Banking
ACH vs Wire Transfer
Quick definition
ACH is electronic bank-to-bank transfer (1-3 days, low cost). Wire is real-time (same-day) with higher fees ($15-50).
ACH (Automated Clearing House): batch-processed electronic payments between US banks. 1-3 business days. ~$0.25-3 per transaction. Used for payroll, vendor payments, customer collections. Wire transfers: real-time settlement, higher cost ($15-50 outgoing), final and irrevocable. Used for time-critical or large transfers (deal closes, M&A). Wire fraud is irreversible — verify recipient details out-of-band before sending large wires.
Related banking terms
Treasury Management
The discipline of managing a company's cash, liquidity, banking relationships, and short-term investments.
Sweep Account
Bank arrangement that automatically transfers excess cash from a checking account into a higher-yielding investment account.
FDIC Limits ($250K)
Federal Deposit Insurance Corporation insurance covers $250K per depositor per FDIC-insured bank per ownership category.
Money Market Fund
Mutual fund holding short-term, highly liquid debt (T-bills, commercial paper, repos) targeting stable $1/share value plus yield.
Frequently asked questions
- What is ACH vs Wire Transfer?
- ACH (Automated Clearing House): batch-processed electronic payments between US banks. 1-3 business days. ~$0.25-3 per transaction. Used for payroll, vendor payments, customer collections. Wire transfers: real-time settlement, higher cost ($15-50 outgoing), final and irrevocable. Used for time-critical or large transfers (deal closes, M&A). Wire fraud is irreversible — verify recipient details out-of-band before sending large wires.
- Why is ACH vs Wire Transfer important for startups?
- ACH vs Wire Transfer is a banking concept that matters for startup founders because it directly affects fundraising readiness, financial decision-making, or operational discipline at the stage where mistakes are expensive to undo. Founders who understand it have a meaningfully easier time in diligence, board meetings, and investor conversations.
- What category does ACH vs Wire Transfer belong to?
- ACH vs Wire Transfer is a Banking term in the StartupCFO finance glossary — alongside other banking concepts that founders, CFOs, and accountants use in daily startup operations and reporting.
- Where can I learn more about ACH vs Wire Transfer?
- Beyond this definition, see the related banking terms below, or explore StartupCFO's insights and tools that put ACH vs Wire Transfer in context. For specific situations, talk to a fractional CFO who can walk through your numbers.
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