Why is “I Promise to Pay the Bearer Sum” Written on Currency Notes? Here’s Everything You Need to Know

Long before money was invented, People exchanged services and goods for other services and goods in return, for instance, a farmer may exchange a bag of rice for chicken from a poultry farmer. Here each commodity has its own “VALUE”

why i Promise to pay the bearer sum of 100 Rupees is written on Indian Currency0
why I Promise to pay the bearer sum of 100 Rupees is written on Indian Currency0

But all of today’s currencies are FIAT money – means “so be it” Fiat money, by contrast, has no intrinsic value – it is essentially a promise from a government or central bank that the currency is capable of being exchanged for its value in goods

And the value of the fiat currency is not backed by gold, silver, or any commodity. Instead, its value is based on trust and faithThe trust and faith that if somebody held a note of 100 rupees then it is accepted throughout the country and one can buy goods/services of 100 rupees at any cost

The declaration of the RBI governor increases the faith of the Currency holder in the currency of the country

why i Promise to pay the bearer sum of 100 Rupees is written on Indian Currency
why i Promise to pay the bearer sum of 100 Rupees is written on Indian Currency

It also ensures to the currency holder that the note is the legal tender in the country and the recipient of the currency note does not carry any risk in holding the currency

Here is of meaning of i promise to pay the bearer the sum, i promise to pay the bearer the sum written on the currency notes is called the