DOI Page / Citation link:
https://doi.org/10.11588/diglit.52452#0095
T, 107.
DEBTS J INTEREST.
67
periodical interest. That interest is termed stipu-
lated interest which has been promised by the debtor
himself.
* 104. Interest at the rate of one Pa^a or quarter
of a Pa;za, paid regularly without diminishing the
principal, is denoted kayika interest. Interest upon
interest is called compound interest.
*105. This is the general rule for interest to be
paid on loans. There are special rules according to
the local usages of the country where the loan has
been made.
* 106. In some countries the loan may grow till
twice the amount of the principal has been reached.
In other countries it may grow till it becomes three,
or four, or eight times as large as the principal.
107. The interest on gold, grain, and clothes may
rise till it amounts to two, three, or four times the
principal. On liquids, the interest may become
octuple ; of women and cattle, their offspring (is con-
sidered as the interest).
paid every day, without diminishing the principal, i.e. if the whole
principal has to be restored, though ever so much interest may have
been paid on it, it is called kayika interest. Where interest at the
rate of 5 per cent, per mensem has been paid for twenty months,
it will reach the same amount as the sum originally due, so that the
principal is doubled. After twenty months more it becomes quad-
ruple ; twenty months later it becomes octuple, and so on. This
is called compound interest. A. Brz'haspati and Vyasa derive the
term kayika from kaya ‘ a body,’ and explain that it denotes bodily
labour, or the use of a pledged slave.
105. Where local customs obtain, differing from the rules pre-
viously given, they have to be followed. A.
106. 107. Manu VIII, 151; Vishzzu VI, 11-17 ; Ya^navalkya II,
39 ; Gautama XII, 36.
107. Gold borrowed at whatsoever rate of interest shall grow till it
becomes double; grain, till it becomes treble; cloth, till it becomes
F 2
DEBTS J INTEREST.
67
periodical interest. That interest is termed stipu-
lated interest which has been promised by the debtor
himself.
* 104. Interest at the rate of one Pa^a or quarter
of a Pa;za, paid regularly without diminishing the
principal, is denoted kayika interest. Interest upon
interest is called compound interest.
*105. This is the general rule for interest to be
paid on loans. There are special rules according to
the local usages of the country where the loan has
been made.
* 106. In some countries the loan may grow till
twice the amount of the principal has been reached.
In other countries it may grow till it becomes three,
or four, or eight times as large as the principal.
107. The interest on gold, grain, and clothes may
rise till it amounts to two, three, or four times the
principal. On liquids, the interest may become
octuple ; of women and cattle, their offspring (is con-
sidered as the interest).
paid every day, without diminishing the principal, i.e. if the whole
principal has to be restored, though ever so much interest may have
been paid on it, it is called kayika interest. Where interest at the
rate of 5 per cent, per mensem has been paid for twenty months,
it will reach the same amount as the sum originally due, so that the
principal is doubled. After twenty months more it becomes quad-
ruple ; twenty months later it becomes octuple, and so on. This
is called compound interest. A. Brz'haspati and Vyasa derive the
term kayika from kaya ‘ a body,’ and explain that it denotes bodily
labour, or the use of a pledged slave.
105. Where local customs obtain, differing from the rules pre-
viously given, they have to be followed. A.
106. 107. Manu VIII, 151; Vishzzu VI, 11-17 ; Ya^navalkya II,
39 ; Gautama XII, 36.
107. Gold borrowed at whatsoever rate of interest shall grow till it
becomes double; grain, till it becomes treble; cloth, till it becomes
F 2