One of Northern Ireland's most feared paramilitary hardmen has urged Ulster loyalists to keep out of Scotland's independence campaign because they could seriously damage the pro-UK cause.

Sam "Skelly" McCrory, commander of the Ulster Defence Association's prisoners in the Maze prison during the last years of the Troubles, said Northern Irish loyalists would alienate Catholic voters and other centre-left Scots who plan to vote against independence if they showed up in Scotland.

McCrory was arrested in the early 1990s and convicted in relation to a plot to murder the then IRA commander in Belfast. He was also believed to have been involved in several high-profile UDA murders in Greater Belfast from the late 80s to the early 90s.

The militantly Protestant Scottish Orange Order is planning a pro-union march of up to 25,000 Orangemen and women through central Edinburgh five days before the Scottish independence referendum takes place on 18 September.

The parade – potentially the largest by the order to take place in the Scottish capital in decades – will feature Orange Order flute bands, Orange lodges in full regalia and members of the Apprentice Boys of Derry from Northern Ireland.

Senior figures in the pro-UK Better Together campaign have said they fear a direct link between the Orange Order and the anti-independence cause only days before the referendum could provoke an unwelcome backlash among liberal, leftwing voters at a crucial stage in the campaign.

McCrory, who now lives in Ayrshire after his faction of the UDA was defeated in an internal feud, said he agreed. "The last thing the 'no' camp needs is the sight of hundreds or even thousands of Ulster loyalists marching behind flute bands, waving Orange banners and union jacks on the streets of Scotland," he said. "The case for the union over here is economic not emotional; it's about jobs, it's about the currency, it's not really about flying flags. Loyalists from Northern Ireland should leave Ulster's politics out of this."

The cross-party Better Together organisation banned the Orange Order from taking part in its official campaign as soon it was set up in 2012, sources told the Guardian, fearing it would inflame sectarian tensions or polarise voters.

Henry Dunbar, grand master of the Grand Orange Lodge of Scotland, which he said has around 40,000 members, insisted the march would have a "carnival atmosphere", and would promote a positive image of Britishness. "It will be very much about promoting the union: we're proud to be Scottish but we're also very proud to be British," Dunbar said.

"Our members feel very strongly [about a no vote] and our members are really up for it."

He said McCrory was absolutely correct that militant loyalists – those who support terrorist groups or those linked to violent protests in Belfast – should not take part.

He confirmed the Grand Orange Lodge of Ireland and the Apprentice Boys of Derry, a Protestant society which had violent clashes with republican groups during the Troubles, were to play a prominent role in the event. "It will be by invitation only," he said. "There won't be any loyalist groups. [ We] wouldn't want it to be contaminated by other people's struggles."

Professor Graham Walker, professor of political history at Queen's University Belfast and a Scot, said there was a danger that soft pro-union voters could be driven into the yes camp if the anti-independence campaign became too equated with its loyalist brand in Ulster.

"Ulster unionists crave security and solidarity, and they are likely to desire a vigorous flag-waving defence of the union and Britishness. Many of them possess an Ulster-Scots sense of identity and they are anxious about ties being broken or weakened. This sense of anxiety, insecurity and perhaps desperation are not the notes the no camp wants to strike."