Share this article If you liked this article share it with your friends.
6 min read

Wire Transfer vs Bank Transfers

Our Editorial Standards

In a global world, sending and receiving money has become a mundane part of life. Business transactions, international payments or personal payments are increasingly common. It creates the need for a reliable and efficient way to transfer funds.

When there are two things that associate with money transfers: wire transfers and bank transfers. These names sound very similar, but these transfers have different characteristics and can impact your money transfer experience.

In this blog article, we will look at bank and wire transfers, discussing their similarities, differences, and principles of operation. We will compare a wire transfer vs a bank transfer, looking at their speed, security features, and convenience.

Finally, you will understand when and why you should choose a bank or a wire transfer so you would make informed decisions while managing your financial transactions.

Electronic funds transfer

An electronic funds transfer (EFT) is simply an online transfer. It happens when you transfer your money from one bank account to another online. It involves the exchange of funds through computer systems and networks. Electronic fund transfers allow individuals, businesses and organisations to transfer money quickly and securely.

You can use electronic money transfers for various purposes. You can make payments, receive salaries, make online purchases or transfer funds between accounts.


Wire transfer vs bank transfer

Bank wire transfers

Wire transfer is a popular form of electronic payment. These transfers let you move money from one bank account to another. The banks act as intermediaries in the transaction process.

Wire transfers allow you to move big amounts of money quickly and securely. You can use it to down on mortgage payments or real estate transactions.

Banks, credit unions and other financial service providers facilitate wire transfers. The process for domestic wire transfers and international wire transfers may differ. Transfer fees are also often applicable.

The SWIFT network system also plays an essential role. By connecting several banks and financial institutions around the world, it facilitates international money transfers.

On the other hand, Europeans mainly use the International Bank Account Number Network (IBAN) for bank transfers.

Although bank transfers allow faster transfers of funds, their speed and convenience make them more costly.

ACH transfers

Bank transfers are an electronic payment method. It lets you transfer money between accounts. Automated Clearing House (ACH) transfer is a type of bank transfer. It is one of the most popular and used local bank transfers.

ACH transfers facilitate the smooth transfer of funds between different financial institutions, such as banks and credit unions, using a dedicated electronic network. This method has many applications. Due to its features, it is popular between consumers and businesses.

ACH transfers have a variety of purposes. They are suitable for:

  • Direct payroll transfers
  • Government benefits or tax refunds
  • Recurring debits
  • One-off bill payments
  • International transactions
  • Person-to-person payments
  • B2B transactions
  • Payments for healthcare services

ACH transfer is a popular solution when it comes to paying bills or transferring money to friends and family.

Notably, ACH transfers have become an integral part of various fintech payment applications. It indicates their reliability and versatility in the modern financial space.

It is crucial to distinguish ACH transfers from other electronic payment methods. ACH payments and wire transfers are not the same, nor are card payments.

ACH falls under the broader category of electronic funds transfers (EFTs). However, not all EFTs use ACH. The transactions for debit and credit cards are electronic payments that do not use the ACH network.

Wire transfer vs bank transfer: how they work

How do bank wire transfers work?

The person initiates the bank wire transfer by sending money to the receiver’s bank. The money then forwards to the recipient’s bank and finally to the recipient.

When initiating a wire transfer, the bank account holder provides specific details to their bank or third-party payment service.

These data include:

  • amount of money
  • the bank account number of the person sending the money
  • the contact details of the payee
  • the receiver’s account number
  • the order number of their financial institution or the SWIFT code (especially in the case of international transfers)
  • the physical address of the source bank

Once the bank or payment service receives this information, it can start processing payments. The money is withdrawn from the sender’s account and paid into the recipient’s account.

It is worth noting that there are wire transfer fees. When transferring money, the sender assumes responsibility for the costs of the transaction.

Unlike other transfer methods, the two bank accounts participating in international wire transfers do not need to be linked. The sender’s bank checks the availability of funds and, using systems such as SWIFT, transmits the transfer information to the recipient’s bank, instructing it to credit the transferred funds to the recipient’s account.

How do ACH transfers work?

The ACH network is a network of banks and financial institutions. It is responsible for transferring funds between banks.

Direct deposits include various payments, including regular payments, tax refunds and interest or annuity payments. These deposits are usually not received from individuals but from public bodies or companies.

Meanwhile, direct payments involve the transfer of funds between bank accounts using a credit and debit system. The money is withdrawn from the sender’s account and transferred directly to the recipient’s account.

The mechanism of an ACH transaction consists of several steps.

