MICR (Magnetic Ink Character Recognition) Code

As we all know that the bank is a financial institution that accepts cash deposits, pays interest, offers various kinds of loans, and sometimes acts as an intermediate during any financial transactions or other services.

During the transfer of the amount, many people use cheque as an instrument for this.

It is a document that orders the bank to pay the amount specified in it from a person’s account to the person whose name is mentioned in the issued check.

A cheque consists of cheque number, city code, bank code, date, amount and MICR code, etc.

In this article, we will discuss the MICR code in detail.

What is MICR (Magnetic Ink Character Recognition) code?

It is a code printed on cheques by using a technology called MICR (Magnetic Ink Charter Recognition technology). It is an old system mainly used for processing and clearance of cheques and other documents. There are two major MICR fonts commonly used they are E-13B and CMC-17.

MICR characters are printed on documents in either one font using the magnetizable ink or toner which contains iron oxide.

Every bank branch is given with different MICR code by the Reserve Bank of India (RBI). They also ordered to all banks to print the MCIR codes of branch on cheques issued by branches to their customers.

There are numerous advantages of using MICR such as ease of handling bulk cheques, very high accuracy, and very secure, etc.

How MICR Works?

MICR code is a nine-digit code that will be located at the bottom of a cheque next to the cheque number. In which each three-digit denotes various information about the bank and the transaction.

The first three digits of MICR code represents city code, the next three digits represent the bank code and the last three digits represent the branch code of the bank. The format of the MICR code is illustrated below.

 How MICR Works?

The numbers in MICR code is printed with a special type of Ink that has magnetic character and absorb it and emits the magnetic signal.

When the cheque witnessed scanning and emits the magnetic signal and each character produces a unique waveform that is read and translated by the MICR reader.

MICR provides a secure, high-speed method of scanning and processing information.

How to Check the MICR code of the Bank?

What is MICR, Where it is Located

We can find the MICR code of any bank in cheques, by visiting the official website of the bank and it is also available on RBI’s official website.

  • By referring the cheque

We can find the MICR code of the bank in a cheque that will be located at the bottom of a cheque next to the cheque number.

  • By visiting the bank’s official website

We can get the MICR code of the bank by visiting its official website by providing with necessary details they ask like state, district, and branch.

  • By the website of Reserve Bank of India (RBI)

We can find the MICR code of each and every bank branch in India by giving details like bank name, branch area and branch.

What are the uses of the MICR Code?

One of the major purposes of IFSC code is to enable the identification of cheques and fast processing, it also used for processing and clearance of cheques and other documents.

In addition, it helps to identify the bank and branch participating in Electronic Clearing System (ECS).

Advantages of MICR

There are many advantages to MICR they are:

  • MICR can handle information with high accuracy.
  • Fast processing of information.
  • Provides greater security compared to OCR technology.
  • Fewer errors due to no manual inputs.

Disadvantages of MICR

In spite of all numerous advantages there some disadvantages of MICR some of them are listed below:

  • It can only recognize only 10 digits and 4 digit special characters.
  • Alphanumeric characters are not used.
  • It more expensive method for data entry.

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