Difference Between Wire Transfer and EFT

Edited by Diffzy | Updated on: September 15, 2023


Difference Between Wire Transfer and EFT

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Wire transfers and electronic funds transfers (EFTs) are two of the most used money transfer methods, yet they are unique from one other. Customers are increasingly looking for ways to transfer money quickly and securely from one person or organisation to another, which is why wire transfers and electronic funds transfers have become popular. Electronic money transfer vs. wire transfer: all you need to know is in this tutorial.

Wire transfer vs EFT

Wire transfers and electronic funds transfers (EFTs) have a few minor variances, largely due to the fact that wire transfers are a specific sort of electronic funds transfer (EFT).

Money can be transferred electronically between persons or corporations over a network of banks and non-banking financial institutions, such as money transfer agents or specialised money transfer companies. Instead of physically transferring cash, the remitting institution instructs its receiving counterpart to deposit its reserve funds into the recipient account mentioned using a secure messaging technology, such as the SWIFT network.

Both institutions will subsequently be able to finalise payment details to record this transfer after these instructions have been received by them. It's possible to move money from one bank account to another using a wire transfer service. There is no way to reverse a wire transfer after it has been begun. It may be difficult to undo the transfer if the information you submitted was incorrect.

In contrast, an electronic fund transfer (EFT) is a catch-all word for any type of electronic fund transfer that involves moving money from one bank account to another. Businesses routinely utilise EFT payments to pay suppliers and staff, while consumers frequently use EFT payments to make online purchases.

While a wire transfer is a sort of electronic fund transfer (EFT), there are many different types of EFTs.

Difference Between Wire Transfer And EFT In Tabular Form

Parameters Of ComparisonWire Transfer


Fund Transfer

Most bank-to-bank wire transfers utilize the SWIFT (Society for Worldwide Interbank Financial Telecommunication) network.

This network is a secure communications system that banks use to communicate with one another, including wire transfer details.

process for a wire transfer:

Step 1: A wire transfer form is filled out by the originator of the transfer, who instructs their bank to pay a selected beneficiary a particular amount. The beneficiary's name and address, the bank's name and address, the account number, the branch, the IBAN, ABA, SWIFT or BIC code, the location and the nation are all included.

Step 2: A secure messaging method, such as Fedwire or SWIFT, is used to transmit the instructions from the sending bank to the receiving bank, instructing it to credit the identified customer's account.

Step 3: Receiver banks verify that instructions have been entered correctly before transferring funds to customers.

In the United States, electronic funds transfers (EFTs) are most commonly performed through an automated clearing house (ACH) or a BACS payment.

ACH transactions are generally more secure and less expensive than wire transfers, although they might take longer to reach your recipient's bank account than a wire transfer would.

how card payments work:

  • 1: For the card payment, thecustomer swipes their card or enters other details at an electronic terminal or an online merchant store. Merchants mention the various types of card that they accept for payment.
  • 2: These details are then forwaded to the payment processor or acquiring bank.
  • 3: The acquiring bank routes the transaction to the payment network, Visa, Mastercard, American Express, Discover, or any other card.
  • 4: The payment network now transfers the transaction details to the issuing bank, which is the customer's bank.
  • 5: Based on the transaction details, the card issuer either approves or rejects the transaction. Insufficient balance and wrong card information lead to declined card transactions. Whatever the outcome, information is rerouted back to the acquiring bank through the payment network.
  • 6: The merchant gets a response code at their terminal from the acquiring bank, and the transaction is finalized. Then, the transaction is settled. The rest of the process comprises clearing and settlement of the transactions where the payment processor deposits funds to the merchant's account at a pre-agreed fee.

            Time Required

Wire transfers are more expensive than other forms of electronic funds transfer (EFT) since they are often completed much more quickly.

Transferring money internationally by wire, on the other hand, may take a little longer, up to a few days.

You can learn more about the best approach to sending money by reading our wire transfer guides.

Payment types influence how long an EFT transaction takes.

Most electronic funds transfers (EFTs) are cleared the following business day or within three business days at the most. International money transfers and transfers of significant sums may take longer than usual.

Types of Payment

A domestic or international bank-to-bank transfer employing your financial institution as a middleman

There is a non-bank institution that initiates a money transfer. International money transfers are the most popular usage for these; however, they may also be used to transfer money locally

Many additional payments can be classified as electronic fund transfers. These can include:

  • Often used by businesses to pay employees, direct deposits can be pre-arranged to deposit funds in another account on a regular, scheduled day.
  • For online payments, a debit or credit card can be used. 
  • ATMs enable you to check your bank account balance and withdraw or deposit money without physically entering your bank.


         Commonly Used

You may use wire transfers to send or receive money quickly. Wire transfers offer a faster and more secure option than other bank transfer methods, such as ACH payments, when it comes to sending money to someone.

Businesses utilize electronic payment transfers to pay vendors and workers the most frequently.



Wire transfers are more expensive than e-fund transfers because of the speed with which they are performed. The wire transfer costs for US and UK banks may be found online.

It is possible to break down the cost of wire transfers into two distinct categories: domestic (in the UK, BACS) and international (in the EU, SEPA). Wire transfers within the United States typically cost $15 for incoming transactions and $25 for departing transfers when conducted through a bank. There is a $15 fee for incoming international transfers, whereas the cost is $45.

When sending money overseas, the exchange rate margins your supplier charges for currency conversions are also something to consider.

