Electronic data transfer (EDT) is the umbrella term for any digital movement of files or structured records from one system to another. A bank sending an ACH payment file to a clearing house is EDT. A retailer sending a purchase order to a supplier is EDT. A data warehouse pushing an export to a partner's cloud storage, or one app sending a record to another over the internet — all EDT. The phrase covers every one of them, which is exactly why it turns up in compliance documents and exactly why it is rarely the most useful label for any one job.
The useful question is never "what is EDT." It is "which method should move this data, to this partner, with this much sensitivity." This guide explains the methods that actually run in production, the security each one needs, and how to choose between them when you have a real transfer in front of you.
Electronic data transfer is the act of sending digital information — a file, a payment, a structured record — between two computers over a network. The network can be wired or wireless, and the transfer can use any of several methods. What every method has in common is a sender, a receiver, and a set of rules (a protocol) they both agree to follow so the data arrives intact and only the right people can read it.
Think of it like mailing a package. The package is your data. The protocol is the agreement about how it gets addressed, sealed, and handed off. Different shipments call for different handling — a postcard, a tracked parcel, an armored courier — and EDT works the same way.
Most production EDT runs over one of a handful of methods. Each suits a different kind of data and a different relationship between the two systems.
FTP and SFTP — FTP (File Transfer Protocol) is the decades-old standard for moving files between two machines over the internet. It sends everything in plain text, so on its own it is not secure. SFTP (SSH File Transfer Protocol) does the same job but wraps the whole session in encryption, so credentials and files can't be read in transit. SFTP is the workhorse for partner file exchange.
Electronic Data Interchange (EDI) — EDI is a standardized format for the structured business documents trading partners exchange constantly: purchase orders, invoices, shipping notices. Instead of emailing a PDF a human has to retype, EDI sends a machine-readable record (an "EDI 850" is a purchase order, an "EDI 810" an invoice) that the receiving system files automatically. EDI commonly travels over a secure protocol called AS2 (Applicability Statement 2), which adds encryption and a signed receipt proving the document arrived. It is the backbone of supply chain, retail, and logistics.
Application Programming Interfaces (APIs) — An API lets two software systems talk to each other directly and on demand, usually exchanging small structured messages in near real time. When one app updates a record in another the instant it changes, that's an API call doing the work.
Cloud sync services — Tools that keep a folder identical across machines and people, like Google Drive, Dropbox, or OneDrive. They are built for collaboration and convenience rather than for governed partner exchange.
Inbound file requests and email attachments — The simplest method: someone attaches a file and sends it. It still happens everywhere, but it falls down on large files, on sensitive data, and on any transfer that needs an audit trail.
Network file shares — Shared drives inside a single company network, where many people open the same files. Useful internally; not a way to reach an outside partner.
The right choice depends on the data and the relationship, not on which method is newest. A nightly batch of files to a long-standing partner is an SFTP job. A retailer's purchase orders are EDI over AS2. A live lookup between two apps is an API call.
Every transfer is a moment when data is exposed, so it can be intercepted, altered, or stolen if it isn't protected. Four controls cover most of what matters.
Encryption in transit and at rest. Scramble the data both while it moves and while it sits on disk, so anyone who grabs it sees nothing usable. Modern transfers use AES-256 encryption at rest and TLS (the same encryption your browser uses for https://) in transit.
Authentication and access control. Confirm that each side is who it claims to be, and grant each account only what it needs. Multi-factor authentication, role-based permissions, and SSH keys all do this job.
Data integrity checks. Verify the file that arrived is byte-for-byte the file that was sent. A checksum — a short fingerprint computed from the file — flags any corruption or tampering before the data is trusted.
A secure protocol end to end. Use SFTP, FTPS, HTTPS, or AS2 rather than plain FTP, so the channel itself is protected and not just the storage on either end.
The harder problem is proving all of this happened. An audit log that records every login, upload, and download — who, what, and when — is what turns a secure transfer into a compliant one. For teams under HIPAA, SOC 2, or GDPR, that record is the difference between passing an audit and scrambling through it.
Almost every industry runs on EDT, usually without calling it that.
Healthcare moves patient records, lab results, and insurance claims, all under HIPAA rules that demand encryption and a full audit trail.
Finance and banking sends payment files, settlement data, and trade confirmations, where a single late or altered file has real money attached.
Retail and e-commerce runs on EDI: purchase orders, invoices, and shipping notices flowing automatically between retailers and suppliers.
Manufacturing and supply chain coordinates parts, shipments, and supplier data, again largely over EDI.
Government shares data between agencies under strict handling and compliance requirements.
When you have a specific transfer to set up, a few questions point you to the right method.
How sensitive is the data? Confidential records demand encryption and tight access control — SFTP, AS2, or HTTPS, never plain FTP.
How fast does it need to be? A live, on-demand exchange wants an API. A scheduled batch is fine over SFTP.
Who is the partner, and what do they already run? A retail partner almost certainly speaks EDI over AS2. A long-standing data partner may already have an SFTP endpoint. Match what exists rather than forcing a new method on them.
Will it grow? A transfer that runs once is one thing; a transfer that becomes fifty partners and a thousand files a night needs automation and central oversight, not a script on someone's laptop.
What does compliance require? GDPR, SOC 2, and HIPAA each set rules on how data is handled and proven. The method has to leave the record an auditor will ask for.
The trouble is that most organizations answer these questions one transfer at a time, and end up with a different tool for each: an SFTP server here, an AS2 connection there, a sync app, a pile of scripts, and no single place that shows what moved. Each piece needs its own patching, its own access list, its own audit export. The real modernization project is rarely about a single protocol — it's about pulling every method onto one platform.
Most teams that have outgrown a drawer full of separate transfer tools have moved to a single File Orchestration Platform: one platform that replaces the stack of legacy tools IT teams run to move files — SFTP and FTP servers, EDI and AS2 connections, file-sharing apps, and the custom scripts holding them together. It speaks every protocol, connects 50+ cloud and on-prem systems, automates every transfer, and keeps a complete audit trail in one place.
Files.com is that platform for over 4,000 organizations. Your partners keep using whatever they already run — SFTP, FTP, FTPS, HTTPS, AS2 for EDI, or a documented REST API — while you manage all of it from one console, with no server to patch. A file arriving over any method can trigger an automated workflow on its own: route it, transform it, notify a system, hand it off. Every action is logged for SOC 2 Type II and HIPAA audits, and the storage underneath can be a cloud bucket you already own. (If you only need a one-time, cloud-to-cloud move of existing data rather than an ongoing platform, Mover, also part of Files.com, does exactly that.)
To see how every form of EDT runs in one place, explore Files.com's AS2 and EDI support or start a free trial — no credit card, live in minutes.
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