As most of our daily chores are computerized, it is pertinent that computers and humans exchange information and understand each other seamlessly. But, it is easier said than done. Because computers and humans understand and communicate differently creating a barrier in-between. However, there can be no debate whatsoever on the processing speed of a computer. This is where the barrier is taken down. Humans deal with a mammoth of paperwork every day and their processing is done by machines. The term ‘processing’ denotes the ability of a machine to understand what is written or drawn on paper, swiftly and accurately. Therefore, optical Character Recognition (OCR) software is used for this purpose. So, the question arises, “What is Optical Character Recognition(OCR) Technology”?

What is Optical Character Recognition (OCR) Software?

Optical Character Recognition(OCR) software is used to read and extract information or patterns from documents or photos. The documents, whether the text is in handwritten or printed form, optical character recognition technology will recognize the scanned document and then extract that information. Additionally, it converts the extracted information into machine-readable text. The information extracted by the character reader in the OCR technology includes, but is not limited to, name, identity card number, date of birth, etc.

OCR - An AI-Based Technology

OCR process is a major subset of automated solutions that involve data recognition and extraction. The OCR text recognition works on top of state-of-the-art technology like Artificial Technology (AI) and Machine Learning (ML). The AI and ML technology is a novel concept whose application and utility have surged in recent years. So, scaled and trained on AI and ML models, one can be sure of quick, reliable, and accurate results of data recognition and extraction.

The Spectrum of OCR’s Utility

Optical Character Recognition (OCR) for Identity Verification

OCR is quite important for IDV systems. Scaled on ML and AI models, it ensures the highest accuracy of information extraction and recognition results. The process of data recognition and extraction in ID verification executed by the optical character recognition system is stated as:

1. First, the scanning of the document is performed by the system. 

2. The user either uploads a photo of their ID card or displays it to the system's camera. Then the system takes a screenshot of the provided document.

3. Running on AI and ML models, the OCR technology then extracts the textual or the pictorial data depending upon whether the provided artifact is a document or an image.

4. Then, the ID verification system displays the data to the user.

5. Through the information form, the user can edit the data shown to them in case of misinterpreted or wrongly extracted information. 

Optical Character Recognition (OCR) for Banking

The world is continuously going through a technological revolution and one thing that has to be managed amid this is finances. The movement and placement of money involve highly sensitive documents that need quick and reliable processing. So, for banks and other financial institutions, OCR document scanning becomes too important to ignore. OCR scanning is a utility for banks that enables them to achieve higher transaction security and reliability. A bank has to deal with a wide variety of documents, some of which are old, torn, and damaged. But, OCR technology seamlessly reads and extracts through any wear and tear providing the banks a significant advantage in dealing with a lot of customers every day.

Advantages for Businesses Employing OCR

• It is time-efficient as it performs document scanning in mere scanning.

• For businesses that deal with processing a lot of customers’ documents, the application of Optical Character Recognition (OCR) increases the number of their customers onboarded.

• It assists in enhancing customer retention as the error-prone and lengthy manual process of data extraction is bypassed.

• OCR can perform its magic in multiple languages thus eliminating the need to hire a translator.

The Final Verdict

Before Optical Character Recognition (OCR), the manual extraction of data from the documents and re-typing it was tiresome and unreliable. It was prone to human errors. After its arrival, people were skeptical as to what OCR scanning is and what is the reliability of a machine over a human, or how OCR even works. But these concerns soon vanished when OCR was being employed by search engines, data entry firms, banks, IDV systems, etc. Apart from businesses, people are also reaping its benefits through OCR apps and OCR for mobile.