The Indian Financial System Code or the IFSC code, is a unique number that is held by every branch of a bank. The code is a set of multiple alphabets and numbers forming a group of 11 numbers. Every bank and its envy branch have its own different code that is used for baking purposes. An IFSC code is used for inter or intra bank transactions, involving NEFT, RTGS, and IMPS.
Also, without an IFSC code, the transaction cannot proceed. This code is mentioned at the checkbook and the passbook of a person who has an account in a bank. The zeros mentioned in the middle of the IFSC code are kept for the future purpose of modification of the IFSC code. With the help of an IFSC code, the errors in the processing of transactions are avoided.
MICR code is directed by a magnetic ink character recognition system. This is used for verification of documents. It is generally used to examine the authenticity of legal documents like checks and legal statements. This code is printed over the check book at the bottom of the individual cheque. This code and IFSC code are connected to each other for excessive privacy while making online transactions.
MICR code is used to pass cheques that check that the cheque belongs to the respective holder. The bank scans the code on the cheque, and the Character recognition technology is used for the purpose. The MICR code can be utilised to get the information regarding the holder of the respective account. For this code, the banks get to know the details like the amount, cheque number, account details.
The initial letter of the IFSC code states the name of the bank. Whereas in a MICR code, the initial three numbers indicate the name of the respective city. Both the codes are generated by the Reserve bank of India and are provided to individual banks.