How Is A Wire Transfer Different From EFT?

The modern-day money transfer has changed a lot. Technology has helped us with new methods of transferring money within countries and from abroad as well. Wire Transfers and EFT Payments (Electronic Fund Transfers) are the gold standards today

Though these two processes seem similar, there are subtle differences between them. 

Let us delve deeper and find out what makes these two different.

What is a wire transfer? What is EFT?

Wire Transfers are a specific type of EFTs, involving fund transfers between banks and non-banking financial institutions. The transfer happens between individuals or entities across the network of these participating entities. The unique thing about these transfers is that there is no physical transfer of money. The institution remitting the amount sends a message over a secure messaging system, i.e., the SWIFT network. This message tells the receiving bank to deposit the reserve funds of the remitting institution to the recipient’s account. The transfers are then settled between the two institutions. It is important to note that these transactions are not generally reversible. So before initiating the transfer, it is advisable to carefully verify all details.

EFTs, on the other hand, is a generic term for many fund transfer processes over the electronic medium. These are done by businesses to pay vendors and employees. Individuals use EFTs to transfer money to friends and family. They also use EFTs to make online purchases. There are many different processes through which EFTs work, out of which Wire Transfers are also a part. Other methods include Telephonic transfers, online transfers, card payments, payments through ATMs, Point of Sale payments, direct debits, and bank transfers. 

What does the process involve?

The procedure for Wire Transfers includes filling up a form with the necessary details that are then verified, and then the following processes conclude the transfer of the amount. For EFTs, the process is much more varied and can have different ranges of procedures included depending on the type of the transfer. The POS transfers happen through swiping of cards. Internet banking transfers often include adding beneficiaries, getting them verified, and send the money.

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Time required for clearance  

Wire Transfers are very secure and often have high fees involved. The time taken for Wire Transfers within a country is primarily instantaneous. However, international Wire Transfers can take a long time. They can take several working days to be completed. In EFTs, the time required is variable depending on the type of transfer being done. Generally, most EFTs are completed within three working days from when the transfer is initiated.

Expenses involved

The fees are substantially different for Wire Transfers when compared to other forms of EFTs. The higher charges for Wire Transfers are because they are processed quickly. The transfers are divided into international and domestic transfers and are charged accordingly. There are fees for both incoming and outgoing transfers. Domestic transfers are $15 on an average for incoming and $25 on an average for outgoing transfers when done through banks. International transfers are charged $15 and $45 respectively on an average for Wire Transfers. The fees for EFTs can vary a lot, as mentioned earlier. Telephonic transfers can cost 25 pounds for every transfer. Online transfers are cheaper and may cost as low as 0 pounds for the sending account and between 5 to 10 pounds for the receiving account. Payments through cards, POS payments, and direct debit payments do not attract any charge in most cases. 


The security levels are also vital when we are interested in discussing fund transfers. Wire Transfers tend to be one of the safest options for fund transfers across the world. The banks involved, check for everything essential to ensure safety. The parties involved are checked in line with Anti-Money Laundering and Combatting the Financial Terrorism policies. The messages are sent through secure channels like SWIFT. Latest online security standards are followed in Wire Transfers. EFTs are also secure and follow the best security standards available, but there can be times when problems may occur like ATM cards or data are vulnerable to data theft, the same can happen with POS terminals. There is some risk of fraud when making online payments.

Having said all of the above, it is clear that there are some noticeable differences between Wire Transfers and other forms of EFTs.

Disclaimer: This content does not necessarily represent the views of IWB.


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