Indian (Gujarat, Rajasthan, MP, UP): Hindu (Bania, Vania) and Jain name, from Gujarati sah ‘merchant’ (from Sanskrit sadhu ‘honest’, ‘good’). This name was originally Sah; it appears to have been altered under the influence of the Persian word for ‘king’
Shah or its variants "Sah", "Shaha", "Sahu" or "Sha" is a common Gujarati last name.
A large fraction of all Jain, vaishnavs, specially from Gujarat and southern Rajasthan have the last name "Shah".
Sometimes it is mistakenly thought that it is derived from the Persian "Shah" meaning "King". Actually it is of Indian origin[1]. It is derived from Sanskrit Sadhu (meaning gentleman) and Prakrit Sahu.
The word Sadhu/Sahu is also separately used to indicate a Jain monk. See Namokar Mantra.
In numerous 12-13th century inscriptions the shravaka who installed the image, is given the title "Sahu"[2].
सं १५१० वर्षे माघ सुदी ८ सोमे गोपाचल दुर्गे तोमर वंशान्वये राजा श्री डूंगरेन्द्र देव राज्य पवित्रमाने श्री काष्ठासंघ माथुरान्वये भट्टारक श्री गुणकीर्ति देवास्तत्पट्टे श्री मलयकीर्ति देवास्ततो भट्टारक गुणभद्रदेव पंडितवर्य रइघू तदाम्नाये अग्रोतवंशे वासिलगोत्रे सकेलहा भार्या निवारी तयोः पुत्र विजयष्ट शाह ... साधु श्री माल्हा पुत्र संघातिपति देउताय पुत्र संघातिपति करमसीह श्री चन्द्रप्रभु जिनबिंब महाकाय प्रतिष्ठापित प्रणमति ..शुभम् भवतु ..||
The word Sadhu here does not mean a monk but a "gentleman". Some inscriptions abbreviate sahu by just "sa" just like we write "Mr.".
In some business communities, genealogies are recited during marriages, all ancestors would be respectfully called "sahu".
The term "sahukari" means the profession of banking/trading. In the Bundelkhand Jain community, the father-in-law (or son's/daughter's father-in-law) used to be called "sahaji".
Thus the words "Shah" etc. all indicate a respected member of the mercantile community.
Today it is used by Gujarati business communities.