OCR Software & Tools for Optical Character Recognition (Optical Character Recognition)

OCR Software Definition: What is Optical Character Recognition Software?

Text recognition software, commonly known as OCR (Optical Character Recognition), is a tool that enables the extraction of text from paper documents and converts it into machine-readable text files. It offers the possibility to filter out text components from scanned or photographed images or documents and convert them into machine-readable characters.

With OCR software, users can, among other things, convert a printed contract into a text format after scanning or uploading it to the program, which can then be edited in common word processing programs and document processing systems. The documents are often scanned as raster graphics. This process is possible with any conceivable scans or digital files - even with fonts from videos. The conversion process begins when the software captures characters and converts them into a digital form that can then be processed for a variety of applications. These advanced tools are designed to increase productivity by automating data capture.

Typical Applications for OCR Software

• Digitizing data for business documents, such as checks, bank statements, and invoices
• Converting printed documents into editable text components
• Making documents searchable by digitizing their text
• Governmental recognition of number plates
• Identification of individuals or extraction of information from identification documents
• Analysis of traffic signs for navigation
• Testing of CAPTCHA anti-bot systems
• Production of assistive technologies for visually impaired people

The programs from the above OCR software comparison primarily fall into the application area of the first three points.

OCR vs. ICR ICR software (Intelligent Character Recognition) can be described as a logical further development of OCR software. Here, a more detailed analysis and evaluation of the respective scan result is used.

In this process, semantic contexts are also taken into account. For this purpose, ICR software is usually equipped with a comprehensive lexicon and a grammar. With the help of artificial intelligence, such programs can even learn. The powerful segmentation function of OCR and ICR software visually divides the text into logical sections, which facilitates classification and storage. OCR software, on the other hand, works more on the basis of recognition patterns. The letters of a text are statically compared with a database and then converted into corresponding machine-readable characters.

OCR software is often sufficient for simple printed documents. However, when things get more complex or even handwritten elements need to be analyzed, only an ICR solution can often help.

Why Should Companies Use a Text Recognition Tool?

The use cases for OCR are diverse and range from simple business card entry into a digital database to complex data extraction systems used on a large scale in companies and authorities. OCR software and tools play a crucial role in modern information management and contribute to speeding up processes and improving access to information.

Digitization is steadily advancing. As a result, more and more important business and even critical document-based processes need to be handled using software or even online, which were hardly conceivable 20 years ago. These include booking travel or opening bank accounts, for example.

Of course, there are still certain processes that must be carried out completely or at least partially analogously. This primarily affects the signing of significant contracts or even legal requirements.

Regardless of whether a company has been in business for a long time and perhaps still has to manage many documents from more analog times, or it is a modern start-up that has oriented its business entirely to today's digital prerequisites: There is a multitude of data in printed form in almost every business case that must be applied digitally in certain contexts or kept properly and, if necessary, quickly accessible.

Of course, it is possible to scan corresponding documents and store them in this form. However, this has the disadvantage that the information contained therein cannot be read out. To find details, the files must be examined as a whole. If the complete facts or even just parts of these are to be further processed, this is only possible through manual transfer, i.e., typing. All this means a lot of effort.

On the other hand, with suitable OCR scanning software, a lot of work can be saved. Documents are made machine-readable in detail after conversion. In a database, it is thus possible to directly access individual contents and text processing is simply possible by copy-and-paste.

How Does Professional OCR Software Work?

There are OCR tools in different technical orientations. Cloud solutions are now widespread, which can be easily used via a browser or an app from any device with an Internet connection. However, many on-premise OCRs are still available, i.e., those that are installed on a local server or computer.

Regardless of the type of OCR software, the programs usually work with two types of algorithms to recognize text in images or scans:

1. On the one hand, there is OCR software that uses pattern recognition or matrix comparison to search for specific schemes. Here, text examples are used that have already been provided to the solution. The software thus compares images with text patterns that are fed to it and then selects the text parts in the relevant scans if it finds shapes that match its references.

2. OCR software that works with feature recognition is based on a predetermined set of rules for each character. These rules tell the program how to recognize the letters in a scanned document. A character has multiple rules, such as straight lines, angles, and shapes. The software analyzes a given image and uses these rules to convert the text character by character.

Most modern OCR programs use two passes to extract text information.

During the first scan or first pass, only general information is considered, such as rules from feature recognition or pattern recognition, to define the text in a document. The software breaks down the characters into basic shapes to create a library for the font style of a particular document.

It starts analyzing the recognized symbols and matches them during the second scan or second pass with possible characters in its internal library. Since the OCR software has already established some associations between the letters and the rules known to it, this second scan ensures higher accuracy for each character.

What Advantages and Disadvantages Do OCR Text Recognition Softwares Offer?

More and more companies are relying on optical character recognition to convert scans into digital or machine-readable text. OCR essentially makes scanned documents more flexible and efficient to use. The advantages associated with it are summarized again in the following.

• Searchability: It is incredibly difficult to search unstructured or non-machine-readable text data. However, when an OCR solution is used, searches can finally be carried out like in any Word document. Indexing or categorizing and retrieving certain keywords are no longer a problem.

• Security: OCR helps those responsible to protect their data from hackers or other individuals who might try to access it without their consent. It not only stores text information digitally but also allows encryption, specific data recovery, and improved access control.

• No manual data entry: OCR filters out bank account numbers, invoice details, or other information essential in certain business contexts from printed documents. Via the right interface, these facts can be immediately transferred to a further processing program. Manual filling is thus no longer an issue.

