Agency Houses in British India, were trading companies that arose in 17th and 18th century India during the

Company rule in India Company rule in India (sometimes, Company ''Raj'', from hi, rāj, lit=rule) refers to the rule of the British East India Company on the Indian subcontinent. This is variously taken to have commenced in 1757, after the Battle of Plassey, when ...

History

Background

In the 17th and 18th century, most of Eastern India came under the rule of the

East India Company The East India Company (EIC) was an English, and later British, joint-stock company founded in 1600 and dissolved in 1874. It was formed to trade in the Indian Ocean region, initially with the East Indies (the Indian subcontinent and Southea ...

. India, then, was a major producer of spices and dyes, primarily

Indigo Indigo is a deep color close to the color wheel blue (a primary color in the RGB color space), as well as to some variants of ultramarine, based on the ancient dye of the same name. The word "indigo" comes from the Latin word ''indicum'', m ...

. The trade of Indigo was a major business. The agency houses were initially formed to trade in commodities, primarily Indigo. The agency houses were also involved in all the financial dealings that arose from the export of these commodities to Europe.

Business

Before the advent of joint-stock banking companies in India, the role of banks was played by agency houses. The agency houses performed various quasi-banking functions which included but were not limited to: * Accepting deposits (agency houses accepted deposits only from British nationals and other Europeans) * Financing trade * Lending of money (primarily to the Government)

Downfall

In the 19th century, synthetic Indigo had been invented by

Adolf von Baeyer Johann Friedrich Wilhelm Adolf von Baeyer (; 31 October 1835 – 20 August 1917) was a German chemist who synthesised indigo and developed a nomenclature for cyclic compounds (that was subsequently extended and adopted as part of the IUPAC org ...

at the German company

BASF BASF Societas Europaea, SE () is a German multinational corporation, multinational chemical company and the List of largest chemical producers, largest chemical producer in the world. Its headquarters is located in Ludwigshafen, Germany. The ...

. This gradually reduced the demand for natural Indigo sourced from India. As a result, the agency houses of British India gradually faded away and were replaced by new conglomerates and trading companies.

Legacy

The agency houses played a major role in shaping the economy of colonial India. Several early banks in India, such as the Bank of Hindostan, were founded by these Agency Houses. They also invented the Tinkathia System, which was a major point of contention during the

Indian independence movement The Indian independence movement was a series of historic events with the ultimate aim of ending British Raj, British rule in India. It lasted from 1857 to 1947. The first nationalistic revolutionary movement for Indian independence emerged ...

List of notable Agency Houses

The Agency Houses of British India include: * Alexander and Company - They founded the very first bank in India, the Bank of Hindostan *

Palmer and Company The Palmer and Company, Limited, often simply called Palmer and Co. was an Agency House in British India founded by John Horsley Palmer. Palmer and Co. was the largest Agency House in British India. History Background Before the advent ...

- Founded by officials of the

and one of the wealthiest agency houses * Fergusson and Company * Mackintosh and Company * Cruttenden and Company

References

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External Links

History of Agency Houses
Economic history of India Trading companies of the United Kingdom