"The Khalsa history is of (the) brave (men)... it motivates people," the minister said while addressing a gathering after releasing the coin.
The minister said it would be good if a documentary on the Sikh warrior's life was made since not all know the Sikh history.
Jaitley recalled the battles fought by Banda Bahadur against the Mughal army and how he attained martyrdom 300 years ago.
Banda Bahadur established his rule to protect honour and tradition of his people, by defeating Mughals in 1710. Later in 1716, at the age of 46 he was captured and executed by Mughals in Delhi.
The release of the commemorative coin comes months ahead of the 2017 assembly elections in Punjab.
A few weeks ago, the Arvind Kejriwal government in Delhi put out newspaper advertisements to announce renaming of the Barapulla flyover after Banda Singh Bahadur.