What is electronic funds transfer (EFT) processing?
EFT, or electronic funds transfer, is a computerized system that performs financial transactions electronically without any paper money being sent from one bank to another. The use of electronic funds transfer has become more widespread with the personal computers, improved networking systems, and security features such as encryption. EFT processing is the process of transferring funds initiated by electronic means including ATMs, computers, telephones, point of sale systems, and other electronic terminals. Electronic finds transfers may also be referred to as automatic bill payment, automatic debit, electronic bill payment, or direct debit/deposit. Most users of EFT processing find it safe, efficient, and less expensive than using traditional paper checks. In fact, many institutions such as banks offer lower interest rates on loans or free services if customers use ACH/EFT processing. What type of transactions can be handled by EFT payments? EFT payments can be used for both debit and
