What Is MFT (Managed File Transfer)?

If you’re exploring data exchange solutions for your business, you’ve undoubtedly come across the term “managed file transfer.” But what is MFT, and what benefits does it provide?

Managed file transfer technology facilitates secure internal and external data transfer through your network. It helps your organization meet the ever-evolving operational and compliance demands associated with moving data through a network.

How is MFT used?

Managed file transfer software is primarily designed to transfer large batches of data or compliance-protected information. As such, many organizations pair it with another data exchange software, such as electronic data interchange (EDI) technology, for everyday communication.

Although there are many types of EDI, the basic function of all EDI formats is the same: These tools let you exchange routine business documents, such as invoices, purchase orders, and other standardized documents.

When used in tandem, these complementary solutions can support your operations and promote better communication with trade partners.

Primary components of an MFT

Typically, an MFT is composed of four elements:

• Server: The server manages all parts of the file transfer, including provisioning, workflows, APIs, protocols, and communication channels.
• Client: The client facilitates server integration.
• Proxy: A proxy conceals your IP address and ports to enhance security.
• Plug-ins: These are software that integrate the MFT with other applications.

5 benefits of managed file transfer

Managed file transfer solutions offer numerous benefits, including the following:

Improved data security 

A single data breach could be catastrophic for your organization. MFT technology helps insulate your business from digital threats while allowing efficient data transfer across the network.

Leading MFT solutions include validation security policies, controls, and real-time monitoring capabilities. Cumulatively, these provisions detect threats quickly and help you preserve your reputation.

Scalability

Like most businesses, your company is probably collecting more data than ever before. This trend shows no signs of slowing; if anything, the amount of data you gather will likely increase exponentially in the coming years.

MFT software allows you to efficiently move these larger files, even if you’re transferring them globally. The built-in governance capabilities of MFT software accelerate big-data movements without compromising security or integrity.

Enhanced regulatory compliance 

If you operate in a tightly regulated industry, you must adhere to relevant compliance standards. Otherwise, you could face severe penalties and damage relationships with your vendor partners.

MFT solutions support compliance by enabling you to encrypt, transmit, and continuously monitor sensitive data in accordance with regulatory frameworks. 

Visibility

Managed file transfer solutions provide optimal visibility into the flow of data. You can use these insights to mitigate the damage of attacks and resolve potential issues before they have a chance to wreak havoc.

Future-proofing

Cloud applications, data analytics tools, artificial intelligence solutions, and other cutting-edge technologies rely on data — lots of it. MFT lets you feed these programs’ insatiable appetite for data, meaning you can leverage the newest technology to support your company’s growth.

What to consider when choosing an MFT solution

A managed file transfer solution can be a valuable asset to your organization. However, choosing a platform that aligns with your industry’s unique needs is essential.

When choosing a solution, you’ll want to consider each of the following factors:

Security

Look for a solution offering end-to-end encryption for both external and internal file transfers. Ideally, you want your files encrypted both in motion and at rest.

Additionally, verify the platform includes inspection protocols and session breaks. These advanced capabilities will further bolster your security and keep your data safe. 

Simplified file transfer

Your managed file transfer software should simplify exchanges by supporting several file types, including XML, email, PDFs, and multimedia. Ensure your MFT solution is also EDI-capable software. 

Full visibility

At any moment, you should have access to a complete view of what's being shared, who’s transferring files, and the volume of data passing through the platform. A solution that offers end-to-end visibility will help you detect potential delays before they impact your business processes. 

Compliance

A platform with strong encryption will help you maintain compliance. You can avoid missing standards and paying the ensuing fines. Your MFT will also create an auditable trail so you can confirm regulatory compliance. 

MFT vs. SFTP: Which one is right for you?

Secure file transfer protocol (SFTP) is another popular data-processing and file-transfer solution that’s often mentioned in the same breath as MFT. However, there are significant differences between the two.

What is SFTP?

Secure file transfer protocol sends files through an encrypted connection between a client (the sender) and a server (the recipient). When setting up an SFTP, you can choose from several authentication methods, such as a user ID and password or a secure shell (SSH) key.

For years, SFTP was the go-to method for transferring data, including large files. However, some inherent flaws of SFTP make it far more vulnerable than modern solutions, including MFT.

Should you use MFT or SFTP?

MFT exceeds SFTP in virtually every way. As the name suggests, a managed file transfer system is “managed.” It has several built-in protocols, making it more secure and reliable than SFTP.

Specifically, MFT includes:

• Automation tools
• Digital signatures that prove who sent a file
• End-to-end reporting capabilities

MFT transfers are also auditable, unlike SFTP.

Go with MFT software if you need a safe, secure, and reliable way to transfer large data files internally or externally.

That being said, SFTP is still useful in specific situations. It can boost the security of small-scale, internal file transfers. For instance, if one of your marketing team members wants to send you a small PDF file, they could use SFTP. 

Ensure a smooth transfer of data with Orderful

Managed file transfer technology provides a safe and secure way to transport data across your network. Since it supports internal and external data sharing, it can be used for interdepartmental collaboration or to communicate with your trading partners. 

However, MFT is not the be-all-end-all solution for sharing data. To maximize communication with your partners, you need a tool for sending and receiving standardized documents. That’s where EDI comes in.

Orderful’s versatile solution supports all core EDI standards to facilitate smoother communication with your trading partners. To learn more, schedule a talk with an Orderful expert today!