State Bank of India is an Indian multinational bank, owned and managed by the Indian government. This public sector and financial services company is headquartered in Mumbai, India. The roots of the bank are founded in 1806, which makes it the oldest commercial bank in the Indian subcontinent. Back in the years, bank of madras got merged with two other banks namely Bank of Calcutta and Bank of Bombay, which together formed the Imperial Bank of India. In the year 1955, Imperial Bank of India was renamed as State Bank of India.
On 1st April 2017, SBI merged with its five associate banks namely State Bank of Hyderabad, State Bank of Bikaner & Jaipur, State Bank of Mysore, State Bank of Travancore, and State Bank of Patiala. This was the large scale consolidation first time in the history of Indian banking industry. SBI holds the widest banking network with more than 24000 branches and over 59000 ATMs across India. It also has 198 offices in 37 foreign countries and 301 correspondent offices in 72 countries. Securing the top position in the leading bank list of India, State Bank of India offers a wide spectrum of banking and financial products and services comprising of agricultural banking, personal banking, NRI services, corporate services, international banking, and online fund transfer services.
The government is emphasizing on digital transactions in order to reduce paper work and possibilities of manual errors, which has led the bank to introduce fund transfer methods on electronic platform. However, RBI passed the guideline where it is mandatory to provide SBI Bank IFSC code, in order, to precede the online transaction. IFSC code is an 11 digit alphanumeric character, where the first four alphabets signify the name of the bank, the fifth character remains zero and reserved for future use, and the remaining 6 digits denote the bank branch code. This unique SBI IFSC code helps the RBI (Reserve Bank of India) to identify the participating bank in the fund transfer transaction. Also, in case of any counterfeit or manual errors during the transactions, it becomes easy for the RBI to identify the real culprit.
Well, there are lot of people who confuse themselves with SBI IFSC code and MICR code; though, both the codes serve the same agenda, their unique identity format is different from one another. MICR code is a 9 digit identity code, where, the first three digits represent the city code, the next three characters denote the SBI Bank code, and the last three digits signify the SBI Bank branch code. You can find SBI MICR code printed at the bottom of every cheque leaf of the cheque book.
A special Magnetic Ink Character Recognition (MICR) technology is for verifying the legitimacy of the transactions done through cheque. Sensitive to magnetic fields, a special ink is used for printing the characters of MICR code and thus, the information is encoded in the magnetic characters. Moreover, this unique identity code supports for faster cheque clearance process. It increases the security of the transactions and reduces the risk of fraudulent.
For example, a counterfeit cheque is produced by someone using a color photocopy technique; the magnetic ink will either produce an incurred code or will not respond to magnetic field. In this way, the MICR reader machine will reject the cheque produced through skimming the cheque. Also, MICR reader will reject even a legitimate cheque if the machine instructs that the SBI bank account holder has a poor history of writing bad cheques.
As mentioned above, both IFSC Code and MICR code serves the same agenda but, in a different format. The codes are used for security purpose of the transactions where the SBI bank details are encoded within the unique identity characters. The code defines the participating SBI bank branch which the transaction has been made to. Check out the key differences between both IFSC and MICR code:
1. IFSC stands for Indian Financial System Code, which is an 11 digit alphanumeric identity code; whereas, MICR is an acronym of Magnetic Ink Character Recognition, which is used for transferring funds to other bank accounts in a secured manner. MICR is a 9 digit character, which is encoded with the informations such as city code, bank code, and bank branch code.
2. IFSC code generally helps in secured and reliable fund transactions on a digital platform, whereas, MICR code supports for secured and faster cheque clearance process.
3. IFSC is an 11 digit alphanumeric character; on the other hand, MICR contains 9 digit characters.
4. Magnetic Ink Character Recognition technology has been in existence for quite some years, but, IFSC (Indian Financial System Code) system was introduced only when online fund transfer methods such as NEFT (National Electronic Fund Transfer) and RTGS (Real Time Gross Settlement) came into existence.
If you are searching SBI bank IFSC code, then you can find it on the first page of your pass book and every cheque leaf of cheque book provided by SBI bank home branch. If in case, you donít have your passbook or cheque book available at the moment, then you can find bank branch IFSC code at Applykaroo.com. You can also check all bank branch code lists in just a few clicks.
As the Government of India is emphasizing on digital India, the use of traditional modes of fund transfer are getting decreased day by day. With the fastest modes of fund transfer methods like NEFT, RTGS, and IMPS, it has now become easy to transfer funds anywhere in just a few clicks. However, to conduct these methods, you will be required to provide IFSC code because the transactions could not be preceded unless the code for participating bank branch has been provided.
There are certain benefits of electronic fund transfer methods. Some of them are mentioned below:
Speed of disbursement
There comes time when you urgently need to transfer funds to your friends or family and the funds are required on urgent basis. What will you do now? If you hold an account in SBI bank, then you will have several options to quickly transfer the funds. Use methods like NEFT, RTGS, or IMPS where the funds are credited immediately without taking much time to complete the transaction. Just provide the IFSC code for the SBI bank branch or any other bank against which the transaction has been made.
a. NEFT : National Electronic Fund Transfer
b. RTGS : Real Time Gross Settlement
c. IMPS : Immediate Payment Service
While the internet is spread across the globe, there are no geographical restrictions for conducting the fund transfer. The only condition is that bank branch needs to be registered with NEFT, RTGS, and IMPS modes of fund transfer. In case, the transaction is been made between domestic and international bank branches, then it is essential to check whether if the currency is accepted by the bank or not. Generally, currencies like US Dollar, EURO, and Pound Sterling are accepted worldwide.
Cost of service
While there are lots of traditional fund transfer methods, but, they will surely going to add on the cost of the transaction. Therefore, it is best to conduct the transactions using electronic fund transfer methods where the transaction charges incurred range from just Rs.2.50 to Rs.25 per transaction depending on the value of fund transfer.
Online fund transfer methods are not just about speed, wide coverage, and cost of service, but, they are also about the convenience of the transactions. You can any time take into consideration the mode of fund transfer that will be most convenient to make the transactions done successfully. You need not to rush to the nearby bank branch, just login to banks website and process the transaction.
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