First, the originator or first bank initiates the ACH transfer. Then, it is merged with other ACH transfers. Finally, the money transaction is processed through a clearing house.

Ultimately, these transfers go in batches to the receiving bank. The receiving bank then credits or debits the relevant bank accounts as appropriate, thus completing the ACH transaction.


Wire transfer vs bank transfer: key differences


Speed is often the main factor. The time it takes for a payment to reach the recipient can vary. Domestic bank transfers can be fast.

Usually, wire transfers reach their destination the next working day or even the same day. On the other hand, bank transfers take a little longer. Typically, you receive funds within 1-3 days, and most transfers are completed within 24 hours. However, if you want your bank to process your transfer on the same day, it is essential to meet the deadlines. The deadline is usually no later than 15.00 Eastern Time.

For international bank transfers, the time taken can vary from 1-3 days to a week. The duration often depends on the destination country.

However, you can always find information about the electronic transfer duration on the bank’s or payment service provider’s website.

Transfer fee

The cost of an electronic transfer can be different. Factors such as the amount and type of transfer, and international transfers determine the size of charges.

Usually, the person who sends money pays a wire transfer fee, but recipients may also pay a small fee to receive the funds in their bank accounts.

Bank transfers are the cheapest option. Banks do not charge fees for sending or receiving money transfers. Anyway, the bank transfer fee is usually lower than for wire transfers. Wire transfer fee ranges between $25-$50.


ACH and wire transfer limits may vary depending on factors: day, month, bank account or transfer method.

Generally, wire transfers are subject to higher transfer limits. Nevertheless, to initiate a money transaction you may need to contact the bank. For example, if you are paying online for a specific property, you may have a limit of USD 500 000. However, you can visit a branch or make a phone call to the bank to change the limit on the amount of money you can send.

On the other hand, bank transfers usually have lower limits. The specific limits may differ. It depends on the nature of the transfer. Sending money to a linked recipient’s bank account usually has higher transfer limits.

It is advisable to check with your bank or financial institution for specific ACH or wire transfer limits.

International money transfer

You can send money domestically by both bank transfers and ACH transfers. Domestic payments usually use local payment schemes. Domestic wire transfers are primarily for transactions within a single country. ACH payments are a regular option for domestic wire transfers in the United States.

International wire transfers are made through networks such as SWIFT, SEPA and other messaging systems. Therefore, you can send money across borders.

Wire transfers are suitable for international and domestic transfers, while bank transfer is for domestic transactions. Thus, wire transfers are the only option for international wire transfers.

However, ACH has a partner network, Global ACH, which facilitates international wire transfers between banks. In addition, some other forms of bank transfers are also available for sending money abroad.


Is bank transfer or wire transfer faster?

In general, wire transfers are faster than bank transfers.

Wire transfers are often made on the same or next day, especially when it comes to domestic wire transfers.

In contrast, bank transfers, such as ACH transfers, can take longer. It usually takes several business days to receive funds.

Why is wire transfer better?

When it comes to wire transfer vs bank transfer, wire transfer is seen as a better option. It is due to faster processing times and greater availability. Wire transfers have a higher speed and, therefore, are more suitable for urgent transactions.

Moreover, you can make both international and domestic wire transfers. In contrast, you can only make a domestic bank transfer.

Is a wire transfer a SWIFT transfer?

Yes, you can make a wire transfer via the SWIFT.

Read more

Živilė Šarkauskaitė

Živilė is a writer with a diverse background, having worked with tech start-ups and pioneering brands across various industries. Her profound interest in progress and innovation drives her to the field of Fintech, a realm that sparks her curiosity and inspires her to share insights with others.

Info Icon


Please be advised that the information presented in this article is intended for general informational purposes only. It should not be construed as professional advice from swissmoney. It is important to note that swissmoney does not act as a financial adviser, and individuals are strongly encouraged to seek independent advice from qualified legal, financial, or accounting professionals before making any decisions related to cryptocurrency investments. Furthermore, investing in cryptocurrency assets carries inherent risks, and individuals should be aware that they may potentially lose all of their invested capital.

Explore related articles

Get app
We use cookies

swissmoney companies use cookies to provide you with tailored information about our services and to improve the performance of our website and (or) app. If you agree to all cookies used, please click on the "Accept" button. If you wish to change your cookie settings, please click on the "Choose cookies" button, and if you wish to refuse all of these cookies, please click on the "Reject" button. Your cookie preferences will be stored for one year.

Important: Some cookies are essential for the proper functioning of this website. The use of these cookies is based on legitimate interest and therefore consent to their recording is not requested. For more information, see swissmoney Cookie Statement.