What Makes IFSC an Important Point in Banking Terms?

With the world turning towards digitalization, almost every activity is being carried online. Similarly, transferring money is also being carried within a few clicks. But, there are lots and lots of security gates to come across. Just like OTP (One Time Password), the IFSC code is also another vital point. Let us get introduced to the concept of IFSC!

What is the Value in Association with IFSC?

Indian Financial System Code is the IFSC full form. It is a highly unique eleven character code through which you will be able to learn about the bank as well as the branch in which the respective account is available. While transferring money online through NEFT, IMPS and RTGS fund transfer, it is mandatory to supply the IFSC details.

If you mistakenly enter the wrong code, then your transaction may get withheld. Finally, it may result in lots of delays and frustrations. Thus, it is advisable to enter the details carefully. You may refer to Google, the bank passbook or the cheque book to ensure the IFSC details.

For others, you may request the person concerned to provide you with scanned copies of the first book of the passbook or the cheque book. It will keep both of you in a safe zone.

How to Identify the IFSC Code?

Nothing to worry about as every detail will be mentioned precisely in the bank passbooks and cheque books. Still, as a part of general knowledge, the following are steps that will help you to identify an IFSC code or take help of financesmarti:

• The first four characters will represent the respective bank’s name (S.B.I., Canara Bank, etc.)
• The fifth character will always be zero. It is reserved for future usage.
• The last six characters represent the code of the respective branch.

These are general rules for identifying an IFSC code for any branch of the bank. For example, SBIN0000765 is an IFSC code. Here, SBIN describes the name of the bank, and 0000738 denote the number of the branch. With the help of this code, you will identify the bank and branch with ease. It will help in making your payment transfer easy.

How does an IFSC Code Recognize and Differentiate Every Branch of the Bank?

With the IFSC code’s help, you will be in a favorable position to recognize and differentiate every bank branch in different payment methods. They are:

• RTGS (Real-time Gross Settlement)
• NEFT (National Electronic Fund Transfer System)

The vital difference between both these methods is that in NEFT, the funds move in batches. As hourly intervals are already fixed, the payment settlement is assigned to a single slot of time.

What is the Correct Method to Obtain the IFSC Code of a Specific Branch?

What to do in case you have lost the scanned copy of the cheque book and bank passbook? Will you keep the payment on hold? Not! In such a situation, you will be able to obtain the IFSC code for the respective bank online by entering the following details:

• Name of the respective bank
• Name of state and district
• Name of the branch

It will become easy to come across the IFSC code easily and make transfer easily by supplying these details. For safety purpose, sharing bank account details along with passwords is not advisable. It will help in preventing unnecessary bank frauds.

Is there any Additional Benefit in Association with IFSC Code?

There are innumerable numbers of benefits in association with an IFSC code. Some of the highly remarkable ones include the following:

• Apart from ensuring a smooth transfer of money online, it ensures verification and evaluation of all financial transactions types in a hassle-free manner.
• With the help of IFSC code, RBI will be able to administer and handle every type of e-banking transactions easily
• It helps in preventing any fraud or big blunders related to financial transactions

These are some exclusive safety measures ensured with the IFSC code.

Is IFSC Code Meant for Transactions in India Only?

Yes, the IFSC code is meant exclusively for transferring money through online banking only in India. It has helped in making inter-state money transfers easy. If you are residing in Mumbai and have to send money to another person in Jaipur, then the IFSC code will help you to establish this task at best.

But what if your son is putting up in an offshore country and is in dire need of money? In such a critical situation, you need to know the SWIFT code instead of the IFSC code for making international transfer easy. This activity may be carried online from your own comfort or by approaching the nearby branch.

There are times when the banks undergo restructuring of IFSC codes. It especially takes place when two or more branches merge. But transactions will still get carried on. For your safety, you must confirm the changed IFSC code, if any, for perusal. Otherwise, you may have to face lots of delays and wrong transfers too!

Are IFSC and MICR Codes Same?

This is a common question that hovers in the minds of common men. Generally, people commit the blunder by considering both as the same. But in reality, it is just the reverse! Below is a detailed difference between both that will help in distinguishing between the same:

• The IFSC code helps initiate money transfer between the branches of banks in India. At the same time, the MICR code is initiated for making cheque transfer simpler and easier.
• An IFSC code is an eleven digit code that helps in identifying the branch name. But the MICR code is a nine-digit code.
• The first four characters in the IFSC code represent the name of the bank. Whereas in MICR code, the first three digits represent the city code where the branch is located.
• The last six digits in the IFSC code represent the location of the branch. The last three digits in the MICR code indicate the branch code of the bank.

Hence, in conclusion, it is crystal clear that the IFSC code’s role is vital in bank transactions. Without knowing the IFSC code properly, it will become difficult to ensure a peaceful and hassle-free money transfer.