Bengal.
With their money, Farrukhsiyar marched to Delhi and seized the throne.
In return, he granted the East India Company tax‑free trading rights in Bengal, Bihar, and Orissa a turning point in colonial history.
Muhammad Shah Rangila (1719–1748)
He formally gave Fateh Chand the title Jagat Seth (“World Banker”).
The family continued to provide loans and manage imperial revenue transfers.
Bengal Nawabs -
Alivardi Khan (1740–1756)
Jagat Seths financed his coup against Nawab Sarfaraz Khan. Their money and influence put Alivardi on the throne.
Siraj‑ud‑Daulah (1756–1757)
Initially clashed with them (famously slapped Mehtab Rai in court).
Their anger and loss of trust led them to support Robert Clive and Mir Jafar in the Battle of Plassey (1757).
East India Company -
Between 1718–1730, the Company borrowed large sums (about ₹4 lakh at 9% interest) from Jagat Seths to pay salaries, bribes, and daily expenses.
Later, they secretly funded Clive’s campaign against Siraj‑ud‑Daulah.
Their loans literally decided who sat on thrones and who lost them.
They were kingmakers, and their financial power shaped the fate of India in the 18th century.
The Fatal Slap and the Conspiracy -
After Alivardi Khan’s death in 1756, his 23-year-old grandson Siraj ud-Daulah became Nawab.
Impulsive, arrogant, and lacking political wisdom, Siraj quickly alienated powerful courtiers.
He sidelined his generals, seized his aunt’s treasure, and harboured deep jealousy toward the Jagat Seths’ wealth and influence.
When Siraj needed funds for war, he summoned Mehtab Rai (the current Jagat Seth) and his cousin Swarup Chand to court and demanded ₹3 crore.
Upon refusal, he slapped Mehtab Rai publicly and insulted the devout Jain family with the threat of circumcision.
Deeply humiliated, the Jagat Seths decided Siraj had to go.
They joined hands with discontented generals like Mir Jafar, formed a secret alliance with Robert Clive of the East India Company, and promised massive payments once Mir Jafar became Nawab.
The Jagat Seths financed the military campaign and bribed key people.
On 23 June 1757, the Battle of Plassey took place.
It was less a battle and more a carefully staged betrayal.
Mir Jafar barely fought.
Heavy rain ruined the Nawab’s gunpowder while the British protected theirs.
Siraj’s forces collapsed. He fled, was captured, and later killed.
Mir Jafar was installed as Nawab.
Betrayal and Downfall -
The British soon began looting Bengal through Mir Jafar.
They drained the treasury with gifts and “compensation.” Worse for the Jagat Seths, Mir Jafar granted the Company the right to mint coins in Calcutta directly cutting into the Seths’ most profitable business.
When Mir Jafar could no longer satisfy British demands, they replaced him with his son-in-law Mir Qasim in 1760.
Mir Qasim proved more capable and independent.
He shifted his capital to Munger and tried to level the playing field by abolishing taxes on Indian merchants.
This brought him into direct conflict with the British.
During the tensions, Mir Qasim discovered letters from Mehtab Rai urging the British to attack him and offering to finance the war.
In 1763, Mir Qasim lured Mehtab Rai and Swarup Chand to Munger under false pretences and imprisoned them in the fort.
Despite offering a huge bribe of ₹4 crore for their lives, they were executed reportedly shot or thrown into the Ganges on the orders of a German mercenary in Mir Qasim’s service.
In short:
Founder: Hiranand Shah (1650s)
Successor: Manik Chand (d. 1714)
Next: Fateh Chand (Jagat Seth I, d. 1744)
Next: Mehtab Chand (active till 1757)
Parallel: Swaroop Chand (mid‑18th century)
Decline: 19th century
Dissolution: 1912
Today:
Descendants survive within the Sheherwali Jain community of Murshidabad and Azimganj.
They live ordinary lives, far removed from the days when their loans decided the fate of emperors and empires.
The mansion and temples are heritage sites, reminders of their vanished glory.
For Furhter reading -
Key Book on Jagat Seth Family
Title: House of Jagat Seth
Author: J. H. Little
First Published: 1920–21 (in Bengal Past & Present journal)
Reprint Editions: 1960, 1967 by Calcutta Historical Society
Introduction: Professor N. K. Sinha (renowned historian of Bengal’s economic history)
Length: ~264 pages
Sources Used:
India Office Records (London)
Siyar‑ul‑Mutakherin (Persian chronicle)
Riyaz‑us‑Salatin
Jagat Seth family papers
Scrafton’s Reflections
Vansittart’s Narrative
Wilson’s Annals
Why It’s Important -
It is the only dedicated monograph on the Jagat Seth dynasty.
Provides primary source references from both Indian and British archives.
Shows how money power shaped politics in 18th‑century Bengal.
Essential reading for understanding the financial roots of colonial expansion.
Other Works Mentioning Jagat Seth
S.C. Hill – The Three Frenchmen in Bengal (1903)
Mentions Jagat Seth’s role in financing and politics around Plassey.
Ghulam Husain Khan – Siyar‑ul‑Mutakherin (Persian chronicle, 1780s)
Primary source describing Jagat Seth’s involvement in Siraj‑ud‑Daulah’s downfall.
Robert Orme – History of the Military Transactions of the British Nation in Indostan (1778)
Notes Jagat Seth’s wealth and influence in Bengal.
N.K. Sinha – Economic History of Bengal (mid‑20th century)
Uses Jagat Seth as a case study in Bengal’s banking and revenue system.
P.J. Marshall – Bengal: The British Bridgehead (1987)
Discusses Jagat Seth’s role in the transition from Mughal to British power.
Tapan Raychaudhuri & Irfan Habib Cambridge Economic History of India (1982)
Mentions Jagat Seth in the context of hundi networks and financial dominance.
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