Ancient history: Back in the day, shortly after MICR encoding of routing numbers was mandated on checks, routing numbers were only 8 digits long here in the U.S. For example, the routing number of my first bank employer was 0113-0655 and the routing number of the bank I ultimately retired from was 0113-0574. And that's the way those numbers were encoded on checks, with a MICR dash symbol in the middle.
Problem was, mis-sorts occurred. I vividly remember my father being charged by his bank (Hyannis Trust 0113-0574) for a check written on the same account number at Attleboro Trust Company, another bank that used the same account number scheme but had a routing number off by one digit from Hyannis Trust's).
To prevent mis-sorts, a check digit was added to routing numbers, and it was calculated and checked on the fly as checks were read in the reader-sorters of the day, so that a misread of any one digit would cause the check to reject. Because there were already nine spaces assigned to the MICR routing number field, the hyphen was dropped to accommodate the check digit.
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John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8