It used to be common for commercial banks to issue banknotes for value received, and then these notes could circulate from person to person just the way money does today. If the holder of the banknote brought it to the bank, he could redeem it for government money of some sort, such as gold coins or government notes.
In the U.S., commercial banks were allowed to issue notes until 1935, in accordance with an 1863 law. From what I can tell, the government issued standard forms for the denominations that could be issued, but then the individual bank would stamp it with the words, “The First National Bank Of Podunk will pay to the bearer on demand”, and then the amount.
So, I know we don’t have this sort of thing in this country anymore, but are there any countries in the world where banknotes are still issued by ordinary commercial banks that also do retail banking with the general public?
Hong Kong has a number of banks that still issue their own notes, as does Great Britain, where you can find different notes issued in Scotland and Northern Ireland - I’m not sure about Wales or other places like Gibraltar?
Sorry, but the names of the banks that issue the notes in those places escape me at the moment. I’m sure you can Google 'em.
Well, as far as I can see, in Scotland, we still have banknotes issued by the Clydesdale Bank, the Bank of Scotland, and the Royal Bank of Scotland, all being normal high street banks. I recall that the £10 pound Clydesdale note caused much amusement to a Nigerian friend, as it carries a sketch map of his area (or nearby) of Nigeria (the connection being David Livingstone).
Never rich enough to have too many of them in my pocket but, in Northern Ireland IIRC, you can get Ulster Bank, First Trust and Northern Bank notes. I’m not sure whether you can get Bank of Ireland notes too because the last time I used one of their ATM’s, it dished out Bank of England notes.
A while ago each individual branch of the Ulster Bank could issue their own notes, with the name of the bank on it. And of course there’s the whole issue of whether or not they are legal tender, you can search the boards for the explanation to that one.
Even though there are branches of some of these banks in the Republic of Ireland, I think there was only one bank note from the central bank down south. Course they’ve had the Euro for a while so my memory’s a bit hazy.
Yes you can get Bank of Ireland sterling notes, issued by their Belfast branch - and I even managed to get one accepted in an English pub (with some arguing)
None of them are legal tender, but then again legal tender has no meaning except in the repayment of a debt - in any other situation, the seller can accept or refuse whatever (s)he wants. The Crown copyright on issuing banknotes only ever covered English (and therefore Welsh) law, hence Scotland and N Ireland being able to produce their own notes.
So, how do these Scottish banknotes work? Are they distinctly different in appearance from ordinary British currency? Do they circulate widely? Would I be likely to get one in change from a Glasgow grocery store? If I did, would another merchant be likely to accept it? Do these notes ever make their way down to England, and if so, are they freely accepted there?
They tend to circulate widely in Scotland - 9 times out of 10 you will be given Scottish banknotes in Scotland. The only place I have found in Edinburgh that will give you English money are the NatWest ATMs - everywhere else you will get Scottish notes.
Scottish notes aren’t technically legal tender - even in Scotland, but they are accepted universally in Scotland. Most places in the border regions will accept Scottish banknotes, but the further south you go, the harder it is to get people to accept them (IME).
Angua is quite right - don’t give it a second thought which version you recieve in change, or from an ATM, in Scotland. However, sometimes it can be simpler to make sure of English banknotes if going to England… No big deal - it pretty much comes down to the typical co-incidence that just when you are very tired from sleepless travelling, or very much in a hurry, or whatever, that is just when one gets to encounter some shopkeeper who is dubious about them. And sometimes it just saves time and hassle to get hold of some food, or newspaper without having to spend time explaing things to said shopkeeper. I do think there is less of that now, but I know I once once amused to change a Clydesdale note (i.e. not one that even says “Scotland” on it very clearly) in a bank in Munich with more politeness and less hassle than I had previously met from English shopkeepers. (Yeah, that was sort of silly of me, but, well, I had no other money to choose from )
The bank had never met one before, suggested to me that maybe I meant Irish, not Scottish, then got out a nice collection of sample banknotes, perused it to no avail, and ultimately decided that ,yes, my note was fine, and once they’d swapped it for useful Deutschmarks, would be a new addition to their collection.
btw - I mentioned David Livingstone previously - bad me - wrong wandering missionary-type bod - I should have said the Nigeria connection was Mary Slessor.
I agree that Scottish notes may be refused in English shops, even though there’s no good reason why they should be. Very recently I was behind a guy in a late night general store in London who had just been working on a building site in Scotland and had been paid in cash. The guy behind the counter didn’t trust the money he wanted to use and it resulted in an interesting exchange of opinions.
As far as the appearance of the notes is concerned, the Scottish notes are the same size as the English ones, but the designs are completely different. For instance, here’s a Bank of Scotland £20, and here’s a Bank of England £20. The other Scottish banks’ notes are different again.
Some English shops don’t accept Scottish notes because they in turn have trouble getting their bank to take them - mainly because they’re a different size and weight and therefore don’t work in the automatic counting machines…
On the mention of coins, there are also 50p coins from the Isle of Man, and I’ve come across 20ps from Jersey and Gibralter. All these are the same size and shape as the standard ones, just a different pattern on the reverse.
And on another related note, the Bermudian coinage is slightly bizarre - identical in value and in pysical size to US coins, but with the Queen’s head on one side. Very odd-looking.
I’m not sure what the deal is with Korea, the largest currency note is equivalent to under 10 dollars, so most everyone uses some sort of bank ‘check’ for large purposes.
I was told that the small currency is intended to defeat counterfeiting by North Korea – ie, the North could destabilize the South’s currency by printing lots of large notes. They’d have to print a hell of a lot more small notes to achieve the same result.
And for the sake of clarity, the won is printed by a central bank, so its really neither here nor there.
Point being - any purchase over around $100 is done with these goofy bank “drafts” or notes, that in fact seem all too counterfeit prone, people use them as cash equivalents.
American paper currency is strangely impersonal and vague. Nobody promises to pay us anything, and the notes are signed by Administration officials who report to the President. At least as far as the appearance of our money goes, the government is not attempting to maintain the fiction that you could take your paper money to a window somewhere and get “real” money for it. The only other kind of money that exists in this country is small change.
And the word “bank” no longer appears on any note except the $1 bill, against which I have ranted frequently elsewhere. Instead we have only the highly impersonal and distant sounding “Federal Reserve System” indicated as the makers of the notes.
but, in Northern Ireland IIRC, you can get Ulster Bank, First Trust and Northern Bank notes. I’m not sure whether you can get Bank of Ireland notes too because the last time I used one of their ATM’s, it dished out Bank of England notes.
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