What is MICR Code?

The importance of having accurate and up-to-date information on various bank documents, such as a mobile app, website, passbook, or cheque book, cannot be overstated. This is because these details are frequently used to complete financial transactions. For instance, an IFSC code is necessary to identify a specific bank branch and is required when making electronic fund transfers through NEFT, RTGS, or IMPS. Similarly, a debit card is used to access funds through online, offline, or ATM transactions.

 In this article, we will explore the role of the MICR code on a cheque and define what it is.

What is MICR Code?

“Magnetic Ink Character Recognition” (MICR) is a technology that uses a 9-digit code printed at the bottom of a cheque to quickly and accurately identify and process it. In addition to speeding up the processing of cheques, MICR has other features such as:

• MICR is located at the bottom of the cheque
• It includes bank-specific information such as the bank code, account details, cheque number, and amount
• MICR codes are composed of various characters
• Unlike IFSC codes, MICR codes are widely accepted for cross-border fund transfers
• MICR codes cannot be easily copied due to their unique font and use of magnetic ink
• Indian banks each have their own MICR codes

What is the Format of a MICR Code?

A MICR code is a nine-digit identification code used to identify banks and branches participating in the Electronic Clearing System (ECS). The digits in groups of three within the code represent specific information about the bank.

• The first three digits of the MICR code represent the city code.
• The middle three digits represent the bank code.
• The final three digits represent the branch code.

Where Can I Find the MICR Code?

The MICR code can be found in the following ways by an account holder:

• The MICR code can be found at the bottom of the cheque.
• The Reserve Bank of India’s official website provides access to this code.

How Does the MICR Line Work?

MICR codes are printed using magnetic ink, which helps to prevent duplication and allows computers to accurately read and decode information such as cheque numbers, account numbers, and routing numbers from MICR lines. In addition to preventing duplication, the use of magnetic ink allows computers to accurately read characters that may have been covered by bank stamps, cancellation marks, signatures, or other types of marks or inks.

Conclusion

The information provided by a bank through its mobile banking application, website, or banking kit serves a specific purpose and is used by both the bank and its users to facilitate and record transactions. This information is accessed through various mediums, such as mobile apps, websites, or banking kits, to make it easier to complete financial transactions.