Do you ever wonder what the IFSC number on your passbooks, chequebooks, or bank statements stands for, and what its significance is in the Indian banking industry? Here’s everything you need to know.
How does the IFSC code affect your funds transfer?
IFSC codes (or Indian Financial System Codes) are 11-digit alpha-numeric codes used by banks within the NEFT network to identify their branches.
IFSC code: what do they mean?
There are several electronic payment systems which use IFSC codes, including RTGS, NEFT, and CFMS. Banks require these codes for fund transfers between accounts. Every branch has a different code, and no two banks (even branches belonging to the same bank) will have the same code.
An IFSC code represents the bank with the first four digits and the branch with the last six digits. The fifth character is zero.
Example of SBI IFSC Code –
An IFSC code issued by the State Bank of India (SBI) contains four letters ‘SBIN’ followed by six digits of a branch code. For example, SBI’s branch at 23, Kalyani Park, Baner, Pune 411045, has IFSC code SBIN0111100. Its branch code is 111100.
To add beneficiaries, you need to know the IFSC code of the bank. The RBI provides a list of banks through their website that offer NEFT/IMPS/RTGS services, including their IFSC codes.
Getting the IFSC code of your desired bank branch has never been easier. You just need to select the name and location of the bank branch you wish to find, and after clicking, the IFSC code will appear on your screen.
This is the RBI portal for checking the IFSC code of all Indian banks – https://www.rbi.org.in/Scripts/IFSCMICRDetails.aspx
How does IFSC impact your business?
In essence, an IFSC code is a code that is used to facilitate easy, secure, and accessible online fund transfers. Here are some of the advantages it offers:
1. Transacting with ease
With the IFSC, fund transfers between banks are seamless and error-free. NEFT, RTGS, and IMPS are some of the modes of financial transactions that RBI can track, monitor, oversee, and authenticate from the identification code.
2. The identification of banks
It helps in determining which bank branch to transfer money to, and how much to transfer.
3. Error-free
By requiring an IFSC for fund transfers, Net Banking has become a highly secure platform; an IFSC reduces the chances of fraud, errors, and theft during fund transfers.
4. Easily transfer funds
IFSC has simplified the process of handling financial transactions. Fund transfers can be done within minutes, anywhere in the world, from any corner of the globe. This has been a boon for those in need of funds to tide them over until their emergency fund is available.
5. Eco-friendly Banking
By using IFSC, account holders contribute to the environment by transferring money in a paperless manner.
6. Is it possible to change the IFSC
There is typically no change, revision, or updating of the IFSC. However, when a bank merges or reorganizes, it changes its identification code. Account holders will receive a new code.
In our opinion, this is a necessary step so that the online financial transaction can be completed successfully and reach the beneficiary’s account without a hitch.
Why IFSC Code is Required to Transfer Money –
With IFSC codes, customers are able to transfer money from one account to another quickly and easily through three primary electronic fund transfer systems known as NEFT, RTGS and IMPS.
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RTGS
Fund transfer via RTGS (Real Time Gross Settlement) are fast and convenient, allowing money to be sent and received instantly once it has been initiated by the remitter. Unlike batch-based systems, transactions are processed individually.
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IMPS
A real-time EFT method. Instant payment service lets you deposit funds directly into an account of your payee or beneficiary whenever you wish, 24 hours a day, seven days a week.
The primary advantage of IMPS over RTGS and NEFT is that it is available 24 hours a day. IMPS transfers can be initiated via SMS, ATMs, mobile banking, internet banking, etc.
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NEFT
NEFT is a system that enables you to transfer money across bank accounts. Since it is monitored by the Reserve Bank of India. It is secure and hassle-free.
For NEFT transfers, you will need the account number of the payer, the account name of the receiver, the name of the bank branch, and the IFSC code of the bank branch you wish to send funds to.
IFSC code search: how to find it?
The IFSC and MICR codes are visible on your check page. They are also available on the first page of the passbook you receive from the bank branch where you opened your account.
IFSC Code vs MICR Code differences?
| IFSC CODE | MICR CODE |
| Transacting electronically between accounts is made possible by it. | Checks are processed faster by using this code |
| This code has 11 digits | This code has 9 digits |
| Bank names are indicated by the first four characters | City code is initiated by the first three characters |
| Bank location can be inferred from the following characters | A bank code follows the preceding characters |
Bottom Line:
With the IFSC code, Internet Banking in India becomes quicker, more convenient, and more secure, while indirectly contributing to the environment as well.
FAQ’s Questions :
1. IFSC code search?
IFSC codes of all Indian banks can be found on the RBI website – Click Here
2. IFSC code Indian bank?
It is imperative that you first glance at the IFSC code to see what it looks like. The first four letters should be ‘SBIK,’ and the first six digits should mean which branch you are at. For instance, SBI Bank’s IFSC code on 1201, Amar Plaza Business Park, Ground Floor, Pune 411045 is SBIK00P0045.
3. What is the meaning of IFSC codes?
Multi-bank transfer systems use the IFSC code to identify a bank and branch of a particular account, as well as identifying the account itself.
4. Are IFSC code required?
A bank accounts IFSC code must be entered for each funds transfer between accounts. This code is also used by electronic payment systems such as RTGS, NEFT, and IMPS.
5. By what method can I check my IFSC code?
With your bank account number, you will find your IFSC code. IFSC codes belong to banks but cannot be used for personal accounts.
