Magnetic Ink Character Recognition MICR Line Overview, How It Works


The photocopied MICR line immediately alerts the teller that the check is fake. The routing number identifies the bank branch that holds the account from which funds are to be drawn. The system was developed by the American Bankers Association (ABA) in the late 1950s and was later recognized as an industry standard by the American National Standards Institute. CMC-7 is mainly used by South America as well as the majority of Europe and other countries scattered around the globe. The barcode functionality allows room for less error when being read by MICR scanners.

  1. The primary purpose of the MICR line is to provide a unique identifier for each check, as well as facilitate faster and error-free processing.
  2. This became the industry standard later, being recognized by the American National Standards Institute (ANSI).
  3. It consists of magnetic ink printed characters of a special design known as either E-13B or CMC-7, depending on the region of the world.
  4. MICR technology guarantees exceptional precision and dependability when reading characters printed with magnetic ink.
  5. As a result, it remains a fundamental technology in the banking industry, even as electronic payment methods become more prevalent.

Incidentally, it is not only machines that can read it, but the printing is also in human-readable type too. The font that is used to print these letters is unique and cannot be faked (both the magnetic ink and the style of the letters). Banks use specialized MICR readers, such as check sorters or scanners, to read and process the MICR-encoded information. These devices can effectively decode the magnetic ink and rapidly process the financial documents, ensuring a smooth flow of transactions and reducing the likelihood of errors. Government Agencies use MICR ink to accurately and securely process important documents, including tax forms, licenses, permits, and other government-related documents.

By the mid-1950s, the Stanford Research Institute and General Electric[15] Computer Laboratory had developed the first automated system to process cheques using MICR. “E” refers to the font https://business-accounting.net/ being the fifth considered, and “B” to the fact that it was the second version. The technology allows MICR readers to scan and read the information directly into a data-collection device.

Usually, these numbers appear at the bottom of a check, but they can also show up somewhere along the left side. The numbers will include the bank’s nine-digit routing number, the 12-digit account number, and the four-digit check number from left to right. Banks and financial institutions use MICR technology to facilitate the processing of checks.

Hence, the use of MICR technology ensured a more well-organized way of document processing. This core characteristic of the check allows data to be captured electronically. It consists of magnetic ink printed characters of a special design known as either E-13B or CMC-7, depending on the region of the world. These special characters are then recognized by high speed magnetic recognition equipment and cleared by a bank. Standards indicating how to print the MICR line were developed as a way to create an industry standard, providing consistency throughout the financial industry. The MICR lines that are printed at the bottom help in the rapid clearing of the cheques that are sent to the central processing centers of the banks at the end of the day daily.

This technology was developed in the middle of the 20th century and is now widely used all over the world. The magnetic ink character recognition allows computers to read, record the information that is printed on the cheques and other banking instruments. This was a system that was created by the American Bankers Association or the ABA, in the 1950s. This became the industry standard later, being recognized by the American National Standards Institute (ANSI).

MICR technology finds application in various sectors and scenarios where checks are used as a form of payment. To achieve optimal readability, checks must meet specific standards and guidelines defined by the American National Standards Institute (ANSI) and the American Bankers Association (ABA). One challenge is the need for proper training and expertise in operating MICR printers. The equipment requires operators who are skilled in handling and maintaining the printers, as well as troubleshooting any issues that may arise during the printing process.

Magnetic Ink Character Recognition (MICR) Devices

Non-MICR checks may incur additional processing fees or delays due to the manual processing required. Non-MICR checks can still be processed, but they may require manual handling and entry. This guarantees the readability and durability of the magnetic characters throughout the check’s lifecycle.

Features of MICR

By being extremely hard to replicate, MICR printing technology has pushed the realm of security. It continues to be the number one safety precaution used in the modern era of printing. Although CMC-7 is technically more accurate, it is often criticized for being much harder to read by the human eye due to its scattered nature within each character. By the mid-50s, the number of checks being widely used and processed increased significantly.

Thus, while the landscape of financial transactions continues to evolve, MICR technology stands firm as a key pillar supporting the banking industry. Check printing software provides a secure system to automate the enterprise check disbursement process. Magnetic ink has become increasingly more available to the public over the years. Especially in the modern era, it’s completely feasible to own a MICR printer for your business to ensure the safety and legitimacy of your documents. With four “gates” per character and over 40 characters per check, a check must flawlessly pass over 160 checkpoints before it can be processed.

Key Considerations for MICR Printing and Equipment

The strange-looking letters that are printed usually on the bottom of the cheques and demand drafts from the banks are printed in special ink that has magnetic properties. These letters help in the identification and faster processing of cheques. Now that you know a little more about how magnetic ink check features work, are you interested in giving it a try? If you want to maintain your company’s financial security, Checkissuing.com is here to help.

It was a notable improvement because it allowed for the mechanization of check processing while making it more difficult to commit check fraud. Since MICR technology helps detect and prevent fraud, banks and other financial institutions use it to minimize losses. The definition of fraud is an intentionally deceptive action that is designed to provide the perpetrator with an unlawful gain. A range of fraud types exists, including tax fraud, credit card fraud, wire fraud, securities fraud, and bankruptcy fraud. A variety of financial documents in the United States are encoded with MICR technology. Credit card invoices, direct mail, coupons used for rebates, and negotiable orders of withdrawal (NOWs) may also use the technology.

When processing a check, it must pass through the machine at a very precise speed. If processed too fast or too slow, it will not be able to be read properly. Very seldom does the MICR reading technology end on a faulty note, as they are proven to have over 96% accuracy when reading checks. E13-B is often criticized for the ‘5’ and ‘2’ characters being too similar in both shape and magnetic properties. The magnetic wavelengths of a misprinted ‘5’ can easily be mistaken for a correct ‘2’, leading to false red flags raised when processing checks.

This technology employs a specific MICR ink or toner, containing iron oxide, enabling a smooth and rapid automated reading of the characters on the MICR line by specialized recogniticion equipment. Consequently, this reduces manual data entry and results in a seamless workflow for banks in handling millions of checks daily. MICR is a technology that uses magnetic ink and special fonts to encode discuss the features and application of an micr and print account and routing information on financial documents, primarily checks. The encoded information can be conveniently read by electronic MICR readers, ensuring faster processing and secure transactions. The MICR line contains essential information, such as the account number, bank routing number, and the check number, which are encoded in a standardized font called E-13B or CMC-7.

There are two types of MICR fonts that are globally accepted, E13-B and CMC-7. If there is even a single discrepancy with the magnetic code, it will raise an alarm for the bank teller to manually inspect the check. Instead of interpreting the entire character as a whole, a MICR reader reads four separate magnetic charges to decode which corresponding number is being inputted. Each character holds two positive and two negative magnetic charges along the linear track. MICR stands for Magnetic Ink Character Recognition and is a technology used to enhance the security of personal and business documents.


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