# Funds Transfer > Funds Transfer means shifting funds electronically, initiated by an originator for the beneficiary's benefit. **Term:** Funds Transfer **Last updated:** 2026-07-29 ## Definition ## What Funds Transfer Means in a Contract Funds Transfer describes the electronic instruction and movement of money between accounts, typically through banks or payment intermediaries, so that a beneficiary receives payment owed under an agreement. Contracts use the term to describe the mechanism of payment rather than the payment obligation itself, distinguishing it from cash, checks, or other settlement methods. The clause usually identifies the originator, the beneficiary, the originating and receiving financial institutions, and the payment network or system through which the transfer travels. This framing matters because electronic transfers involve timing, fees, and irrevocability characteristics that differ from other payment methods, and the contract needs to allocate responsibility for each. Because funds transfers are often used to settle recurring or high-value obligations, agreements in