In this article
In the United States, use ACH for a routine payment that can wait a banking day and where a right to correct errors is welcome, a wire for a large payment that must be final the same business day, and an onchain payment when the money has to move outside banking hours, across a border, or to several parties at once. The three differ on six things that matter more than the fee: when the payee has the money, whether it can come back, how much the rail will carry, what information travels with it, who is able to send it, and what proof it leaves.
This article compares two United States bank rails, ACH and the wire carried over the Federal Reserve's Fedwire Funds Service, with a payment made onchain in a dollar stablecoin on Ethereum. It is general information, not legal or financial advice. Network rules are quoted from the pages of Nacha, which writes the ACH rules, and of the Federal Reserve; your own bank sets its cut-off times, limits and fees inside those rules.
Nacha rule page on reversals; Federal Reserve Banks' Fedwire operating hours; Ethereum Foundation documentation.
How does each payment work, step by step?
An ACH payment travels in a batch file from the payer's bank through an operator to the payee's bank, a wire is a single message settled at once across the banks' accounts at the Federal Reserve, and an onchain payment is a transaction signed by the payer and written into a shared ledger. The table follows one supplier invoice, paid as a credit pushed by the payer, through the same five stages on each rail.
| Stage | ACH credit | Wire | Onchain payment |
|---|---|---|---|
| 1. Details | Payer holds the payee's routing and account numbers | Payer holds the payee's routing and account numbers and name | Payer holds the payee's address and knows the network and token |
| 2. Instruction | Payer uploads or keys the payment at its bank before the cut-off | Payer submits a wire request; the bank applies its approval controls | Payer signs a transfer from its own wallet |
| 3. Transport | The bank places the entry in a file sent to an ACH operator | The bank sends one message over Fedwire | The transaction is broadcast and included in a block |
| 4. Settlement | The operator sorts the file; banks settle at set times on the settlement date | The Federal Reserve debits one bank's account and credits the other's, at once | The ledger debits one address and credits the other; the block is later finalized |
| 5. Receipt | The payee's bank posts the credit to the account | The payee's bank credits the account and advises the payee | The balance sits at the payee's address, visible to both sides |
Nacha calls the payer in the ACH column the Originator. Two operators sort the files, the Federal Reserve and The Clearing House; Nacha governs the network and does not process the payments itself.
ACH also runs in the other direction, which the other two rails do not. In an ACH debit the payee is the Originator: holding an authorisation from the payer, it sends an instruction that pulls the money from the payer's account. A wire and an onchain payment are push-only; nobody can collect on either without the payer acting each time.
How do ACH, wire and onchain payments compare on the same criteria?
On the same eight criteria, ACH is the low-cost batch rail with return rights, the wire is the same-day final rail with banking hours, and the onchain payment is the always-open final rail that sits outside the banking system.
| Criterion | ACH | Wire (Fedwire) | Onchain payment (Ethereum) |
|---|---|---|---|
| Speed | Same day, next banking day or two banking days | Immediate once processed | Included in seconds, finalized in minutes |
| Operating hours | Banking days; settlement four times a day | 9:00 pm ET the evening before to 7:00 pm ET, Monday to Friday | Every hour of every day |
| Shape of the cost | Small flat fee per entry | Flat fee per transfer, often on both sides | Network fee, plus conversion if either side wants bank dollars |
| Network amount limit | $1 million per Same Day ACH payment since March 18, 2022; none published for next-day entries | None stated by the Federal Reserve | None in the network |
| Reversibility | Returns and reversals under the Nacha rules | Final and irrevocable once processed | Final once the block is finalized |
| Information carried | Payment fields plus remittance records, depending on format | Structured payer, payee and remittance fields | Sender, recipient, token and amount only |
| Who can send | Any business whose bank lets it originate | Any bank customer with wire access | Anyone holding the token and able to pay the network fee |
| Proof left | Bank statement entry and trace number | Bank confirmation and wire reference | Public transaction record that either party can look up |
The dates are those of the sources. Nacha gives March 18, 2022 as the effective date of the $1 million Same Day ACH limit, for credits and debits alike, and says the operators assign next-day settlement to a larger entry. The Federal Reserve's description of the Fedwire Funds Service, on a page last updated in June 2024, states no amount limit. The bank's own limit for your account is the one you will meet first.