Due to the time it takes for electronic funds transfers to settle, they often have lower costs than wire transfers.

The sort of EFT payment you're making, on the other hand, is what makes a difference. While a transaction in your currency may not have any fees connected, a withdrawal from an ATM in another country may be subject to additional charges.

On the other hand, direct deposits are a popular payment option with businesses because of their minimal costs.

Telephone transfers: It costs roughly £25 per transfer to use your bank's telephone service.

Online banking: There are no fees for the sending account, and the receiving version should expect to pay anything from £5-£10 for each transaction.

Card payments: Most debit card transactions are accessible to the customer, while credit cards may levy a cash advance fee if the transaction goes through.

Transfers made at the point of sale: Most of these payments are free.

Direct debits: are free for the sender unless explicitly specified differently in most cases. Recipients may be required to pay a one-time charge and a monthly fee for the use of the service.


Secure Payments

Wire transfers are generally subject to strong AML/CFT standards, which require that all parties involved in the transaction be thoroughly vetted. SWIFT or Fedwire are two examples of secure messaging systems used to transmit financial instructions.

Banks and money transfer providers must also utilize technology like SSL to protect their customers' communications.

EFTs, on the other hand, are safe and secure. For this reason, customers should exercise greater caution when using alternative electronic funds transfers (EFTs) rather than wire transfers. Security concerns to keep an eye out for include the following:

  • Customers cannot access their accounts or receive important notifications on concerns like lost cards when an ATM is offline. This might put your safety in danger.
  • Vandalism is a possibility with POS terminals. Therefore they may become dysfunctional.
  • There is an ever-increasing risk of card fraud when paying with a debit or credit card.

Despite this, EFTs are making progress in terms of fraud prevention. Financial institutions like Visa and MasterCard have developed cutting-edge anti-fraud measures such as EMV chips and predictive analytics in order to combat the growing problem of online fraud.

What Is Wire Transfer?

Transferring money electronically between individuals and businesses is known as a wire transfer. Before the payment details are finalized between the two banks/financial institutions engaged in the transaction, payment instructions are conveyed via secure messaging systems - an example is SWIFT. Wire transfers have the advantage of being completed almost immediately. It may take a little longer for foreign wire transactions (up to several working days).

What is EFT?

It stands for Electronic Fund Transfer, or simply EFT. "Electronic Money Movement" refers to any electronic transfer of funds between accounts. When we use the phrase "EFT," we mean a wide range of payment methods, such as telephonic and computer-based ones, as well as traditional ones such as ATM and Direct Debit withdrawals and deposits, as well as e-checks. In most circumstances, the EFT payment will be ready by the following business day or up to three working days, depending on the kind of EFT.

Main Differences Between Wire Transfer And EFT in Points

  • After learning more about EFTs and wire transfers, you should better understand how they differ from one other. You may think of it this way: an EFT is a wire transfer form, but it's not the same thing as a wire transfer. Wire transfers are one type of electronic payment, but EFTs cover the entire category of electronic payments. Both provide safe and easy means to transmit money.
  • Wire transfers have a few advantages over other forms of electronic funds transfer (EFT). The quickness of the transaction is one of the most crucial factors. On the other hand, Wire transfers can be done immediately, although different electronic funds transfers (EFT) may take longer. As a result, wire transfers are an excellent solution for payments that must be sent quickly, such as in commercial transactions.
  •  Another important consideration is that of safety. Wire transfers provide more stringent security procedures than other EFTs, making them a better choice if you're sending a large sum of money.
  • When comparing EFTs versus wire transfers, consider that costs are a crucial factor to keep in mind. Wire transfers are often more expensive because of their faster processing speed. The cost of a wire transfer might range from $20 to $50, depending on various circumstances. EFTs, on the other hand, tend to be more reasonable. However, the price you pay may vary depending on the EFT you use. In contrast to pricey phone-based transfers, card payments often have no fees attached.


Sending and receiving money by wire transfer or electronic funds transfer (EFT) is a safe and straightforward method. Online money transfers such as OFX and Currencies Direct and high street money transfer providers like Ria and Western Union can be used to make payments.

Wire transfers and electronic funds transfers (EFTs) are often used interchangeably. However, they are not the same thing. Wire transfers and ACH payments are both included in the category of EFTs. Wire transfers are a type of electronic funds transfer (EFT), but ETFs are not.

Wire transfers are the fastest and safest method of EFT due to their use of a far more stringent security standard. The sender requires a bit extra caution when using EFTs such as POS and card payments.

Besides wire transfers and EFTs, there are other methods for money transfers, such as mobile money transfers, cash pickups, and home delivery. Consider all of your options before making a transfer, and our comparison tool will help you identify the best method in just a few minutes.


  • https://www.iaacu.org/services/general-services/blog/blog/2020/05/27/ach-vs-wire-vs-electronic-transfer-what-is-the-difference
  • https://moneytransfers.com/wire-transfer/wire-transfer-vs-electronic-transfer
  • https://gocardless.com/en-au/guides/posts/difference-between-eft-and-wire-transfer/#:~:text=They%20both%20offer%20secure%2C%20convenient,is%20the%20speed%20of%20transaction.


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"Difference Between Wire Transfer and EFT." Diffzy.com, 2024. Fri. 23 Feb. 2024. <https://www.diffzy.com/article/difference-between-wire-transfer-and-eft-1110>.

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