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written by | April 1, 2022

All You Need To Know About IFSC Code

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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. In addition to the four characters that serve to identify the bank, six more characters are used to designate each of the bank's branches. The number zero is the fifth character.

Did you know?

IFSC codes are created and designated through the head office of the financial foundation by the RBI. You can visit the RBI site to get the IFSC Code for your ideal bank branch.

IFSC Code: Some Key Features

Bank names are represented by the first four alphabetic letters of the International Financial Services Code (IFSC), whereas branch names are represented by the last six characters of the code, which are usually numeric but can also be alphabetic and identify a branch location. There is absolutely no purpose for the fifth character, which is the number 0 (zero), in any way. Bank names are represented by the first four alphabetic letters of the International Financial Services Code (IFSC), whereas branch names are represented by the last six characters of the code, which are usually numeric but can also be alphabetic and identify a branch location. Five has been set aside for future usage as the fifth character (0).

Also Read: All About UPI– United Payments Interface

Difference Between IFSC and Credit Card IFSC Code

It is critical to understand the differences between credit card IFSC and branch IFSC when conducting online transactions in India. The Indian government introduced the 11-digit IFSC system, which is similar to the one used by SWIFT (the Society for Worldwide Interbank Financial Telecommunication), to avoid conflicts that could arise as a result of online fund transfers encountering errors, resulting in funds being credited to the wrong account, risk of transaction failures, and so on. The IFSC code serves as an identifier for each bank and branch in India. Since this type of IFSC is used exclusively for credit card payments, banks cannot have more than one credit card IFSC, unlike branch IFSCs, which are used to exchange funds.

Credit cards do contain a bank IFSC code. If the card were issued by a bank, you would be given the IFSC code. To receive the IFSC code, either visit the bank's website or contact them directly. To add a credit card as a beneficiary using NEFT, you must have the credit card's IFSC code.

MICR Code: Magnetic Ink Character Recognition Code

MICR is an abbreviation for Magnetic Ink Character Recognition. The major aim for this new technology is paper-based documents stored in a financial database, which is a significant step forward. You'll be able to view it on a check. MICR is on par with the International Financial Services Commission (IFSC) regarding fund transfer security.

Banks use MICR codes meaning in conjunction with Character Recognition Technology (CRT) to validate checks before they may be cleared for payment. MICR technology is also used in the production of other bank papers.

Bank IFSC Code Format

Each bank branch's IFSC code is 11 digits long and is composed of the bank's initials (A-Z) and the fifth digit (a zero). The IFSC code can be found on the bank's check leaf. The Indian Reserve Bank (RBI) is responsible for allocating IFSC codes to financial institutions in the country. The IFSC code can also be found on the bank's and the RBI's official websites.

What Is a MICR Code?

On the bottom of each check is a handwritten MICR code. This document contains the cheque numbers, the bank code, and account information. Additionally, it features a control indication. In comparison to other similar technologies, such as barcodes, MICR stands out due to its ease of reading and recognition by humans.

MICR Code Format

The first three characters of a MICR code represent the city, the next three represent the bank, and the final three represent the bank's branch code. MICR codes consist of nine digits.

MICR codes (Magnetic Ink Character Recognition technology) are the codes written on cheques utilising MICR technology. They appear on the bottom of a cheque leaf next to the check number, and it is frequently printed on the first page of savings account passbooks.

IFSC Code Search: Bank's Branch

The IFSC, or Indian Financial System Number, is a unique alphanumeric code that identifies bank branches that participate in NEFT and RTGS transactions. Depending on the bank, the IFSC code might be found on the passbook or chequebook.

A customer service representative or the bank's website can provide you with the IFSC code for any branch in the world. According to the HDFC Bank South Delhi branch: 

  • IFSC codes can be obtained by calling the branch and asking for them. 
  • It is found in the bank's cheque book or passbook, as previously indicated.

Other sources, such as the Reserve Bank of India's official website, may have information about IFSC codes. According to RTGS/NEFT, it is listed on the network as one of the participating institutions.

For example, on the PolicyBazaar.com HDFC bank IFSC page, you can discover the IFSC code for HDFC Bank.

Choose 'search HDFC bank code by branch' from the drop-down menu to get started with your search.

You can select a state from the drop-down menu and enter the essential information, such as the district and branch, by clicking on it.

Entering this information will bring up a list of all the bank branches' phone numbers and email addresses.

Also Read: Meaning and Need for a Cancelled Cheque

How Does the IFSC Code Work?

In India, electronic payments are simplified by the use of the country's IFSC (Indian Financial System Code) (IFSC code or IFSC). This code is used to identify bank branches that are members of the National Electronic Clearing System (NECS) or the National Payments Corporation of India (NPCI).

