The Nakarattars banking system is based on:-

Caste based banking system

The correct answer is Option (2) → Caste based banking system

The Nakarattars (or Nattukottai Chettiars) were a Tamil mercantile caste from South India, particularly from Tamil Nadu, known for their extensive banking and financial networks during the late 19th and early 20th centuries. Their banking system was caste-based because it relied heavily on trust, kinship, and community ties within the caste.

They operated through informal yet highly reliable networks offering services like money lending, deposit taking, and trade finance, all underpinned by caste solidarity and mutual accountability.