One difference of kind sits behind the table. ACH and Fedwire move bank money between accounts at regulated institutions. An onchain payment moves a token, and a business that keeps its books in bank dollars has to convert at one end or both, through a regulated provider, which adds a step, a cost and a counterparty.
How fast is each rail, and when is each one open?
A wire and an onchain payment both settle within minutes of being processed, but only the onchain payment does so at any hour; ACH settles on banking days at set times. The hour and day of the instruction therefore change the answer more than the rail's headline speed.
According to Nacha, ACH credits can settle the same day, the next banking day or in two banking days, debits settle the same day or the next banking day, and about 80% of all ACH payments settle in one banking day or less. Nacha's fact sheet adds that the network settles four times per banking day and does not settle on weekends or federal holidays. Same Day ACH payments settle at 1:00 pm, 5:00 pm and 6:00 pm Eastern.
The Federal Reserve gives the Fedwire business day as starting at 9:00 pm Eastern on the preceding calendar day and ending at 7:00 pm, Monday to Friday, excluding holidays. The Reserve Banks' schedule puts the cut-off for customer transfers at 6:45 pm.
Ethereum has no business day. The Ethereum Foundation's documentation divides time into slots of 12 seconds and epochs of 32 slots, which makes an epoch 6.4 minutes. A block becomes final when checkpoints are confirmed by votes representing at least two-thirds of the staked ETH, which in normal conditions takes about two epochs, or 12.8 minutes.
Take one invoice of $85,000 owed by a distributor to an equipment maker. Instructed on a Tuesday at 10:00 am Eastern, all three arrive the same day if the payer wants them to: a Same Day ACH credit settles in one of the afternoon windows, a wire is final as soon as the bank releases it, and an onchain payment is finalized before 10:15 am. A standard ACH credit settles on Wednesday.
Instructed on a Friday at 7:30 pm Eastern, the rails separate. The Fedwire customer cut-off passed at 6:45 pm, so the wire goes out on Monday. ACH does not settle at the weekend, so the earliest ACH settlement is also Monday. The onchain payment is finalized at about 7:43 pm on Friday. If Monday is a federal holiday, both bank rails move to Tuesday, and the onchain payment is still dated Friday.
Can an ACH, wire or onchain payment be reversed?
An ACH payment can be returned by the receiving bank or reversed by the sender in defined cases and within defined deadlines; a wire and an onchain payment are final once processed and come back only if the recipient sends the money back or a court orders it.
ACH has two distinct mechanisms, and they are often confused.
A return is sent by the receiving bank. It sends an entry back because it cannot be posted, because the account lacks funds, or because the account holder says the debit was not authorised. For an unauthorised debit to a business account, Nacha's rule pages give the deadline as the opening of business on the second banking day following the settlement date. For a consumer account, the return may be made until the opening of business on the banking day following the 60th calendar day after settlement, once the consumer has given the bank a written statement.
A reversal is sent by the Originator to correct its own mistake. Nacha's rule on reversals, in effect since June 30, 2021, permits it for a duplicate entry, an incorrect receiver, an incorrect dollar amount, and a wrong date: a debit set to settle earlier than intended or a credit set to settle later than intended. The reversal must reach the receiving bank within five banking days after the settlement date of the erroneous entry, carry the word REVERSAL in its description field, and match the original amount.
The same rule lists what a reversal is not for. A reversal is improper if it is made for any reason not expressly permitted, or because the Originator failed to fund the original entry. A reversal is therefore not a way to take back a correct payment after a dispute about the goods. The receiving bank may return an improper reversal, within two banking days for a business account.
A reversal is also not a guarantee. Nacha's guidance on reversals notes that if the funds are no longer in the account, the reversal is returned and the sender has not recovered the money.
A wire has no equivalent. The Federal Reserve describes Fedwire transfers as immediate, final and irrevocable once processed. An onchain payment is final in a technical sense: the Ethereum Foundation's documentation states that reverting a finalized block would require a party to commit to losing at least one-third of all staked ETH.
What happens when each payment goes wrong?
When a payment fails, an ACH debit comes back to the party that collected it, a wire sent to the wrong account stays there unless the receiving side cooperates, and an onchain payment sent to the wrong address can be returned only by whoever controls that address.
