Phasing out of Scottish banknotes in Scotland

flaneurs_lobster

https://forums.moneysavingexpert.com/discussion/comment/81864943#Comment_81864943

If any Scottish note issuer were going to stop then the obvious candidate to be first is Clydesdale/Nationwide.

No Clydesdale brand (outwith a few mortgage products) or branches to promote, if they were to stop tomorrow I doubt if anyone would notice for months.

Section62

https://forums.moneysavingexpert.com/discussion/comment/81866044#Comment_81866044

Yes, if Nationwide were going to keep the Clydesdale brand active (say for business banking, or as a quasi-fintech) then there would be some sense in continuing to issue Clydesdale banknotes for brand recognition purposes in Scotland.

But as Virgin/Clydesdale/Yorkshire customers are set to become Nationwide members customers, with no announced plan to maintain the Clydesdale brand for anything, continuing to issue Clydesdale banknotes would appear to be (from a Nationwide perspective) an expensive vanity project* with no obvious benefit to Nationwide's wider membership. (though clearly of more value to those who use and value the heritage of Scottish banknotes).

*So I expect Nationwide will continue issuing Clydesdale banknotes for the foreseeable future, and nobody needs to worry about their loss.

Maegi

https://forums.moneysavingexpert.com/discussion/comment/81866093#Comment_81866093

I fully expect Nationwide to phase out Clydesdale Bank branded notes as both the brand and legal entity are essentially going. Nationwide (being registered in England and Wales) isn't even allowed to issue Sterling notes as the Bank of England has a monopoly there unlike Scotland and NI.

Part of reason that there are fewer Scottish notes in ATMs is that once Clydesdale starting using the VM brand they also stopped supplying other ATMs providers - they had previously been one of the largest Scottish note issuers whilst being smaller than BOS and RBS.

That leaves BOS, RBS or the BOE to obtain Sterling notes from.

Section62

https://forums.moneysavingexpert.com/discussion/comment/81867545#Comment_81867545

Yet this document (page 4) says "Clydesdale will remain Scottish banknotes issuer" after the Part VII legal transfer is completed in April 2026 -

https://www.nationwide.co.uk/-/assets/nationwidecouk/documents/about/how-we-are-run/results-and-accounts/2025-2026/investor-presentation-interim-results-2025-26.pdf

flaneurs_lobster

https://forums.moneysavingexpert.com/discussion/comment/81867683#Comment_81867683

Not exactly a long-term commitment to banknote production, sounds more like a sop to those who might object to the takeover, as they do to any corporate or cultural change that might diminish or dilute "Scottishness" in anything.

I'll give it a year, recon De La Rue's contract will have a 12 month notice period.

WillPS

I'll leave it to the smarter economists to confirm or deny this, but I believed that the ability to literally print money offered the licensee some kind of tactical advantage?

The note printing license was, I thought, something that Halifax particularly sought when they performed the reverse takeover with BOS to form HBOS; and similar for Danske with Northern Bank.

I feel quite sure that if it was just a vanity thing then at least one of the 6 non-BoE issuers would have packed it in by now, particularly as one of the brands has been otherwise all-but-dead to consumers for over 5 years.

flaneurs_lobster

I'll leave it to the smarter economists to confirm or deny this, but I believed that the ability to literally print money offered the licensee some kind of tactical advantage?

Literally? Don't believe so. A Central Bank can "print money" in the sense of buying up debt and increasing money supply (QE) but I don't think that's what you mean.

The non-BoE note issuers have to deposit an equivalent amount of Sterling with the BoE (as physical notes or cash deposit) equal to that which they wish to issue. So difficult to see what (economic) benefit note issuing gives.

WillPS

https://forums.moneysavingexpert.com/discussion/comment/81867992#Comment_81867992

There must be something in it for them though, note printing isn't free so if it's like for like then surely the whole operation would be an enormous cost centre?

flaneurs_lobster

https://forums.moneysavingexpert.com/discussion/comment/81868247#Comment_81868247

See earlier in the thread. The benefits are advertising - bits of pretty polymer with the bank's name on them in many pockets and tills, although this must be dubious since Clydesdale is no longer a High Street name - and not being the first "Scottish" bank to pull out of note issuance.

I'd put money (in Scottish fivers) on there being discreet polling happening to try and gauge the effect of stopping issuance although it would be a hard one to quantify.

Would I think twice about opening a savings account or taking out a mortgage with a company that had ceased a near 200 year history of proud Scottish/not English banknote production?

No, but others may have a different attitude.

Section62

https://forums.moneysavingexpert.com/discussion/comment/81868299#Comment_81868299

Reflected in the tone/thrust of this article -

https://www.dailyrecord.co.uk/news/scottish-news/scottish-bank-notes-quietly-phased-35507570