Difference Between IFSC and MICR

IFSC VS MICR

IFSC

1. IFSC Stands for Indian Financial System Code
2. IFSC Code is an 11-digit alphanumeric code printed at the mid-bottom of the cheque
3. IFSC or IFS code is required while making online transactions using IMPS, RTGS or NEFT
4. It is assigned by the RBI to each branch of every bank in India
5. It is helpful in identifying branches of various banks
6. Net Banking transactions using NEFT, IMPS and RTGS, cannot be completed without a valid IFSC Code
7. IFSC code is helpful for enabling the RBI to track and manage all the financial transactions being done electronically in the financial and banking system
8. This is a 11-digit alphanumeric code to identify every bank branches which are participating in RTGS-NEFT system in India in a unique manner, where:

• First 4 characters of IFSC code represent the name of the bank
• Next digit is 0 (the 5th digit)
• Last 6 digits represent bank location

MICR

1. MICR stands for Magnetic Ink Character Recognition
2. It is a 9-digit code printed at the mid-bottom of the cheque
3. In India, MICR based cheque clearing system was introduced in 1980 for the first time
4. MICR Code is printed in a unique magnetic ink usually iron oxide which is readable by machine
5. Every bank branch is assigned a unique MICR code
6. It is important in ECS Based Clearing System
7. Cheque reading machine reads the MICR code and processes the cheque automatically
8. It helps the RBI to identify the bank branch and speed up the clearing process hence reducing the scope of error
9. This is a 9 digit code to identify the location of the bank branch, where:

• First 3 characters represent the city of the bank
• Next 3 digits indicate the bank
• Last 3 show the branch