The Reserve Bank Of India (RBI) has made it compulsory for all the banks to print the MICR code & IFSC code on the bank passbook and account statement of the customers. As of now customers can find both these codes printed on the cheque leafs of the banks. But now RBI has directed banks to make this information available on bank passbook and account statement along with cheque leafs.
As per the RBI guidelines, MICR code is mandatory for all electronic clearing services and IFSC code is required for national electronic funds transfer (NEFT) and real time gross settlement (RTGS) transactions.
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Printing of both MICR code & IFSC code on bank passbook and account statement will help boosting online transactions.
MICR stands for Magnetic Ink Character Recognition, as name suggest it is a character recognition technology which helps in faster processing of cheques. Every bank branch is given a unique MICR code and this helps the RBI to identify the bank branch and speed up the cheque clearing process. You can find a magnetic inks bar codes printed on the bottom of your bank’s cheque leaf.
IFSC (Indian Financial System Code) is a 11 digit alpha numeric code issued by the RBI (Reserve Bank Of India). This is a unique code provided to each bank branch for easy identification of individual bank branches in India. RBI have developed different payment system applications such as RTGS (Real Time Gross Settlement) and NEFT ( National electronic fund transfer) and CFMS (Centralized funds management system) to make all money transactions electronic across India. The banks using electronic payment system, uses this unique code to identify each bank branch in India to make all type of electronic money transactions without any confusion.
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