A digital transfer of funds from one bank account to another is known as an electronic funds transfer (EFT), sometimes known as a direct deposit. These transfers are conducted without the involvement of bank workers. It is a digital transaction. Thus no paper documentation is required.
Due to its ease of use, accessibility, and directness, EFT has surpassed other money transfer methods as the most popular choice. Paper checks becoming less and less common as firms use EFT more frequently because it is cheaper, faster, and requires less labor overall.
An EFT transfer is typically extremely simple. The sender of the funds and the recipient of the payments are the two persons involved. When a sender requests a transfer, the request travels from the sender’s bank to the receiver’s bank via a number of digital networks that can either be connected to the internet or come from a payment terminal.
Senders can range from an individual paying a vendor for a service like energy to an employer, a business, or both.