World Economy

Millions of Banknotes Sent to Scotland

Millions of Banknotes Sent to Scotland Millions of Banknotes Sent to Scotland

Britain’s banks have been quietly moving millions of banknotes north of the border to cope with any surge in demand by Scots to withdraw cash in the event of a Yes vote in Thursday’s independence referendum, it has emerged.

Sources told The Independent the moves have been taking place over the past week or so in order to make sure ATMs do not run out on Friday in the event of a panic reaction to a “yes” vote. There have been some suggestions that people will want to move their money to English banks in the event of an independence vote.

Bankers stressed there has been no sign yet of any increase in the amount of withdrawals from deposit accounts or ATMs, stressing that there was no need because the Bank of England has pledged to stand behind all accounts for at least 18 months in the event of a “yes” vote.

However, concerns about how safe their cash is still linger. It was this that led to RBS and Lloyds last week to reassure customers that they would be moving their registration addresses south of the border.

As a result, part of the banks’ contingency plans has been to ship more cash to secure locations in Scotland in readiness to keep up with the potential increase in demand.

Sources at major banks said they had been issuing clear instructions to their Scottish branches to reassure customers there was no reason to panic.

One said: “We have seen a big rise in customers coming in and asking us what would happen, but there is no sign of any significant flow of deposits from north to south.”

Banknotes are made at a Bank of England printer in Debden, Essex, and held in secure depots run by a group of major banks around the country. The money is moved around the country in secure vans under a little-known arrangement called the Notes Circulation Scheme, which informs the Bank if more notes need to be printed.

Figures from the Bank of England show the number of notes in circulation has been creeping up steadily over the last year. This month there are 62.3 billion notes in the country, compared with 59.8 billion a year ago.

Meanwhile, a series of major figures in US politics and economics warned Scots against a Yes vote. Alan Greenspan, former US Federal Reserve chairman, said the economic consequences would be “surprisingly negative for Scotland”.

However, the Yes campaign received succour from a major German bank, days after Deutsche Bank voiced fears that a Yes vote would herald a 1930s-style depression. Its rival Commerzbank has said such speculation has been overdone.

The bank’s economists said “some of the worst-case scenarios painted in recent days appear exaggerated”, providing evidence that Scottish shares have actually outperformed those of the UK as a whole this year, rather than registered any major collapse.