The Differences Between Wire Transfers And ACH

Written By: Eric Williams
Reviewed by: Mike Reyes
Last Updated November 15, 2022

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Wire transfers and ACH (Automated Clearing House) are two methods used to transfer money between bank accounts. Wire transfers are processed the same day, but the fees are pretty costly. ACH is cheaper but takes longer to transfer funds. If you wish to learn more about how ACH differs from a wire transfer, in this guide, we shall look at each bank transfer method and what features set them apart. 

What Are Wire Transfers?

Wire transfers are e-payments that help transfer funds from one bank account to another. This method is used for same-day transfers. However, this facility is offered at a premium price.

There are two types of wire transfers:

  • Domestic wire transfers are made to clients or individuals within the same local region that you reside in.
  • International wire transfers or remittance transfers are a method of sending money to clients that live abroad. The amount you send must be higher than $15 if you wish to send funds from the United States to another country.

Business individuals use wire transfers to send one-time payments that require immediate processing. These kinds of transactions are also popular in the real estate industry. Remember that same-day limits must be kept in mind before sending large amounts of money.

What Is an Automated Clearing House?

The Automated Clearing House network, or ACH, comprises 10,000 financial institutions. This ACH network can be used for direct deposits, direct debits, eChecks (electronic checks), EFTs (electronic funds transfers), and direct payments. Businesses and consumers both make use of ACH transfers. All ACH transfers can be divided into two main categories:

  • Direct payments/ACH debit
  • Direct deposits/ACH credit

Some financial institutions also offer scheduled bill payments, so you can pay these through ACH transfers. You can also use ACH to send payments to merchants abroad and pay employees and even vendors. However, ACH transfers take a few business days to process and transfer funds completely. Fraudulent transactions or insufficient funds can also extend processing times.

Differences Between Wire Transfers and ACH

Now that you know what a wire transfer and ACH are, it is time to look at the key differences below:


ACH and Wire Transfers provide security that is not offered with paper checks. Financial or banking institutions provide additional protection by encrypting information when transferring funds. Both transfers require identity verification and checking for accuracy in banking information before any transaction is processed. Wire transfers are faster, so canceling requests may not be easy.


ACH transfers are usually offered for domestic transactions. An international wire transfer must be used to send funds abroad through the ACH network.


ACH transfers take one to two business days, while most wire transfers are quickly processed on the same business day. ACH transfers will show a pending status, and funds are only released once the ACH system verifies the transfer. 

Transfer Limits

Daily transfer limits apply to both kinds of transfers. Get in touch with your bank or financial institution to check limits.

Transfer Fee

Wire transfer fees can cost anywhere between $0 and $35. Each wire transfer will cost you a separate processing fee as well. Incoming wire transfers may also cause you to be subject to nominal charges. ACH transfers are often free, but a fee may be charged for bill payments and transfers to outside banks.

What Are Some Alternatives to Wire Transfers?

Individuals who do not wish to use traditional bank transfers or send money on the same day can use wire transfers. However, not all services are as prompt and can cost you much more, so make sure you input thorough research before picking any fund-transferring service.

Let’s look at some wire transfer alternatives below:

P2P Tools

P2P (Person-to-Person) services are cheaper and easy to use. Different tools offer different transfer times. These can be checked out from individual sites. This is an online payment method that often requires an email address or simply a phone number to send payments.

Money Transfer Services

Some financial services offer in-person transfers if you do not wish to share bank account information or do not want to conduct a transaction online. However, the processing time is not fixed, and it may take only a few minutes or even several days. Once processed, the person you are paying will pick up cash at the location specified on the other end. The payee will be verified through personal identification documents, name, address, and contact number.

Final Thoughts

Both wire transfers and ACH can be helpful in different situations. The service you also pick largely depends on the time you have and how much processing fee you are willing to incur.

Wire transfers are highly suitable for fast international transfers, while ACH is perfect for local transfers and paying employees, clients, or vendors.

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