We believe that a magnetic ink character recognition (MICR) line is required in order for a check to be treated and processed as check, under both Regulation CC and standards for check printing promulgated by the Accredited Standards Committee (ASC).

A check that does not include a MICR line is a “noncash item” for purposes of Regulation CC, which technically is not a check. Consequently, none of the warranties or other protections provided under Regulation CC for your bank would apply when transmitting checks without a MICR line (unless your bank has established other standards for check printing by agreements with other banks).

For resources related to our guidance, please see:

• Regulation CC, 12 CFR 229.2(u)(4) (“Noncash item means an item that would otherwise be a check, except that . . . (4) It has not been preprinted or post-encoded in magnetic ink with the routing number of the paying bank.”)

• Regulation CC, 12 CFR 229.2(k) (“Note: The term check does not include a noncash item . . . .”)

• Regulation CC, Official Interpretations, 12 CFR 229.2(vv), Comment 1 (“Information in the MICR line of a check must be printed in accordance with ANS X9.13 for original checks and in accordance with ANS X9.100-140 for substitute checks, and must be contained in electronic checks in accordance with ANS X9.100-187. These standards could vary the requirements for printing the MICR line, such as by indicating circumstances under which the use of magnetic ink is not required. Banks that exchange checks electronically may agree to other standards for including MICR line information in the checks that they exchange electronically.”)

• Accredited Standards Committee (ASC), (February 2, 2018) (“Even though check clearing continues to evolve, Checks and Substitute Checks (IRDs) are legally required to include a magnetic code line in order to be treated as a ‘cash item’ for processing in the U.S. Payment System.”)