Our heritage: The language of progress

We developed machinery that propelled banking into a new era.

As the postwar economy boomed, so did the number of checking accounts. Banks had to close at 2 p.m. daily to process all the checks and account paperwork. To solve the problem and improve service, Bank of America invested in technological research that would revolutionize the way banks do business.

In the early 1950s, the bank enlisted Stanford Research Institute to develop a method for handling checks by machine. The result was Magnetic Ink Character Recognition (MICR) and a custom-built machine that could put the innovation to use.

The Electronic Recording Method of Accounting, or ERMA, as the machine was called, was the first computer used in banking and the world’s first successful use of computers in business operations. In combination, MICR and ERMA instantly reduced the time required to process checks by 80 percent. In 1956, the American Bankers Association made MICR the industry standard. The numerical characters visible at the bottom right of checks today are MICR encoding.