ACH & Wire Transfers

Understanding the two main domestic payment methods: speed, cost, and when to use each

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SWIFT Payment Network

Introduction to Domestic Payment Systems

When you need to move money domestically in the US, you have two main electronic options: ACH transfers and wire transfers. While both move money between banks, they operate on fundamentally different rails with distinct speeds, costs, and use cases.

The Quick Comparison

ACH (Automated Clearing House)
  • • Batch processing system
  • • 1-3 business days (or same-day)
  • • Low cost ($0.25-$2.50)
  • • Used for payroll, bills, recurring
  • • Reversible (pull-based)
Wire Transfer
  • • Real-time processing
  • • Same day (domestic)
  • • High cost ($25-$35)
  • • Used for urgent, large amounts
  • • Irreversible (push-based)

Why Two Systems?

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Efficiency vs Speed: ACH batches thousands of transactions for efficiency. Wires process individual transfers immediately for urgency.
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Cost Structure: ACH's low cost makes it ideal for regular, predictable payments. Wires justify their premium for time-critical transfers.
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Risk Management: ACH allows returns/reversals for fraud protection. Wires are final, requiring upfront verification but enabling certainty.
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Real-World Scale

ACH processes 30+ billion transactions annually worth $70+ trillion. Wire transfers handle fewer transactions but often larger amounts—think real estate closings, business acquisitions, and emergency funds.