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IFSC Code is the short form of the Indian Financial Code System. It is an identification code used by all the banks and a code is unique to a particular branch. The code is about eleven characters and it is alphanumeric. This particular code is provided to different branches of the banks and it is governed by the Reserve Bank of India, which is the highest bank authority of India, as the IFSC code is unique to a particular branch, hence, the exact location of the branch and the bank name can be easily identified with it.
As mentioned above, the IFSC code has eleven alphanumeric characters, the first four characters of the IFSC code are always alphabetic, and these four characters represent the bank and just by these characters, one can know that to which particular bank, it belongs to, the rest of the seven characters are numeric, but in certain cases, it has been observed that the IFSC code is in the combination of letters and numbers. The digits in the IFSC code, are to identify a particular branch of a bank. The fifth character of the IFSC code of all the banks, has 0 (Zero) as the fifth character. Below is the example of an IFSC code: Canara Bank IFSC Code CANA0000006
The first four characters of the above-mentioned code, are CANA, this means that this is Canara Bank IFSC code, as we can see, the fifth character of the code is zero, and this code has six zeroes and ends with number 6, by entering this code on a website, from where you can get the details of the IFSC code, you will find the details of the particular bank, to which this code belongs to. The last six digits of the IFSC code are the bank identifiers.
Why is it necessary?
The IFSC code is an important feature to validate transactions. The knowledge of IFSC code enables us, to make transactions virtually. All banks and other financial organizations use the IFSC code to conduct Real- time Gross Settlement and National Electronic funds transfer, to identify and help in the unifying the transactions between the different accounts, banks, and bank branches.
NEFT is an environment-friendly payment way, used by the individuals and organizations to transfer funds electronically from one account to a different account.
RTGS is another electronic platform to make payments, transfer and receive funds between accounts and banks in real time.
The reserve Bank of India, the banking authority, controls all the associated banking affairs and banks, throughout India. Only the RBI has the authority to issue IFSC codes to different banks and bank branches.
The Reserve Bank of India has advised all the banking firms affiliated with it, to print the IFSC code of the particular bank branch on all the checks, this helps to monitor, route, identify, and authenticate the banking instruments for the accuracy in fund exchanges.
Hope, this article will help you to get the information on IFSC codes.