The currency of the United Kingdom, the oldest currency still in circulation in the world, is divided into Pound and Pence, the Pound is the monetary unit of notes, what we call on the European continent “the Pound Sterling”. Coin money is called penny (for a single penny in the singular) and pence in the plural.
The name “Sterling” would come from the first coins bearing a small star, or from the esterlin unit of measurement formerly used by goldsmiths and which became currency in ancient Rome or even in reference to the men of the East “Easterlings” and their reputation for integrity in the gold trade.
Until the mid-19th century, private banks in Britain and Ireland were free to issue their own bank notes. This paper currency was issued by a wide range of provincial and municipal banking companies in England, Wales, Scotland and Ireland.
There was a shortage of gold to issue coins and banknote printing powers were progressively limited by various acts of Parliament, notably the Bank Charter Act of 1844; which will gradually lead to a monopoly on the issuance of banknotes by the Central Bank of England alone. Under this, no new banks can start printing their own notes and private banks with this right are gradually disappearing through mergers and closures. The last English retail bank notes were issued in 1921 by Fox, Fowler and Company, a bank in Somerset County.
Several issuing banks in Scotland and Ireland
On the other hand, some of the provisions on this monopoly of the Bank of England only apply to England and Wales. The Scottish Notes Act was passed the following year, and to this day three retail banks still retain the right to issue their own sterling notes in Scotland under the Banking Act 2009: Bank of Scotland, Royal Bank of Scotland and Clydesdale Bank.
Following the partition of Ireland, the Irish Free State created the Irish pound in 1928, this new currency was pegged to the pound sterling until 1979. The issuance of Irish pound notes then came under the authority of the Monetary Commission of the Republic of Ireland, which replaced the notes of private banks with its own from 1928. Finally, four banks could also issue notes in Northern Ireland: Bank of Ireland, First Trust Bank, Danske Bank and Ulster Bank.
While in most countries in the world the issue of banknotes is exclusively managed by a central bank or directly a government, the United Kingdom therefore has the particularity of completely officially authorizing seven retail banks to print their notes. own banknotes.
Negotiations are currently underway to make the Scottish pound legal tender in England and Wales. If until now the acceptance of the Scottish pound had remained at the discretion of English and Welsh traders, this change in the law would oblige them to accept the Scottish pound as a compulsory means of payment.
