Difference Between ACH and EFT


ACH and EFT are terms that are related to the transferring of money electronically. Today, handling cash or cheques seems an archaic process. The world is moving towards the direction of plastic for everyday use, and to help in this move, many methods such as ACH, or Automated Clearing House, and EFT, or Electronic Funds Transfer has been introduced.

What is ACH?

ACH refers to the electronic network of financial institutions in the US where ACH transactions are being processed in batches. The use of ACH has proven to be very useful in the past decade as it reduces the need for cheques and allows the convenience of paying a bill or receiving one’s pay checks in the comfort of one’s own home.

What is EFT?

EFT is the process that involves the transferring of money electronically between two or more parties, including not only ACH, but also POS transactions, paper drafts, and bill payments among others. Today, people are quite reluctant to handle cash, as the risk of it being lost is quite large. Also, when cash is lost, it is virtually untraceable. EFT provides a good solution for these issues and, therefore, is the best alternative for this problem.

What is the difference between ACH and EFT?

There is no doubt that EFT and ACH are making lives easier by simplifying monetary transactions. However, although ACH and EFT can stand for the same thing, it is important to know that they are different. EFT is a broad term and can be virtually used for every transfer of money that happens electronically. ACH, on the other hand, is a specific process of transferring funds electronically. It can be set-up to occur automatically in an account at a set date and is processed overnight in batches.  EFT, on the other hand, can happen within business hours, depending on the type of EFT.



• ACH and EFT are terms in relation to the transferring money electronically between people.

• EFT is the process of transferring money electronically while ACH is a network for financial institutions to transfer money electronically.