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ACH transfer vs. wire transfer: what’s the difference?

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The GoCardless content team comprises a group of subject-matter experts in multiple fields from across GoCardless. The authors and reviewers work in the sales, marketing, legal, and finance departments. All have in-depth knowledge and experience in various aspects of payment scheme technology and the operating rules applicable to each. The team holds expertise in the well-established payment schemes such as UK Direct Debit, the European SEPA scheme, and the US ACH scheme, as well as in schemes operating in Scandinavia, Australia, and New Zealand. See full bio

Last editedJul 20222 min read

Imagine you are on vacation and you just ran out of money. Or you just started a new job and want to make sure you pay your rent on time. What about when you bought that autographed copy of the first Harry Potter book on eBay? How will you go about sending or receiving the necessary funds?

In this article, you will learn the difference between an ACH and wire transfer. These options are the most popular types of electronic money transfers. Keep on reading to figure out which one will meet your monetary needs.

What is a wire transfer?

Chances are, you already know about ACH transfers (but if you don’t, why not take a look at our guide). So, what about wire transfers?

A popular method of getting paid, a wire transfer immediately sends funds from one account to another. While the funds are usually available that same day of the transfer, it may not be visible in the recipient’s account. There is a fee associated with wire transfers. Depending on your financial institution, your bank or credit union may generally charge anywhere between $10-$35 to send a transfer within the US, with a higher cost for completing international transfers.

Differences between ACH and wire transfer

You may have asked yourself if an ACH is a wire transfer. Although the two terms may be used interchangeably, both options allow for a transfer of electronic funds. The following table details some of the main differences.

Key Differences Between an ACH Transfer vs. Wire Transfer
	ACH Transfer	Wire Transfer
Speed	Typically, 2-3 business days	Instant or next day availability
Payment Options	Bank transfers	Bank transfer, credit card, debit card
Cost	Almost always free	Additional cost
Risk	More secure	Impossible to reverse

Another big difference between ACH and wire transfers is that wire transfers are available internationally, whereas ACH transfers are only available domestically. This is something to keep in mind when you travel outside the country.

Although an ACH transfer is quite safe, it is good to know that if a mistake is made by the sender, there is a possibility the transfer could be reversed.

ACH transfer vs. wire transfer: advantages and disadvantages

The process of transferring money can have its ups and downs, but you are still not sure what is better between an ACH or wire transfer? Keep on reading for some advantages and disadvantages between an ACH payment vs. wire transfer.

Some ACH transfer advantages include:

Considered a more secure option because of all the information required to send the transfer (i.e., routing/ABA number, account number, account type)
Moving toward same-day transfers, while some payments are currently eligible
Typically free for consumers, especially if receiving funds in an account

Read more about how make an ACH payment.

Advantages of a wire transfer:

Funds are usually available same day of the transfer
Payment options not only include bank transfers, but also credit and debit cards
Available internationally

ACH transfer disadvantages include:

Takes up to 3 business days to complete (read about instant ACH transfers here)
A transfer can be reversed if a mistake was made on the sender’s side
Only available domestically
Limited payment options that include a bank transfer only

Wire transfer disadvantages include the following:

Sometimes funds are not visible in the recipient account or recipient may not have access to funds immediately after a completed transfer is received
Funds must be available in sender’s account before bank sends funds because the bank immediately removes funds to process the request
If using a credit card, cost will be significantly higher due to interest rates and cash advance fees
Low risk to receive funds, but higher risk to send funds because transfers are fairly quick and impossible to reverse

What is better: ACH or wire transfer?

In the debate between an ACH payment vs. wire transfer, most of the time, people and businesses prefer the ACH transfer. Right now, the use of this transfer is at an all-time high because it’s seen as a relatively safe way to transfer funds.

On the other hand, if you are fighting against time, your best option is a wire transfer. Request it in the morning to allow plenty of time to complete the process. If you are looking to send or receive money internationally, keep in mind it can take an extra 1-2 days so, plan accordingly.

No matter what option you choose, make sure you are receiving a real transfer of funds instead of some type of scam.

We can help

GoCardless helps you automate payment collection, cutting down on the amount of admin your team needs to deal with when chasing invoices. Find out how GoCardless can help you with ad hoc payments or recurring payments.