A returned ACH debit. Suppose the equipment maker collects the $85,000 by ACH debit on Tuesday, for settlement on Wednesday. Its bank credits the account on Wednesday. A return for an unauthorised debit to a business account may still arrive by the opening of business on Friday, the second banking day after settlement. If the maker shipped on Thursday, it has released the goods against money that can still be taken back. With an illustrative returned-item fee of $12, the exposure is $85,012.
A duplicate ACH credit. Suppose the distributor pays the $85,000 twice by ACH credit, both settling on a Wednesday with no holiday in the following week. The duplicate is a permitted reason for a reversal, and the reversal must reach the receiving bank by the following Wednesday, the fifth banking day after settlement. If the payee has already spent the money, the reversal is returned and the distributor is left with a claim against the payee.
A wire sent to the wrong account. Fedwire transfers are governed by the Federal Reserve's Regulation J, which incorporates Article 4A of the Uniform Commercial Code. Two of its provisions decide what happens next. Under section 4A-207, when a payment order names a beneficiary and gives an account number that belongs to someone else, the beneficiary's bank may rely on the number and need not check that name and number match, unless it knows they differ. Under section 4A-211, once the beneficiary's bank has accepted the order, a cancellation takes effect only if that bank agrees, and only where the order was unauthorised or resulted from a mistake: a duplicate, a payment to a beneficiary not entitled to it, or an amount greater than was due. The bank may then recover from the beneficiary to the extent the law of mistake and restitution allows.
In practice the sender's bank sends a recall request, and the outcome depends on whether the money is still in the account and whether the account holder consents.
An onchain payment sent to the wrong address. No rulebook applies and no operator can be called. If the address belongs to a known counterparty, that party can sign a transfer back, and nothing but its agreement is needed. If the address belongs to a stranger, recovery depends on finding and persuading that person, or on legal action. If no one holds the key to the address, the tokens stay there.
What information and proof does each payment carry?
An ACH payment and a wire carry structured data about the payer, the payee and the invoice through the banks, while a basic onchain token transfer carries only the two addresses, the token and the amount, with a public record that either party can verify without asking a bank.
ACH has business formats built to carry remittance records alongside the payment, though how much of that detail reaches the payee depends on the format the payer used and on what the payee's bank reports. A wire carries the payer's name, the payee's name and a free-text reference.
A token transfer has no invoice field. The payee sees an amount arriving from an address, and matching it to an invoice relies on what the parties agreed beforehand: a dedicated receiving address, an exact amount, or a payment request that links the transaction to a reference.
On proof, the positions reverse. A bank payment is evidenced by documents each side obtains from its own bank: a statement line, a trace number for ACH, a wire confirmation. An onchain payment leaves one record that both parties, their auditors and anyone holding the transaction identifier can read: the addresses, the amount, the block and its time. That record proves a transfer between two addresses, not who owns them, which is why the address belongs in the contract or the invoice.
Who can send each kind of payment?
Almost every United States business can send an ACH credit or a wire through its bank, and far fewer are set up to send an onchain payment, which requires holding the token, controlling a wallet and having an internal policy that allows it.
Reach is ACH's strength. Nacha reports that businesses sent 8.1 billion business-to-business payments over the ACH network in 2025, and every bank account in the country can receive one. To collect by debit, the business needs an authorisation from each payer.
Wires are available to nearly any business account, subject to the bank's approval controls and daily limits. Fedwire's own participants are institutions: the Federal Reserve describes the service as open to depository institutions and certain other financial institutions that hold an account with a Reserve Bank.
An onchain payment needs no permission from a network, which is not the same as needing no preparation. The payer needs dollar tokens, a small amount of the network's own asset to pay the fee, and people authorised to sign. The payee needs an address it controls and a way to account for what arrives.
What does the same payment cost by ACH, by wire and onchain?
With the illustrative fees below, a standard ACH credit is the cheapest at every size, a wire costs the same flat amount whatever the size, and an onchain payment costs almost nothing when both sides keep the tokens and scales with the amount when they convert to and from bank dollars.
