ACH vs. Wire Transfer: What Are the Differences?

Written by Jennifer PachecoUpdated: 12th Oct 2021
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Both automated clearinghouse (ACH) and wire transfers are ways that businesses move money between banks.

Either of the two operates the same way, through electronic transfers. Sending and receiving capabilities are associated with the two transfer systems, and they’re completely safe.

There are differences between the two systems, however. Primarily speaking, wire transfers typically happen the same day but often incur a fee, whereas ACH transfers can take longer.

Wire transfers are also done singularly, whereas ACH transfers can be batched, like that of payroll payouts.

The good thing about the two is that both can be tracked via bank transaction records.

Ultimately, both have different advantages depending on what you’re looking to achieve. So, let’s get into the details below.

ACH vs. Wire Transfer Overview

Consumers and businesses are trying to determine which transfer system to use for their financial needs: ACH or wire.

Choosing one over the other is not a simple decision; you need to know the ins and outs of both systems to see which best suits your needs.

Here, you’ll get a brief overview, and in the end, you’ll have a better understanding of choosing correctly.

Understanding ACH Transfers

ACH transfers are carried out through the automated clearinghouse network, which includes 10,000 financial institutions.

They’re a quick way to move funds from one bank to another through batch processing. Once the funds go from the bank to the ACH, they must be approved before depositing.

The ACH often processes transactions such as direct debits, direct deposits, direct payments, eChecks, and EFTs.

Consumers and businesses both use this system. The primary use of this system includes ACH debit transactions, ACH credit transactions, bill payments, abroad transfers to individuals and merchants, and payments to vendors and employees.

All transactions clear in bank accounts within a few business days, so long as sufficient funds are available.

Fraudulent transactions may be questioned and may alter that timeframe. In general, these are very convenient and accessible.

Understanding Wire Transfers

Wire transfers are a different form of electronic payment service used to move money between two entirely different bank accounts.

Typically, institutions like SWIFT and Fedwire are used to complete these transactions. Transfers are often individual and must be done upon request of the sender.

They can also only be initiated and completed by the sender. Since there is no clearing house as the middleman, the banks have to act as the intermediaries for these transactions.

There are two types of wire transfers: Domestic and international. If international and coming from the United States, the transfer must be more than $15.

All wire transfers have the option to expedite the transfer delivery, but such action will incur a fee.

>> More: Best Ways to Send Money to Someone

What Are the Differences Between ACH and Wire Transfers?

ACH and wire transfers have many differences, giving advantages to either service.

ACH can take up to three days to fully be deposited into an account, whereas wire transfers are the same day or the very next day. Moreover, ACH only offers a bank transfer payment option, whereas wire transfers offer bank transfer, credit card, and debit card transactions.

ACH is completely free, but wire transfers do have additional associated charges. ACH is simply domestic, whereas wire transfers can be done both domestically and internationally.

ACH is much more secure, and wire transfers have a little bit of risk associated with them due to the fact that they are impossible to reverse.


Both are available to be submitted at a moment’s notice, but both are not available in all parts of the world.

ACH transfers can only be domestic, so you’ll have to refer back to electronic wire transfers if you want to send funds internationally.

Transfer Limits

Transfer limits are associated with both ACH and wire transfers, but they may vary depending on the bank or credit union you use.

Processing Times

ACH processing times vary from 1-3 business days as long as the funds are available. On the other hand, wire transfers are often processed the same day.

Posting Times

ACH funds often appear in “pending” status per online bank transactions for about a day or so.

The funds will not be released to you until the ACH clears them, which means you won’t have access to the money at first.

This process may take up to three business days. Wire transfers, however, allow funds to be available in the recipient’s bank account the moment the transfer happens.


Both ACH and wire transfers have an added layer of security on them compared to regular bank checks. Why is that?

Primarily because both transfer systems encrypt all banking information during the transfer.

Additional measures are put into play to verify identity and banking information before each transaction is completed, too, so that fraud can be avoided.

The only catch with security in the wire transfer system is that it is completely irreversible once the transaction is complete. If the funds go to the wrong place, you may have to pay twice.


ACH transfers are all entirely free unless the sender wants the funds expedited, but wire transfer fees range depending on where they are going and what bank they are being deposited into.

Most of the time, the fees associated with wire transfers range from $10 to $35. Even incoming wire transfers can have fees to access the deposited funds.


If there’s an error, ACH transfers can be reversed in the system. Unfortunately, wire transfers are final once sent and confirmed.

Is ACH or Wire Transfer Safer?

ACH transfers are in the hands of the Federal Reserve, with all transactions being monitored by the automated clearinghouse.

This means such transactions are considered 100% safe, with a reversal option if the request was done incorrectly.

Most consumers and businesses trust ACH transfers security tenfold if they’re trying to fully control the money being transferred. This primarily pertains to domestic ACH transfers.

On the other hand, wire transfers are generally secure, too. The twist is that you need to be sure the funds are being sent to the correct destination because once a request is complete, it is permanent and cannot be reversed under any circumstances.

Is ACH or Wire Transfer Faster?

ACH transfers are growing in popularity, requiring the automated clearinghouse to approve transactions multiple times a day to satisfy demand.

Even still, ACH can take up to three business days to entirely clear, whereas wire transfers are absolutely immediate. If you’re under a time constraint, wire transfers are the way to go.

Advantages of ACH Transfers

  • Convenience
  • Accessibility
  • Domestic
  • Recurring
  • Free – minimal cost for expediting fund transfer
  • Send
  • Request
  • General bill pay

Advantages of Wire Transfers

  • Secure
  • International
  • Large funding
  • Immediate
  • Sender makes all decisions

Which Is Better, Wire Transfer or ACH?

There are pros and cons to wire transfers and ACH transfers. Depending on your needs will depend on which option is the right fit for you.

Generally speaking, wire transfers will only be used internationally for security reasons and when time is of the essence.

ACH debits and credits are much less money, and they offer optimum security. Most consumers and companies are leaning towards ACH for all transfer needs.

Bottom Line: ACH vs. Wire Transfer

All in all, the choice is yours. Weigh the advantages and disadvantages and see what you personally come up with.

You can always utilize both forms of transfer if need be – just pick and choose the right place and right time for each.

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Jennifer Pacheco

Jennifer Pacheco attended the University of Dartmouth, Massachusetts where she earned her degree in English Writing & Editorial Work. She is a seasoned personal finance writer with over 5 years of professional work under her belt, and supplies easy-to-read information that’s educational, engaging, and conversational to help you make the most of your money.