In this article, members of the Scottish Currency Group (SCG) continue their series explaining how a separate Scottish currency can be introduced soon after independence, and the implications for the Scottish economy, Scottish Government, businesses and households.

The article reflects SCG views on the policies which the group believes should be adopted in the future.

This article concentrates on what will change for ordinary citizens. Further articles will examine the future value of the Scottish Pound, and the impact on mortgages, other loans, pensions, and savings.

How will the new currency affect me?

FOR most people, daily life will be the same. You will just have Scottish notes and coins in your pocket instead of English ones.

Existing notes from the Scottish Banks will be replaced by new notes from the Scottish Reserve Bank, the new Central Bank of Scotland.

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It is possible the new Scottish Central Bank will allow the main Scottish banks to continue to issue their own designs of banknotes but as cash is much less used these days this is probably unlikely.

Your bank will arrange to set up whatever new bank accounts or bank cards you need.

Will I be forced to convert my savings into Scottish Pounds?

NO. Everyone will be free to choose how much of their savings they wish to exchange into Scottish Pounds. If you prefer to keep your savings in English pounds sterling you will be able to do so.

Will I have to exchange my current money?

NO. This will be done automatically as you spend it and it is paid back into the banks. Banks in Scotland will only issue Scottish currency.

This means any sterling notes or coins paid in will be removed by the banks and sent off to the central bank. Only Scottish notes and coins will be issued to shops and via cash machines.

When the euro was introduced the old currencies largely disappeared from circulation within two weeks.

What about my wages?

THIS depends on your employer.

If you work for the Scottish Government, Scottish health service, a council or any other public-sector body then from the first month your wages will be paid in Scottish Pounds. You will not have a choice about that. The amount you get paid will be exactly the same as before.

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If you work for someone else, then it is up to you and your employer to agree whether they will continue to pay you in English pounds sterling or switch to Scottish Pounds.

Most employers are likely to switch to the Scottish Pound within a month or two, simply because using sterling will become inconvenient. Paying in sterling would mean they would have to make tax and national insurance calculations in Scottish Pounds, but pay you in English pounds.

Will I need to do anything?

YES, you will need to decide if you want to have new Scottish currency accounts and cards and if you want to keep your existing sterling accounts and cards. Your bank will contact you some months in advance of the introduction of the new currency and ask you if you would like to have an account or accounts in the new currency.

You will need to instruct them to set up these account(s) if that is what you want. If you don’t want to keep your sterling accounts and cards, then instruct the bank to close those and transfer any balances to your new accounts.

If you make purchases from the rUK often, have family and friends in rUK, or travel often to rUK then it would be sensible to retain an English pound bank account for the time being.

What will change for me?

AS far as the day to day running of your money is concerned, everything will be dealt with by your bank and the banking finance system. Mortgages, loans, pensions, and investments are all computerised.

You will just have new account numbers but exactly the same balances as before, for anything that is exchanged into the new Scottish Pound.

Many countries operate perfectly well with more than one currency in use. It will be business as usual, although the banks will need to update your bank cards, online banking details and any pay-in books.