The fees are assumptions chosen to show the shape of each cost, not market quotes: $0.50 for a standard ACH credit, $2.00 for a Same Day ACH credit, $28 for an outgoing wire and $15 for an incoming one, a network fee of $0.40 for the token transfer, and 0.10% for each conversion between bank dollars and tokens.
| Route | On $2,500 | On $85,000 | On $1,400,000 |
|---|---|---|---|
| Standard ACH credit | $0.50 | $0.50 | $0.50 |
| Same Day ACH credit | $2.00 | $2.00 | Over the $1 million limit |
| Wire, both sides | $43.00 | $43.00 | $43.00 |
| Onchain, tokens kept | $0.40 | $0.40 | $0.40 |
| Onchain, converted at both ends | $5.40 | $170.40 | $2,800.40 |
Read as a share of the payment, the wire's $43.00 is 1.72% of the $2,500 invoice and about 0.003% of the $1,400,000 one.
The converted onchain route moves the other way in dollars. Two conversions at 0.10% cost $2.50 each on $2,500 and $1,400 each on $1,400,000, so the total grows with the amount while the wire stays flat. With these assumptions the two lines cross at $21,300.
Illustrative worked example. Excludes the cost of waiting, any exchange-rate margin on a cross-border leg and each side's internal handling cost.
The chart applies only when both ends convert. A payee that keeps the tokens, or pays its own suppliers in them, does not pay the conversion.
Which rail fits which situation?
The choice follows from four questions asked in order: can the counterparty use the rail, does the amount fit, when must the money be final, and who should carry the risk of an error.
| Situation | Rail that usually fits | Why |
|---|---|---|
| Recurring supplier payments on known due dates | ACH credit | Lowest cost, universal reach, timing known in advance |
| Collecting from customers on a schedule | ACH debit | The payee controls the timing; the return window has to be allowed for |
| A large payment against delivery or signature | Wire | Final the same business day, with no return right for the payer |
| Up to $1 million needed today, at low cost | Same Day ACH credit | Settles in an afternoon window if the cut-off is met |
| A payment due at a weekend or on a holiday | Onchain payment | The only one of the three open outside banking days |
| A counterparty abroad already set up for dollar tokens | Onchain payment | No correspondent chain; conversion decides the cost |
| Money to be held until a condition is met | None of the three alone | That is the job of an escrow or settlement agent, who then pays out by wire or ACH |
The last row is a reminder that a rail moves money and does not decide when the money should move. Where a closing depends on conditions, the agent who holds and releases the funds does a job no rail performs. Many businesses also combine rails, collecting from customers by ACH debit and paying a large supplier by wire.
What changes when one payment has to be shared among several parties?
When one incoming payment is owed to several parties, ACH and wires carry it as one receipt followed by one outgoing payment per party, while an onchain payment can be divided among the parties in the same transaction.
On the bank rails, someone receives the full amount first and then pays the others: a seller who pays a broker, a lead contractor who pays subcontractors, an agent who disburses to several beneficiaries. Where that first recipient is a settlement agent or an escrow holder, the sequence is deliberate.
Where the parties only need the payment divided, an onchain payment router is another option. Shaka is one such router: each party's share is set as a percentage of the deal and can be signed by each recipient before the client pays, the client pays once, and every party, up to 20 recipients, is paid at the same moment in one final transaction. It routes the payment and never holds the funds. It is not an escrow service, a bank or a processor, and it does not fit a payment that must wait for a condition or a party that cannot receive onchain.
What should you settle with your counterparty before you send?
Before sending, the two sides should agree in writing on the rail, the exact destination, the moment the payment counts as made, who bears each fee, and what happens if the payment is wrong.
- The rail and the fallback. Name the rail in the contract or on the invoice, and a second one if the first is unavailable on the day.
- The destination. Write the routing and account numbers, or the address with its network and token, into a signed document, with the rule that any change must be confirmed by a named person on a known phone number.
- The moment of payment. State whether payment is made when sent, when credited, or when final: for ACH, after settlement or after the return window; for a wire, on the bank's confirmation; onchain, once the block is finalized.
- The fees. Say who pays the sending fee, the receiving fee and any conversion, so that the amount received matches the invoice.
- The error procedure. Agree whom to call and within what time if the amount, the date or the destination is wrong, and that a payment received in error is sent back.
On a wire or an onchain payment, the counterparty's willingness to send back a mistaken payment is the only return mechanism there is.
