Electronic funds transfer is the electronic transfer of money from one bank account to another, either within a single financial institution or across multiple institutions, via computer-based systems, without the direct intervention of bank staff.

What is considered an electronic funds transfer?

Electronic funds transfer (EFT) is a transfer of funds is initiated through an electronic terminal, telephone, computer (including on-line banking) or magnetic tape for the purpose of ordering, instructing, or authorizing a financial institution to debit or credit a consumer's account.

How does an electronic funds transfer work?

An electronic funds transfer moves money from one account to another electronically over a computerized network. EFTs require both the sender and recipient to have bank accounts. The accounts do not have to be at the same financial institution to transfer funds. ... EFT transactions are also known as electronic banking.