IFSC Code also can be used at the time of purchasing mutual funds or insurance through NetBanking. As the National Clearing Cell of Reserve Bank of India monitors all transactions, IFSC Code helps RBI to keep a track of various transactions and execute fund transfer without any hassle. MICR is an acronym for Magnetic Ink Character Recognition. Primarily, this innovative technology authenticates the legality and credibility of paper-based document(s) in the banking database.
The information on the cheque is processed using MICR reader which updates accounts and performs various other processes. The MICR number allows computers to rapidly internalize a check number, routing number, account number, and other numbers or information from printed documents, such as a personal check. The MICR number, which is sometimes confused with just the account number, is printed with magnetic ink or toner on a check, usually in one of two major MICR fonts. The magnetic ink allows the computer to read the characters on a check even if they have been covered with signatures, cancellation marks, or other marks. (Magnetic Ink Character Recognition) The machine recognition of numeric data printed with magnetically charged ink.
MICR is at par with IFSC as far as the security of a fund transfer is concerned. Icici MICR (Magnetic Ink Character Recognition) code is a machine readable code used for processing and clearance of cheques.
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A routing number (or routing transit number) is a specific nine-digit numerical code, which banking and other financial institutions use for the purpose of clearing funds and/or processing checks in the U.S. As it appears on the front of a check check, the routing number represents the bank that holds the account from which funds are to be drawn. Wire transfers and direct deposits often rely on routing numbers. The format for the bank code and bank account number is country-specific.
It is used to identify the bank branch to which the cheque belongs. When a cheque goes for clearing, this code is read by a magnetic reader and then automatically sorted. MICR technology speeds up the whole process compared to manual reading and sorting. MICR code for Icici Bank is present at the bottom of every cheque leaf. Cheque Truncation System (CTS) or Image-based Clearing System (ICS), in India, is a project of the Reserve Bank of India (RBI), commenced in 2010, for faster clearing of cheques.
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IFSC code is developed to initiate electronic money transfer between banks within India, MICR is a Magnetic Ink Recognition technology for making cheque processing faster and simpler. IFSC is a 11 digit code The first four characters of this alphanumeric code disclose the name of the bank.
The accountholders can easily check the IFSC code of their bank/branch on the Reserve Bank of India’s website. Internet banking transactions for transferring funds, using NEFT, IMPS and RTGS, can’t be initiated without a valid Indian Financial System Code. IFSC (Indian Financial System Code) is a 11 digit alpha numeric code issued by the RBI (Reserve Bank Of India). This is a unique code provided to each bank branch for easy identification of individual bank branches in India.
With IFSC Code, online money transfer has become easier and hassle-free. RBI has assigned these codes to the bank branches to perform NEFT, RTGS and IMPS fund transfer in a smooth way.
The fifth character has been kept zero to accommodate expansion of branches. Last 6 characters in the code tell the exact location of the bank. The IFSC code is even printed on the cheque books issued by all banks and one can know the IFSC code by looking at the cheque slip.
- IFSC is an acronym for Indian Financial System Code.
- IFSC code is a unique eleven-digit number which is a combination of alphabets and numerals.
- It is used to transfer funds online for NEFT, IMPS and RTGS transactions.
RTGS is one of the main payment and settlement systems in India. To make a payment using RTGS, one requires details like name of the account holder, account number and the IFSC code of the bank. Money can be transferred from one bank account to another safely using RTGS. IFSC code is often referred to as RTGS code or NEFT code for the same reason. An RBI regulated entity, National Payment Corporation of India (NPCI), has developed an instant payment system known as the Unified Payment Interface (UPI).
The banks using electronic payment system, uses this unique code to identify each bank branch in India to make all type of electronic money transactions without any confusion. IFSC code is used by electronic payment system applications such as real-time gross settlement (RTGS), NEFT and Centralised Funds Management System (CFMS). This code is mandatory for fund transfers from one bank account to another. Every bank branch will have a unique code and no two branches (even of the same bank) will ever be the same. One of the benefits of the magnetic ink character recognition line is its ability to quickly facilitate the use of routing numbers.
It is used to transfer funds online for NEFT, IMPS and RTGS transactions. Usually, the IFSC code can be found on the cheque-book provided by the bank.
How does an MICR work?
Magnetic ink character recognition (MICR) is the line of numbers that appears at the bottom of a check. The MICR line is a group of three numbers, which are the check number, account number, and bank routing number.
IFSC is an acronym for Indian Financial System Code. IFSC code is a unique eleven-digit number which is a combination of alphabets and numerals.
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It can also be found on the front page of the accountholder’s passbook. The IFSC code of each bank branch is assigned by the Reserve Bank of India.
What is MICR of bank?
MICR (magnetic ink character recognition) is a technology used to verify the legitimacy or originality of paper documents, especially checks. Special ink, which is sensitive to magnetic fields, is used in the printing of certain characters on the original documents.
To know how IFSC Code works while transferring money, let’s take an example here. The IFSC code of HDFC Saket, New Delhi branch is HDFC .
Every bank branch is given a unique MICR code and this helps the RBI to identify the bank branch and speed up the cheque clearing process. You can find a magnetic inks bar codes printed on the bottom of your bank’s cheque leaves.
Abbreviated as Indian Financial System Code, IFSC is an 11-digit alphanumeric code that is used to identify the bank branches that participate in various electronic monetary transactions like NEFT or RTGS. One can find the IFSC code either in his/her bank passbook or on the chequebook. The image below can help you understand better. Electronic funds transfer in India is facilitated by an alpha-numeric code called the Indian Financial System Code (IFS Code or IFSC). MICR (Magnetic Ink Character Recognition), as name suggest it is a character recognition technology which helps in faster processing of cheques.
UPI operates over IMPS infrastructure and allows instant transfer of money between any two bank accounts. In case you are registering with the service for the first time, you’ll need to create a 4 to 6-digit UPI Pin (Personal Identification Number). You will have to enter the UPI PIN to perform all UPI transactions. UPI payment method allows fund transfer offline and online. Moreover, irrespective of the bank’s working hours, an individual can instantly transfer funds anytime.
MICR is a technology used in the recognition of originality of the document with the help of special ink and characters. They are printed on the bottom of bank cheques consisting of nine digits. First three digit signifies about the city code, next three about represent bank code, and last three tells about the branch code. Afterwards, you need to add the beneficiary to your account to whom you want to transfer the money. To do this, you will need the beneficiary’s name, her/his bank account number and the IFSC (Indian Financial System Code) of her/his bank branch.
IFSC stands for Indian Financial System Code. The IFSC code comprises eleven characters and is used to identify the bank and its branch. it is one of two main payment and settlement systems in India.
IFSC can be either found on the bank statement or on the cheque leaf. The sample cheque which uses MICR technology is depicted in the figure-1.