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History of MICR - Magnetic Ink Character Recognition

While the MICR font is clearly visible on every paper check processed today, that wasn’t always the case.

Prior to the mid-1940s, checks were processed manually using either the Sort-A-Matic or Top Tab Key method. As the number of checks increased, finding an automated way to process them became essential. The development of standards that could be used to ensure uniformity in financial institutions across the country was also needed. By the mid-1950s, the Stanford Research Institute and General Electric Computer Laboratory had developed the first automated system to process checks — MICR.

What exactly is MICR?

MICR stands for Magnetic Ink Character Recognition. MICR is a process by which documents are printed using magnetic ink/toner and special fonts to create machine-readable information for quick processing of paper-based payments. The 65 digit line of numbers and characters that make up the MICR line is printed in the area 0.625 inches from the bottom edge of a check.Check example with MICR

The special MICR font that is used in North America is known as E-13B. When positioned in the proper location, the characters printed in the MICR font allow check readers to scan the appropriate bank and customer account information to facilitate automated check clearing by financial institutions.

Back to the past: the adoption of MICR

MICR - including the E-13B font printed in magnetic ink - was established as the standard for negotiable documents by the American Bankers Association (ABA) in 1958. By the end of 1959, the first checks had been printed using magnetic ink. The ABA set MICR as its standard because machines could read MICR accurately and MICR could be printed using existing technology. In addition, documents printed with MICR technology remained readable, even through overstamping, marking, mutilation and more.

In 1963, the American National Standards Institute (ANSI) recognized the ABA’s standards as the American standard for MICR printing. Although compliance with the standards is voluntary in the U.S., the financial industry considers them to be the definitive method by which to determine the acceptable quality of a negotiable document. Financial institutions, businesses, government agencies or other organizations who do not meet the ANSI MICR standards may be forced to pay additional fees and charges.

MICR today 

To this day, businesses still depend on MICR technology for the security needed to combat the threat of check fraud, especially in the digital age.

In addition to manufacturing, printing and issuing checks, MICR technology is also used to print financial forms and related documents, such as image replacement documents (IRDs), negotiable orders of withdrawal, bank control documents, credit card invoices, insurance payment booklets and direct mail or instant rebate coupons.

Want to keep reading about MICR? You can learn more here. Interested in seeing what we offer? Check out our check options, MICR toner & MICR printers.  

*This blog post was originally published on October 2011, it was updated and republished on May 28, 2019.

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