MICR Reading Technology
Optical Character Recognition, or commonly abbreviated to OCR, is a character recognition technology through conversion of handwritten, typewritten or printed text into machine-encoded text. Especially useful for reading of non-MICR encoded cheques, OCR analyses the structure of cheque image and divide the page into elements, such as blocks of texts, tables, images, etc.
Subsequently, OCR divides the text in lines into words, and then, into characters to be compared to a set of pattern images. Basing on numerous hypotheses about what each character is, OCR analyses different variants of breaking of text in lines into words and words into characters before finally decides and presents the recognized text.
OCR has been widely used for data entry in cheque clearing. Digitising printed texts, it allows for more compact data storage, electronic search, and on-line display. However, this technology is not cost-effective, as its read rate is substantially less accurate than MICR technology.
Decades of experience in financial business has shown that OCR’s limited ability and inherent dependence on the quality of cheque image and the quality of the software itself frequently result in a higher percentage of misreads and errors that evidently cost more resources to perform manual corrections.
In addition, since OCR cannot detect specific magnetic ink, it also increases exposures to cheque fraud. Failure to immediately detect this crime does not only disadvantage business in terms of financial loss, but also negatively impacts customer service.
MICR Reading Technology
Magnetic Ink Character Recognition, or commonly abbreviated to MICR, is a character recognition technology through scanning and reading of information on MICR line, usually on the bottom of a cheque, into a data collection device.
Being capable of reading either the MICR E-13B font that has been adopted as the international standard in ISO1004:1995 or the CMC-7 font that is widely used in majority of European countries, this technology measures the strength of the electrical signal emitted by the metallic particles contained by the MICR. If the signals of the characters do not meet the specified standard, a cheque can be dishonoured or rejected.
Basing on such specific standard, MICR technology ensures higher level of reading accuracy, minimising misreads or errors, while at the same time protecting your business and customers against cheque fraud.
MICR with OCR Technology
In case when low-end MICR encoder is used for cheque printing, causing the strength of electrical signal emitted degrades, MICR reading technology cannot avoid misreads or errors. Therefore, some financial institutions decide to equip their MICR readers with OCR reading technology.
Proper use of both OCR and MICR technologies, which combines magnetic ink reading capability with properly tuned OCR engine that serves as a secondary authentication mechanism, is expected to result in optimised cheque reading, minimising MICR misreads and rejects.
MICR with Image Capture Technology
While some financial institutions would rather combine the MICR with OCR technology, some other prefers MICR reader scanner which is built in with image capture technology. The perfect integration of the two technologies facilitates not only scanning of cheques, but also storing of cheque image in a flexible storage, (PC’s hard disk, external hard disk, etc.).
Bringing in the next generation of cheque reading technology, the MICR reader scanner is highly recommended for busy banking environments that demand cost-effective yet reliable cheque processing, including high-speed cheque reading and high-quality image capture for easy cheque archival and retrieval.
In addition, this MICR reader scanner is also equipped with high security levels, making it applicable for management of highly-confidential information, such as transaction details.