EFT vs ACH – Difference and Comparison

What is EFT?

EFT is the electronic transfer of funds from one account to another. either within the same financial institution or across institutions, using computer-based technologies.

EFTs are suitable for a variety of payments. They are deposits of salary, social security benefits, tax refunds, and online bill payments. EFTs are more efficient for several people than writing and mailing paper checks.

EFT is a form of digital payment that enables customers. It is used to transfer money between banks without using cash. The Monetary Authority facilitates EFT payments, which can be done via ACH, electronic transfers, or digital wallets.

EFT payments are easier and safer than paper checks, and they can make businesses save both money and time.

What is ACH?

An ACH is a digital payment that is executed via an automated clearinghouse network.

ACH payments are widely used for one-time or periodic payments. They are used for utilities, mortgage loans, and other bills, as well as direct deposit of salaries, benefits from social security, and tax returns.

ACH is increasingly widespread for individual payments. It is less expensive than other payment methods or wired government subsidies.

An ACH payment is a kind of electronic payment that occurs through the ACH network. The ACH network is a global system for confirming and collecting bank transactions.

ACH is utilized for wages, social security benefits, and tax refunds. One-time payments such as electricity bills, loan repayments, and repayments on credit cards may be made through ACH payments.

Difference Between EFT and ACH

They are the most widespread means of moving funds digitally between banking institutions.

Even though all methods allow for the online transaction of money, there are some game-changers among them. EFT is used for larger transfers, such as loans or auto installments. where ACHs are utilized for everyday transactions, such as payroll deductions from paychecks.

Comparison Between EFT and ACH

Parameters of ComparisonEFTACH  
DefinitionElectronic funds transfers, or EFTs, are any financial transactions carried out electronically.A group of financial organizations that handle electronic transactions is known as ACH.
Mode of transferThis method of payment is gaining popularity. as a more practical and effective substitute for more conventional ones like cash or money.Money can be transferred between bank accounts using the ACH method. A safe and secure way to send money is through ACH.
Why Should You Use Electronic Transfers?EFT payments are the ideal way to pay bills, send money to friends and family, or make online purchases since they are quick, easy, and secure. They are also well worth the effort.CH payments are frequently used for periodic payments like wages or monthly invoices. One-time payments like compensating a contractor for work accomplished, and ACH transfers are also feasible via ACH transfers.
Pros of paymentThey are affordable, effective, and safe. EFT payments are practical for busy people because they may be done electronically or through a mobile app.ACH payments are practical, safe, and economical. They receive direct deposits and pay bills; they can also be used to transfer money between accounts.
Cons of paymentThe fact that they take more time to process than paper bills is undoubtedly their biggest flaw. The validate that the available funds are available even before the EFT payment can be sent.major weakness, which may annoy clients accustomed to quick pleasure, is that it can take a few days to settle.


  1. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2129870
  2. https://www.kansascityfed.org/documents/7579/psrb20zubradt0219.pdf