Quick Overview: ACH vs Wire for Businesses
At a high level, both ACH and wire transfers move money electronically between bank accounts. The main differences are:
- Speed: Wires are usually same-day or near-instant during banking hours; ACH is typically 1–3 business days (or same day for certain ACH windows).
- Cost: ACH is usually very cheap; wires are significantly more expensive per transaction.
- Use cases: ACH is best for routine, repeat payments; wires are best for high-value or time-sensitive payments.
- Reversals: ACH has limited reversal and dispute options; wires are often final once sent.
What Is an ACH Transfer?
ACH stands for Automated Clearing House, a batch-based electronic payment network used heavily in the United States. When you run payroll, pay a vendor using bank details, or pull a customer payment directly from their bank account, there is a good chance it is moving over the ACH network.
ACH transfers are commonly used for:
- Payroll and contractor payments
- Vendor invoices and recurring bills
- Subscription and SaaS billing
- Customer refunds or payouts
- Internal transfers between your own accounts
Typical ACH Timing
For most businesses, ACH timing looks like this:
- Standard ACH: 1–3 business days from initiation to funds availability
- Same-day ACH: Same day settlement if submitted before cutoff, still not truly instant
ACH batches are processed in windows throughout the day. You do not see money move in real time; instead, the receiving bank updates balances after the batch settles.
Typical ACH Costs
ACH pricing models vary by bank and payment processor, but common structures include:
- Flat fee per ACH transaction (for example, $0.10–$0.75 per item)
- Bundled ACH included with a monthly account or platform fee
- Tiered pricing based on volume
Because the per-transaction cost is low, ACH is attractive for businesses running a large number of relatively small payments.
What Is a Wire Transfer?
A wire transfer is a bank-to-bank transfer that typically moves funds more directly and more quickly than ACH. Wires are used when the amount is large, the timing is critical, or the payment is international.
Wire transfers are commonly used for:
- Real estate closings and escrow disbursements
- Large vendor prepayments or deposits
- Emergency or last-minute funding needs
- International payments where local ACH-like rails are not available
- Settling high-value B2B invoices
Typical Wire Timing
For domestic wires, timing is usually:
- Same business day if submitted before the bank's wire cutoff time
- Minutes to a few hours for funds to appear and become usable on the receiving side
International wires can take longer due to time zones, intermediary banks, and compliance checks, but are often still faster than waiting for international checks or slow local rails.
Typical Wire Costs
Wire fees are significantly higher than ACH fees. Common fee ranges include:
- Domestic outgoing wire: often $15–$30 per transfer
- International outgoing wire: often $30–$50+ per transfer
- Incoming wire: sometimes free, sometimes $10–$15 per transfer
Some premium business accounts may reduce or waive wire fees once you hit certain balances or fee tiers, but they are still almost always more expensive than ACH.
Side-by-Side Comparison: ACH vs Wire
| Feature | ACH Transfer | Wire Transfer |
|---|---|---|
| Speed | 1–3 business days (same-day available) | Same day, often within minutes |
| Typical Cost | Low (pennies to under $1) | $15–$50+ per transfer |
| Use Cases | Payroll, invoices, subscriptions | High-value, time-sensitive payments |
| Reversals | Limited reversal options exist | Generally final once sent |
| International | Mostly domestic; limited cross-border | Commonly used via SWIFT |
| Best For | High-volume, predictable payments | Lower-volume, urgent payments |
When to Use ACH for Your Business
ACH is usually the right choice when:
- You run payroll on a regular schedule
- You pay the same vendors or contractors every month
- You bill customers on a subscription or invoice basis
- You need to minimize payment processing costs
- The payment does not need to arrive within hours
Many businesses standardize on ACH as their default payment rail for everything that does not require wire-level speed. Over a full year, the savings compared to routine wires can be substantial.
When to Use Wire Transfers for Your Business
Wire transfers are usually the right choice when:
- The payment amount is high-value and you want rapid confirmation
- The money needs to arrive the same day or within a few hours
- You are working with a new or unfamiliar counterparty and want the certainty of a wire
- You are sending funds internationally where ACH is not supported
- A contract, closing, or settlement has a strict time-based funding requirement
Think of wires as your "express courier" payment option: they cost more, but they are fast and direct. You should reserve them for cases where those advantages really matter.
Cost Example: ACH vs Wire Over a Year
To see how big the difference can be, imagine a business that pays 50 vendors once a month. You have two options:
- Use ACH at $0.25 per transfer
- Use wires at $20 per transfer
Here is what the annual cost might look like:
| Scenario | Monthly Cost | Annual Cost |
|---|---|---|
| 50 payments via ACH | 50 × $0.25 = $12.50 | $150.00 |
| 50 payments via wire | 50 × $20 = $1,000.00 | $12,000.00 |
In this simplified example, the difference is $11,850 per year—just for choosing the more expensive rail for routine payments. That is why many finance teams standardize on ACH where possible and reserve wires for special situations.
ACH vs Wire vs RTP (Real-Time Payments)
In addition to ACH and wire, many banks are rolling out Real-Time Payments (RTP)and other instant payment options. These can move money nearly instantly, 24/7, but may have their own limits and fee structures.
At a high level:
- ACH: Slowest but cheapest for routine payments
- Wire: Fast and expensive, best for high-value or urgent payments
- RTP: Fast like wires, often priced closer to ACH for smaller amounts, but with limits and bank-by-bank availability
As RTP adoption grows, some businesses will shift small, urgent payments from wires to RTP, while keeping ACH as the backbone for predictable, recurring payments.
Key Questions to Ask Your Bank or Provider
Before you lock in your payment strategy, it helps to ask your bank or payment provider a few targeted questions:
- What are your ACH fees per transaction? Are there volume discounts?
- Do you support same-day ACH, and what are the cutoffs and costs?
- What are your domestic and international wire fees (outgoing and incoming)?
- Do you support RTP or other instant payment methods for businesses?
- Are there daily or per-transaction limits for ACH, wires, or RTP?
- Do you charge any monthly platform or treasury management fees?
Once you have these numbers, tools like our calculators can help you model real scenarios and choose the most cost-effective mix of ACH, wires, and instant payments.
Summary: How to Decide Between ACH and Wire
There is no one-size-fits-all answer, but you can use a simple rule of thumb to decide on a payment rail:
- If the payment is routine, predictable, and not extremely urgent → ACH is usually best.
- If the payment is large, time-sensitive, or international → a wire (or RTP, if available) is often worth the extra cost.
The most effective finance teams do not choose one rail for everything; they mix ACH, wires, and instant options based on the size, timing, and risk profile of each payment type.