Wire transfer vs ACH payment

Although wire transfers and ACH payments are both common types of electronic funds transfer in the US, they notably differ in speed and cost.


Speed comparison

The wire network processes transactions in real time, so wire transfers are usually delivered quickly - within minutes or hours. An ACH payment, on the other hand, can take several days to settle (more on this in Chapter 3).

Cost comparison

Sending a wire transfer within the US is expensive, costing the payer an average $25 per transaction (and fees can be even higher for international transfers). On top of that, some financial institutions may also charge the recipient a fee to receive the funds.

An ACH payment can be orders of magnitude cheaper per transaction than a wire transfer - something we explore more in Chapter 2.

Which is better?

Because of their high cost and speed, wire transfers are best for large or time-sensitive transfers, either within the US or abroad. But if time-sensitivity isn’t an issue, an ACH payment offers significant advantage over a wire transfer, with its lower cost.

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