When you look at a check or many certain other kinds of financial documents, you’ll notice some fairly strange, futuristic-looking characters in certain positions. On a standard check, these characters appear along the bottom of the check, and usually contain information such as the routing number, the account number, and the individual check number. This is called the MICR line, and the technology behind the unique MICR font dates back to the 1950’s. During the 50’s, and increasing demand for consumer and business checking accounts led major American financial institutions to scramble for a more efficient and accurate way of processing the exploding volume of checks that they were having to be responsible for.
Many of the world’s largest countries with the most robust economies use the same MICR font, known as E-13B. E-13B characters are the official MICR font is the United States, Canada, Australia, the United Kingdom, Japan, and India. In the aforementioned countries, the E13-B information needed by clearing houses and banks is printed in a magnetic ink near the bottom of the document. After the checks or financial documents are printed, they then are mechanically processed and electronically sorted through a special reader-sorter machine. This machine magnetically reads required information about the check including the amount of the check, account number, institution upon which the check was drawn and other miscellaneous transaction codes. This information is used by the reader sorter machine enabling an electronic sort of the checks for routing purposes.
The E-13B characters are read several times, at extremely high speeds; therefore, for MICR to work successfully, the characters must be accurately printed on a document according to precise specifications and must be able to withstand the abrasive reader-sorter process. These specifications include where on the document the MICR characters can appear, the thickness and grade of the paper being used for the document, the angle or skew allowable within the character line, and required traits of the individual characters themselves.
The reason why there are such stringent accuracy standards has to do with science behind how the MICR reading process takes place. The magnetic signals emitted by the MICR characters printed by MICR toners create magnetic waves that can then be detected by the sorter-reader machine. The peaks and valleys of these waves must be in the correct grid, and be of the right height and depth for the machine to accurately ready the information. Additionally, the MICR toner must contain the right percentage of iron oxide, as a signal that is too strong or too weak will lead to the reader being unable to process the information on the document.
While it is not necessary for the average person to understand the process that allows banks and financial institutions to process their checks, the technology used in the Magnetic Ink Character Recognition (MICR) process has allowed our financial system to grow to the size that is today.
