MICR, IFSC Code, Swift code, IBAN Number

Indian Financial System Code (IFSC) is an alpha numeric code designed to uniquely identify the bank-branches in India. This is 11 digit code with first 4 characters representing the banks code, the next character reserved as control character (Presently 0 appears in the fifth position) and remaining 6 characters to identify the branch. The MICR (Magnetic Ink Character Recognition) code has 9 digits and are also used to identify the bank-branch for cheque clearing and online transaction processes. IFSC is being identified by the RBI as the code to be used for various payment system projects within the country, and it would, in due course, cover all networked branches in the country. In due course, when all bank branches participate in electronic payment systems, they would need to have a single identifiable unique code and IFSC would serve the purpose effectively.

In the Structured Financial Messaging System (SFMS), the Indian Financial System Code (IFSC) is being used as the addressing code in user-to-user message transmission. The Payment System Applications such as RTGS, CFMS and NEFT developed by the Reserve Bank of India (RBI) use these codes. The code consists of 11 characters - first 4 characters represent the entity; fifth position has been defaulted with a '0' (Zero) for future use; and the last 6 characters (6!X) denote the branch identity.

SWIFT Code is a unique identification code for a particular bank and it is a standard format of Bank Identifier Codes (BIC). SWIFT Codes are used for transferring money and messages between banks. SWIFT Code is 8 or 11 characters for a bank. If SWIFT Code is 8 character code then it points to the primary branch/office

•First 4 characters represents bank code.

•Next 2 characters represents ISO 3166-1 alpha-2 country code.

•Next 2 characters represents location code. (letters and digits) (passive participant will have "1" in the second character)

•Last 3 characters represents branch code. These characters are optional. ('XXX' for primary office)

There are a great many SWIFT codes which correspond to various types of message. A SWIFT code is normally made up of the letters 'MT', and then a three digit number. The 'MT' simply stands for 'message type', and the numbers correspond to a certain type of SWIFT message. For obvious reasons these numbers are standardized globally and do not change between countries

IFSC Code vs Swift Code

Swift code and IFSC code are identification codes for the purpose of electronic money transfer between financial institutions, mainly banks. One has to mention these codes when transferring money from one bank to another. While Swift code is used for international money transfer, IFSC codes are required when one wishes to transfer money from one bank to another within India. Let us know a bit more about these codes to enlighten the readers.

Swift Code

Swift codes have been developed by International Organization of Standards (ISO) to facilitate easy transfer of money (and in some cases, messages) between banks located in different parts of the world. SWIFT stands for Society for worldwide inter bank financial telecommunication. A Swift code is made up of either 8 or 1 alphanumeric digits that provide the identity and location of the bank. In this code 5th and 6th characters are reserved for the country. For example if the Swift code is DEUTUS33XXX, it stands for Deutsch bank in Ney York, USA. When requesting for transfer of money from a foreign bank to a local bank, the banks normally charge a fees in USD which may range from $25 to $35 per transaction.

IFSC Code

If you are in India and wish to transfer money from one bank to another within the country, you can easily do it once you know the IFSC codes of both the banks. IFSC stands for Indian Financial System Code and is required whether you are using RTGS, NEFT or CEMS, which are different payment systems developed by RBI. IFSC is a 11 digit code The first four characters of this alphanumeric code disclose the name of the bank. The fifth character has been kept zero to accommodate expansion of branches. Last 6 characters in the code tell the exact location of the bank. The IFSC code is even printed on the cheque books issued by all banks and one can know the IFSC code by looking at the cheque slip. Here are some examples of IFSC codes. IOBA0000684, SBIN0006435, ICIC0007235

The International Bank Account Number (IBAN) is an international standard for identifying bank accounts across national borders with a minimal risk of propagating transcription errors. It was originally adopted by the European Committee for Banking Standards (ECBS), and was later adopted as an international standard under ISO 13616:1997 and now as ISO 13616-1:2007. The official IBAN registrar under ISO 13616-2:2007 is SWIFT.

The IBAN was originally developed to facilitate payments within the European Union but the format is flexible enough to be applied globally and has now been adopted by many Middle Eastern countries as well as most European countries. It consists of a four character header comprising an ISO 3166-1 alpha-2 country code, followed by two check digits that are calculated using a mod-97 technique and a country-specific Basic Bank Account Number (BBAN) of up to thirty alphanumeric characters