What are those numbers at the bottom of my checks and bank drafts?

Nobody likes writing out checks. After all, the more you write, the less money you have. And certainly, not many people pay much attention to checks beyond simply writing them out. But have you ever taken a good look at them? Maybe if you’ve ever made a check-by-phone you’ll be a little familiar with all of those numbers on the bottom of your checks, but otherwise you’re probably in the dark.

Since it’s never a bad idea to know more about your finances, I’ll enlighten you.

At the bottom of the check there’s a row of numbers consisting of the following 14 characters.

This font, known as E13B, was created for use with Magnetic Ink Character Recognition (MICR), and has been used since its creation in 1956 to automate, expedite, and improve, check processing by allowing machines to read numbers. This row of numbers contains all of the data necessary to identify you, your bank, and your bank account.

The first set of numbers – the ones between the colons – comprise the American Banking Association routing number. Up until 1910 the only way that a bank could be identified was by it’s name, but in 1911 the ABA worked with banks to assign an identifying number to each bank in an attempt to keep up with the ever-growing number of banks in the US – and to eliminate the possibility of check fraud. Rand McNally (the same ones who manufacture maps and atlases) became the “assigning agent” of these numbers and a book was published containing the bank numbers and their locations. The numbers aren’t randomly assigned, but rather are based on the bank’s location, the type of financial institution, and type of negotiable.

The second set of numbers is the individual user’s account number, and the third is the individual check number.

With all of the technology we have available today, you may be wondering why banks are using such an seemingly arcane system. Well, basically, because it works. With every bank in the US and Canada uses this system and therefore, would be expensive and time-consuming to convert every bank. Plus, the special magnetic toner used in MICR doesn’t reproduce on a photocopy well thus all but eliminates the passing of fraudulent checks. So why mess with a good thing?