• Saves time and reduces costs: A text recognition software reduces unnecessary work and allows more time to focus on more important tasks. Especially for a possible typing of needed papers in digital form, otherwise a lot of time and ultimately money would have to be spent. But also the search for certain information in such documents would mean considerable effort without OCR.

• File formats: The extracted text blocks can be converted into various editable file formats while retaining the original formatting as far as possible. This is especially important for document management as it simplifies post-processing and enables efficient archiving.

• User interface Another key element is the user interface, which is intuitively designed to simplify the reading and processing of documents. Users can copy texts directly into the clipboard or prepare them for batch processing, which saves time and enables the handling of large amounts of data.

Good OCR software undoubtedly has many advantages. However, there are also some limitations. The following lists typical challenges when dealing with appropriate programs:

• Reliability and Accuracy: While OCR works excellently with printed text, it is not always reliable with handwritten documents. This is a problem for anyone who wants to digitize handwritten notes or scan documents with handwritten text. While it is possible to teach an OCR system to read handwriting, it is still difficult to achieve complete accuracy. Even with typed text, OCR technology can make mistakes. This is often the case when scanned documents are in an unreadable font. The program may then skip some characters that it classifies as unreadable. When the relevant documents are converted, it is necessary to manually check whether the digital text was correctly analyzed. This takes time. In general, some OCR scanner software tends to have higher error rates than others. Here, almost all documents need to be proofread and manually post-processed. While this is not a big problem when only occasionally a few pages need to be scanned, it becomes a significant challenge when regular document pages need to be digitized.

• Storage space: Each document must be saved as an image before it can be converted into searchable text. This requires a lot of storage space. The quality of the final image depends on the quality of the original image - if there is a problem with the original document, this is also reflected in the scanned text. Scans should be stored in high quality for the best results. The more papers needed to be organized, the more storage is required. When using a professional document management, corresponding storage requirements can have a noticeable effect on the price.

How to Choose the Best OCR Software from the Comparison?

About ten years ago, the market for OCR recognition software was tiny and therefore manageable. That is no longer the case today. Almost all major tech companies offer specific solutions and continuously new programs are added by established companies or start-ups.

Finding a suitable OCR scan software is anything but easy. With the following six tips, those responsible can reliably narrow down their options and filter out the tools that are likely to best suit their needs.

1. Appropriate OCR program for your own needs: There are many types of documents - banking papers, insurance contracts, legal requirements, invoices, handwritten agreements, and so on and so forth. A good OCR software must first and foremost be efficiently usable for exactly the formats that are most common in the respective user context. Especially with sensitive papers, it should be ensured through a thorough OCR text recognition test that the program can correctly and reliably convert everything.

2. Good performance: OCR software must be efficient and effective in processing all required documents. The three most important indicators for evaluating the performance of such a text scanner software are the quality of character recognition (i.e., the percentage accuracy in reading individual characters), field recognition (i.e., the percentage accuracy in reading all characters in a field), and the document automation rate (the percentage accuracy in reading all relevant fields in the document). Not all OCR providers provide transparent information on this. In some cases, the individual key areas are also referred to differently. To be on the safe side, a comprehensive text recognition software test should also be carried out here.

3. Optimal integration: OCR software usually does not work alone or can only fully exploit its strengths in combination with other systems. For example, converted images can be quickly and easily organized by linking to a document management system. Furthermore, it is obviously advantageous to be able to immediately assign specific documents to individual persons in the CRM program. A good interface architecture is the best way to integrate an OCR text recognition solution seamlessly into an existing IT environment. Interested parties would do well to ensure that the targeted software works ideally with the relevant existing systems.

4. Final human verification of documents: To overview the flow of analyzed documents and ensure effectiveness, the OCR software should offer a clear dashboard. Here, the automated extraction of the data is ideally clearly traceable and can be manually checked for correctness. Especially with more complex documents or more sensitive issues, a detailed control possibility is indispensable. Good scan text software can even automatically display warnings based on monitoring functions when it is unsure.

5. Further development: Continuous improvement of the software is an important key to achieving reliable document conversion. So, interested parties should definitely make sure that updates are regularly set. If the update periods are very long, this is usually not a good sign. Only OCR software that continuously "learns" can reliably serve the needs of its users in the long term and adjust to new contexts.

6. Customer service: Even with the best scanner software for text recognition, problems or at least questions can occur from time to time, which can only be solved by a representative of the OCR provider. Therefore, before deciding on OCR software, you should make sure that customer service helps efficiently and quickly when needed. Especially when correct digitization is business-critical, this can otherwise lead to significant negative consequences.

What Does Text Recognition Software Cost - Is OCR Text Recognition Free?

Cheap and yet reliable OCR software is available today for less than 20 euros. Of course, it can also be more expensive. Essentially, the cost is determined by the respective range of functions.

More powerful OCR engines with many interfaces fall into the mid-price range and cost between 50 and 100 euros. When it comes to more extensive suites, the solutions can easily cost 200, 300 euros or even more. However, this usually involves functionally strong software, where OCR does not play a central role but is simply included. These include large accounting software systems or ECM systems.

Can text recognition programs be used for free? Yes, many free OCR programs can actually be found on the Internet. However, keep in mind that the reliability of such tools often leaves something to be desired. Text sections are not correctly recognized or even incorrectly converted again and again. With free OCRs, it is therefore all the more important to test them more closely before using them for business purposes.