What is IFSC-MICR codes-SWIFT Codes

Using a bank IFSC code number helps pinpoint the beneficiary bank branch, making transfers seamless. The MICR Code allotted to a bank branch is printed on the MICR band of cheques issued by bank branches. IFSC and MICR codes have a very similar purpose — they both help to identify individual bank branches in India. Through the RBI (Reserve Bank of India), Federal Bank assigns a unique IFSC code to each of its branches. This makes each branch easy to identify, especially when processing online transfers on the NEFT, IMPS and RTGS networks. It is a unique identifier issued by the Reserve Bank of India (RBI) to the branches of banks that participate in Electronic Clearing Services (ECS).

To find a bank code in the U.S., refer to your bank account statement, mobile banking app, or the bank’s lookup page for routing numbers. All banking procedures what are ifsc and micr codes can now be carried out online utilising IFSC codes. The unique codes that each bank and its branches supply, ensure the transaction’s security.

The code is 9-digits and identifies the city, bank, and branch of a specific Indian financial institution that a cheque originates from. In India, MICR codes are specifically used in the process of clearing physical cheques. They identify the city, branch, and bank where a check payment originates from. In conjunction with high-speed cheque-clearing technology, the MICC allow cheques to be processed quickly.

  1. IFSC is an acronym for Indian Financial System Code while MICR code stands for Magnetic Ink Character Recognition code.
  2. Also, it helps in streamlining and automating various banking processes like NEFT, RTGS, and IMPS, which are used for interbank fund transfers.
  3. Learn how to find the right IFSC code for banks across India, and get a faster and cheaper way to remit money with Wise.
  4. In addition to the official IFSC website, which includes a code finder, you can access IFSC codes.

Giving out your bank IFSC code is safe, as it’s required by the other party to send you money. Sharing both the account number and IFSC only allows a person to deposit money into your account. Without additional authentication, they cannot withdraw or misuse funds. However, always ensure you are sharing information with trustworthy entities. RTGS caters to high-value transactions, typically above ₹2 lakh. The system processes these transfers instantaneously, leveraging the code to accurately route the funds.

The Reserve Bank of India assigns each bank branch an eleven-digit number known as the Indian Financial System Code (IFSC) in order to identify it. The unique number is created using both the alphanumeric code and the special identifier for a particular bank branch. The bank IFSC code is required for real-time gross settlement (RTGS), prompt payment service (IMPS), and the National Electronic Fund Transfer (NEFT). Without the bank IFSC code, it is impossible to make a financial transaction, as the IFSC code specifies the bank branch where the transaction will be conducted. When transferring funds from one bank account to another, this code is required to be entered. No matter how close they are in proximity to one another in a given city, branches of the same bank will never share a single unique code.

What Is Magnetic Ink Character Recognition Used For?

To make this process faster banks and financial institutions are taking help of few codes to simplify and automate there processes. Instead, the MICR is used for clearing physical cheques while the SWIFT is used for sending international transfers to a specific bank. IFSC codes are maintained by RBI (Reserve Bank of India) and it has complete list of all the branches of all the banks that provide online fund transfer facility to their customers.

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The contents are generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. The information is subject to updation, completion, revision, verification and amendment and the same may change materially. IDFC FIRST Bank shall not be responsible for https://business-accounting.net/ any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information mentioned. Please consult your financial advisor before making any financial decision. Where an 8-digit code is given, it may be assumed that it refers to the primary office.

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An MICR Code, short form for Magnetic Ink Character Recognition, is a tool that uses the technology to read and interpret an encoded text allotted to a specific bank branch. Its primary functionality includes hassle-free and efficient clearance of cheques and vouchers. Furthermore, the MICR Code also assists in identifying Electronic Clearing System (ECS)-friendly bank branches. MICR is Magnetic Ink Character Recognition that facilitates processing of cheques. The code makes it possible to process thousands of cheques easily which was a big headache previously.

SWIFT code

The first three digits of the MICR represent the city code which indicates the city in which the bank branch is located. In most of the cases it is the first three number of the PIN CODE. The next three digits represent the bank code i.e. the identity of the bank and the last three digits represents the bank branch code i.e the identity of the location of the bank branch. IFSC is a 11 digit code The first four characters of this alphanumeric code disclose the name of the bank.

Select your bank from the list, input your branch name, and get your code. Upon selecting your bank, the website will display a list of all branches with their respective IFSC codes. Check the top left corner of any cheque leaf to find the IFSC code.

A BIC provides the record for transactions between institutions. All Swift codes consist of 8 or 11 characters, and enable the transfer of money between banking institutions, as well as international wire transfers. It is a nine digit numeric code where each three digits signifies some important information about the bank and the transaction.

IFSC Code in India

Many a times, people get confused between IFSC and MICR code, hence we will explain the differences between the two in this post. Additionally, MICR is 9-digit numerical number while IFSC codes are 11-digit alphanumeric. The Indian Financial System Code is a combination of alphabets and numerals, with the first four characters representing the name of the bank. The fifth character is always a zero, and the remaining six characters are either numbers or alphabets that denote the branch code. You can usually find your bank’s IFSC and MICR codes in your cheque book, or on the front page of your passbook.

If you want to transfer funds instantly use RTGS or IMPS instead. The MICR Code found in the check details refers to Magnetic Ink Character Recognition. The MICR is used when a branch participates in the ECS Credit Scheme, allowing account holders to set up direct deposits and automated withdrawals like standing orders. Besides SWIFT code,  people refer to the BIC code as bank identifier code, bank identification code, business party identifier, and business identifier code. The routing number is also printed on the top right of the check, in a different format shown as a fraction.







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