In this instance, finding an IFSC code is a cinch. The IFSC code for your bank branch can be found by looking at your passbook.

You can get the code from the internet without creating an account. In addition to the official IFSC website, which includes a code finder, you can access IFSC codes.

The Necessity of Indian Financial System Code

Finances must shift funds from savers and investors for the economy to be healthy and stable. Nonetheless, how does the financial system ensure that your hard-earned money is directed to the most productive investors rather than the least productive investors? There must be a government-controlled banking system in place. India's Reserve Bank of India (RBI) is responsible for regulating all financial businesses operating in the country. Every RTGS, NEFT, IMPS, and CFMS financial transaction may be easily tracked by RBI using a single code (IFSC). Using the IFSC code eliminates the possibility of making a mistake when transferring money. If you're using RTGS, IMPS, or NEFT to send money to someone else, you'll need their IFSC code to ensure the money goes to the right place.

Conclusion

The Indian Financial System Number (IFSC) is an alphanumeric code that facilitates electronic payments in India. Depending on the bank, the IFSC code might be located on the passbook or the chequebook. Banks employ Character Recognition Technology (CRT) to verify the validity of a check before it may be cashed. As opposed to barcodes, MICR can be read and differentiated by people extremely quickly. The Indian Reserve Bank (RBI) is responsible for allocating IFSC codes to financial institutions in the country.

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FAQs

Q: When a branch is changed, the IFSC code remains constant?

Ans:

Each bank branch is granted a unique IFSC code. Along with an account number, this alpha-numeric code serves to identify a transaction. However, after a period of time, the bank IFSC codes of amalgamated branches cease to exist, even if an individual's account number stays the same.

Q: Is it safe to enter the IFSC code?

Ans:

All banking procedures can now be carried out online utilising IFSC codes. The unique codes that each bank and its branches supply, ensure the transaction's security. As a result, there is no possibility of fraud or theft. With IFSC codes, security breaches are virtually impossible.

Q: Is an IFSC code required to send money?

Ans:

Yes, because payments cannot be made online without a valid IFSC code.

Q: What is the Indian Financial System Code?

Ans:

Online fund transfers are conducted using NEFT, RTGS, and IMPS, all of which utilise the Indian Financial System Code, a unique 11-digit alphanumeric identity (IFSC). The bank  IFSC code is located on the check leaf of the bank. The Reserve Bank of India (RBI) is responsible for allocating IFSC codes to the country's financial institutions.

Q: What is the purpose of an IFSC number?

Ans:

The IFSC code is used by all electronic payment systems, including RTGS, NEFT, and the Centralized Funds Management System (CFMS). This code is required when transferring funds from one bank account to another.

Disclaimer :
The information, product and services provided on this website are provided on an “as is” and “as available” basis without any warranty or representation, express or implied. Khatabook Blogs are meant purely for educational discussion of financial products and services. Khatabook does not make a guarantee that the service will meet your requirements, or that it will be uninterrupted, timely and secure, and that errors, if any, will be corrected. The material and information contained herein is for general information purposes only. Consult a professional before relying on the information to make any legal, financial or business decisions. Use this information strictly at your own risk. Khatabook will not be liable for any false, inaccurate or incomplete information present on the website. Although every effort is made to ensure that the information contained in this website is updated, relevant and accurate, Khatabook makes no guarantees about the completeness, reliability, accuracy, suitability or availability with respect to the website or the information, product, services or related graphics contained on the website for any purpose. Khatabook will not be liable for the website being temporarily unavailable, due to any technical issues or otherwise, beyond its control and for any loss or damage suffered as a result of the use of or access to, or inability to use or access to this website whatsoever.
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Disclaimer :
The information, product and services provided on this website are provided on an “as is” and “as available” basis without any warranty or representation, express or implied. Khatabook Blogs are meant purely for educational discussion of financial products and services. Khatabook does not make a guarantee that the service will meet your requirements, or that it will be uninterrupted, timely and secure, and that errors, if any, will be corrected. The material and information contained herein is for general information purposes only. Consult a professional before relying on the information to make any legal, financial or business decisions. Use this information strictly at your own risk. Khatabook will not be liable for any false, inaccurate or incomplete information present on the website. Although every effort is made to ensure that the information contained in this website is updated, relevant and accurate, Khatabook makes no guarantees about the completeness, reliability, accuracy, suitability or availability with respect to the website or the information, product, services or related graphics contained on the website for any purpose. Khatabook will not be liable for the website being temporarily unavailable, due to any technical issues or otherwise, beyond its control and for any loss or damage suffered as a result of the use of or access to, or inability to use or access to this website whatsoever.