MICR Full Form

Magnetic Ink Character Recognition (MICR) is mainly used to recognize and handle cheques. The series of characters at the left-hand bottom corner of a check is its MICR. It is made up of three sets of numbers: the check number, the customer’s account number, and the bank routing number.

What is MICR?

The full form of MICR is Magnetic Ink Character Recognition. Magnetic Ink Character Recognition is a technology used for the recognition and processing of characters printed with magnetic ink. It involves encoding information using a specific set of characters that can be easily read by machines equipped with magnetic sensors.

Format of MICR Code

In general, the banking sector uses MICR technology to verify the authenticity of the papers and reduce processing and clearance costs for checks and other paperwork. The following information is printed in the MICR code at the bottom of the checks:

• The initial three digits represent the city code
• The next three digits show the bank code
• The last three digits denote the branch code

Characteristics of MICR

• Magnetic Ink: MICR uses specially formulated magnetic ink that contains iron oxide particles. This ink allows the characters to be easily detected and read by magnetic sensors.
• Character Recognition: MICR enables the automated recognition and processing of characters, typically numeric digits and special symbols, printed in a specific MICR font.
• Machine Reading: MICR characters are read by magnetic sensors or MICR readers, which detect the magnetic properties of the characters and convert them into digital data.
• High Accuracy and Reliability: MICR technology provides high accuracy and reliability in reading characters since it is resistant to smudging, fading, or tampering. This makes it suitable for applications that require secure and error-free data capture, such as banking and finance.
• Standardized Format: MICR follows a standardized format defined by international standards organizations, ensuring consistency in character placement, font design, and encoding rules.

How Does the MICR Line Work?

The MICR font, which is created using magnetic ink made from iron oxide, is used to read documents.

• E-13B: It consists of 14 letters, ten decimal digits, and a few unique symbols.
• CMC-7: It has a barcode format and consists of a synchronized set of 15 characters, including five control characters—amount, routing, terminator, internal, and a new character—as well as ten numeric values.

On documents that call for authentication evidence, any one of these fonts may be printed using magnetic ink or toner. Iron oxide is specifically used to prepare the magnetic ink or toner so that readers can quickly collect it.

Features of MICR

• Even if a stamp or sign is placed on top of it, it is still easily recognized. As a result, it is advantageous.
• It is difficult to trace the same ink which makes forging the document very difficult. it creates a very safe and secure network. Since it is difficult to trace the ink used in MICR, forging is impossible, making the network secure.
• This also decreases the mistake rate.
• MICR typefaces that don’t fit these requirements are rejected or denied approval.

History of MICR

MICR technology was first developed in the 1950s as a solution to automate check processing in the banking industry. It was introduced to improve the efficiency and accuracy of check clearing and processing operations. The American National Standards Institute (ANSI) and the International Organization for Standardization (ISO) have established standards for MICR printing, which define the font, character set, and encoding rules.

Advantages of MICR

• MICR technology revolutionized the check processing industry by significantly reducing processing time, increasing accuracy, and enabling automation.
• It allowed banks to process large volumes of checks quickly and reliably.
• MICR’s resistance to tampering and its standardized format also contributed to enhanced security in check processing.

Disadvantages of MICR

• One drawback of MICR technology is it’s relatively high cost of implementation compared to other character recognition methods.
• The specialized ink, magnetic sensors, and MICR readers can be expensive.
• Additionally, the use of magnetic ink limits the flexibility of document design and may require specific printing equipment.
• Advances in digital imaging and optical character recognition (OCR) technologies have also presented alternatives to MICR for certain applications.

Conclusion

It’s important to note that while MICR technology is primarily associated with check processing, it has found applications in other fields as well, such as document sorting, payment processing, and security printing.

Please keep in mind that the specific achievements, advantages, drawbacks, or disadvantages of MICR may vary depending on the particular application or industry in which it is utilized.

MICR – FAQs

1. Where can you expect to see MICR used?

In the banking sector, MICR is mostly used. To make sure no checks have been made, the codes are primarily printed on checks. The bottom of each check has a nine-digit MICR code, the first three of which are the city code, the second three are the bank code, and the final three are the branch code.

2. How is MICR used in banks?

Since the late 1950s, MICR has been in use. It was an important development since it made check fraud more challenging while enabling the automating of check processing. The system was adopted by banks all across the system. This explains why bank checks have such a consistent format. In order for the readers to read the MICR numbers, it must be.

3. What is the main difference between IFSC code and MICR code?

The IFSC Code is used to send money via NEFT and RTGS, which is the primary distinction between the two. On the other hand, just cheque leaves are used with MICR code.