Author: Ummadevi Suppiah and S S Raja Year: 2016 Publisher: University of Malaya Press This book provides a panaromic view of the Chettiar community’s banking activities in Malaya over a 150 years. It traces how they evolved from being pre-modern traders to become the indispensable bankers of Malaya at every stage of British Malaya’s economic development between 1786 – 1957. The book is based on pain staking research which references a plethora of court cases, colonial papers, academic papers, books in Tamil and interviews with surviving elderly Chettiar bankers. Using solid data, the authors show that Chettiar banking was the critical catalyst that financed the opium trade, the early days of tin mining, the rise of the rubber industry and the growth of padi cultivation in Malaya. They were also the banker’s of choice for civil servants, Malay royalty and Chinese entrepreneurs. Giants of the Malayan economy like (tin) Yap Ah Loy, Loke Yew, Khaw Soo Cheang, A Guthrie, Loke Yew, (padi) Choon Chen Kean , (rubber) Tan Chay Yan, Tan Kah Kee, Tan Cheng Lock and others leveraged their business growth on Chettiar credit and co-investment. The authors argue convincingly that the Chettiars’ success was based on accessibility, simple loan procedures, strict adherence to British law and a reputation for honesty whilst charging lower interest rates than Sikh and Chinese moneylenders. Though always on the right side of the law, at times their liberal lending practices to the more vulnerable segments of Malayan society appears to have been self-serving and pre-meditated. Their greatest competitive advantage was their universal accessibility through the Kittangi branch banking network. The Kittangi branches enabled over an estimated 1,039 banking firms to be located in even the most remote parts of the Malayan hinterland and operate as a highly organized community. The Chettiars deployed their capital with a disciplined interest rate structure and customized financial instruments that could meet a wide spectrum of financial needs ranging from that of a single day loan for a day trader up to that of a syndicated loan with a 5 years horizon for a tin/rubber tycoon. The extraordinary risks they took, which European banks were averse to take, gave them commensurate extraordinary returns. This book will be an indispensable reference for scholars in the fields of Malayan economic history, Malayan banking, Indian immigration and Chettiars. It also sets a benchmark for meticulous research and extensive bibliography. Despite its heavy subject matter and wide breadth it is concise, well organized and an easy read.
