Batch Processing: MFT vs. SFTP vs. FTPs

If you’re not familiar with batch processing, this is an effective method to process a large volume of data at once. Whether you own a small and medium-sized business (SMB) or enterprise, you may need to process and store thousands to millions of records each business day. Common examples of batch processing include a business processing payroll and item invoices. There are three main types of batch processing: MFT, SFTP, and FTP. Keep reading to discover what these data processing standards are to help you determine the best solution for your organization. 

What Is an MFT?

Managed file transfer (MFT) is a data processing solution that handles the whole file transfer process, including administration, auditing, data security, and workflows from a centralized interface. Unlike the limitations of SFTP, which only sends secure file transfers, MFTs offer several additional benefits regarding security, management, and scalability. Specifically, managed file transfer solutions help protect data at rest, schedule and automate batch transfers, encrypt files with current industry standards (e.g., Open PGP and AES), enable users to securely collaborate with others via on-site or off-site in the cloud, track file transfer activity to ensure compliance, report data processing, and more.  

While  MFT offers the same features as SFTP tools, MFTs provide a simplified file transfer process that easily integrates with most web- and cloud-based services, such as Dropbox, JIRA, OneDrive, and SharePoint. Indeed, this may appeal to organizations that want to avoid the hassle of using multiple tools or legacy scripts to maintain their batch processing operations. Furthermore, MFTs are ideal for businesses that need high-volume file transfer processing critical for their data utility. If an organization needs to maintain compliance, MFTs also offer compliance features that aren’t provided with most FTP products.   

What Is an SFTP? 

SSH file transfer protocol (SFTP) is a data processing solution that sends data securely over the Secure Shell (SSH) data stream to help protect an organization’s data. SFTP provides a higher level of protection compared to the standard FTP. Also, this data processing solution implements specific algorithms designed to encrypt files transmitted between organizational systems, such as AES and Triple DES. Depending on an organization’s use case, they may prefer to use SFTP to increase their data’s security while in transit. Also, this solution can help those that must meet compliance regulations, such as PCI compliance or HIPAA compliance. 

As for data authentication, business owners have several choices. Indeed, SFTP users can test a connection with a standard user ID and password or something more complex like an SSH key (password and SSH key). A key benefit of having more authentication choices is that organizations can establish more robust security layers when transferring files and granting user access to those files. For businesses that need a simple, affordable, and quick solution, there are free options like FileZilla and However, if you need specific services, such as automation, auditing, and management, there are more expensive yet suitable SFTP solutions like WS_FTP Server.   

What Is FTPs? 

File Transfer Protocol (FTP) is a standard protocol to transfer files between computers. FTP was established in 1971, way before most people have used computers. This solution was a basic approach to moving files from one computer to another. This protocol is built on a client-server framework and is designed to work well for simple file transfers, such as bulk transfers or large files. While FTP has been upgraded to include SSH and SSL, this protocol is considered a security and compliance liability for businesses that regularly transfer sensitive data, such as proprietary or confidential documents. Compliance auditors are concerned about organizations that only use FTP to transmit sensitive files, which have security vulnerabilities that cybercriminals can exploit.  

As mentioned above, a significant issue with FTP is that it was never designed with security in mind. Unlike MFT and SFTP, FTP lacks data protection methods like encryption to create secure data transfers. Indeed, FTP only has a server connection point, in which it sends “clear” or insecure data via network lines. This is a serious security risk for businesses because data can be intercepted via an FTP connection. This data may include usernames, passwords, and files, which can be accessed immediately if compromised. Further, the sender and receiver have very little control over any transmitted data. With FTP, the sender sends data to an endpoint, and the receiver receives it.  

Which Batch Processing Should I Use? 

After discussing these three types of batch processing, we hope you have a better understanding of what MFT, SFTP, and FTP are, how they work, and the benefits of each. The best data transfer solution will significantly depend on the type of business you own and your specific use case.  

At TokenEx, we provide MFT, which customers primarily use to send sensitive data to us. This batch processing is an effective approach to sending large files containing multiple sets of sensitive data to be tokenized. A use case example would be using batch tokenization to transfer large volumes of transactions without storing this data in its sensitive form, thus reducing scope.  

When batch payments are processed, we receive the client’s tokenized batch files via SFTP, exchange the tokens with the appropriate data, encrypt the file with the payment processor’s public key, and then send it to the recipient. Then, the payment processor or third-party encrypts the settlement files with the TokenEx public key and sends them to TokenEx to be retokenized. Thus, this secure process prevents sensitive data from re-entering a client’s environment. If you would like to learn more about batch processing, contact TokenEx today, a leading cloud-based Data Protection platform on a mission to partner with our clients to secure their sensitive data while enabling their most critical business processes. 



Topic(s): data security