Nice. I would have thought it the same way 🙂 But I think the self join can be omitted

;WITH Tally(N) AS (SELECT ROW_NUMBER() OVER(ORDER BY (SELECT NULL))

FROM(VALUES(0),(0),(0),(0),(0),(0),(0),(0),(0),(0))a(N))

SELECT A,B,stripped

FROM TXNS b

CROSS APPLY (SELECT (SELECT CASE WHEN PATINDEX('[A-Za-z0-9]',SUBSTRING(B,N,1)) = 1

THEN SUBSTRING(B,N,1)

ELSE '' END

FROM Tally

WHERE N <= LEN(B)

FOR XML PATH(''), TYPE

).value('.', 'VARCHAR(10)') ) c(stripped)

For easier readability we can omit TYPE and value combination as well as we are dealing with only alphanumeric values.