Why MICR Code is Required

Author: Source Technologies

While overall check use has declined over the past 10 years, business-to-business check payments are still going strong, and even increasing in value. When handling business transactions, it is important to ensure you are using a MICR printer when printing checks. The MICR number is still essential for preventing check fraud and quickly facilitating routing information.

What Is A MICR Number? 

MICR stands for magnetic ink character recognition and is known as the line of numbers that appear at the bottom of a check. The MICR line is a group of three numbers, which are the check number, account number, and bank routing number. MICR numbers are readable by individuals and computers, however their special font combined with magnetic ink helps to prevent check fraud. There are two major MICR fonts in use: E-13B and CMC-7, however E-13B is the standard when printing checks in the US. Below is an example of the E-13B MICR Font. 


MICR & Check Clearing in the 21st Century

Before Check 21 legislation, checks required magnetic ink so that, as the paper check moved through the clearing process, banks’ MICR reader/sorters could automatically “read” the account number and routing number on the check.

So what is the MICR line or MICR number used for? Today, the vast majority of checks are cleared by scanning them and using the image of the check to move through the payments system or converting them to an ACH electronic transaction (Check 21). Where the system used to rely on many scans and “reads” of the characters on a check, now the MICR read happens just once, to capture the information during its transition to an electronic format.

Businesses now have the option to print their own documents and official checks utilizing  magnetized toner to create specialized identifiers that track a payment through the banking system. This can help businesses reduce costs when buying checks directly from the bank as well as give them more added convenience. 

Is MICR or Magnetic Ink Required For Printing Checks?

In more recent years, there have been questions in the industry about the need for the magnetic ink on checks. Some may think it’s cost-effective to avoid printing checks with the more expensive magnetic ink. However, the magnetic ink has always been legally required on the check as a payment instrument and that requirement still exists today. According to the Federal Reserve and the Accredited Standards Committee X9 (for financial industry standards), in order for a check to be treated as a cash item, it must contain MICR.

If your business is currently printing its own checks you must use proper MICR toner to ensure they are compliant with the processing procedures of the banking system. 

Our MICR Check Printing Solutions

At Source Technologies, we understand the regulations in place that govern the financial industry and your check printing operations. With magnetic ink required for check legitimacy, it is critical your business complies with the standards. Contact us today to learn how our MICR check printer solutions and MICR toner cartridges offer your business the most security available today.