OCR number, not only for the good…

“There is strength in numbers,

but organizing those numbers is one

of the great challenges.”

– John C. Mather

Are you getting annoyed over incorrectly placed payments when matching payments from your customers? If you suffer from this particular irritation, you are probably the administrator of a factoring company, bank or finance company. And the annoyance is justified…

The source of your irritation may have its source in incorrect specified OCR numbers. OCR stands for Optical Character Reading and is a series of numbers that should identify a payment as unique. Non-unique OCR numbers run a high risk of mismatching which often results in demanding deft. But what is OCR and why do you need this? To be able to identify a payment or invoice, an OCR number system created in the 1970s became the solution. Together with this number reference, date and amount, it ensured that the payment reached the right recipient. The OCR number was initially intended to be optically scanned by postal and banking staff using a scanner, and as everyone knows, there is reading support for OCR numbers built into most apps from our banks. OCR number is always delimited at the beginning and end of a # and can consist of Client number, Customer number, External invoice no., Internal invoice no., Ledger entry no, Ledger Register No.

How to think then? In our system, Asitis Finance, you can set the length for OCR numbers, i.e the number of digits in the series. Think about trying to maintain a length of between 11 and 16 digits, otherwise it may be a mistake when the series becomes too long. If you have a small data or a short customer number or external invoice number, there is the option to select control method, if any, and fill the rest with zeroes for the desired length of the payment reference. A recipe for a good OCR number could contain:

  • 3 digits from customer number.
  • 3 digits from invoice number.
  • 3 digits for filling.

There you have a 9-number OCR number. Then you also need to add 2 more control numbers since bank and postal giro ​​requires this, and you will have an 11-digit OCR number. When you construct your OCR number in this way, you also give clues to being able to match the payment to the correct invoice, ie you can get leads to where it belongs in the number. Absolutely perfect according to us 🙂 How to choose to build up your OCR depends entirely on the business and can vary from company to company. Men think of trying to be as unique as possible by:

  • Using number series from your internal system.
  • Avoid using reference numbers from the client’s invoice.
  • Building in the customer’s number and serial number customer accounts.
  • Please keep in mind that you can read out who the invoice references are linked to and what the invoicerefers to.

If you want to print your invoices before accounting, for example for it to be sent for review by a client, it is important to keep in mind that it is not possible to use any of the unique “building blocks” assigned to the invoice during accounting. (These are boldly marked above). Good luck with creating a sustainable strategy for your OCR numbers, and if you would like to know more about our Factor system and its functions, you are most welcome to contact us.