How to Choose a Managed File Transfer Solution

What Is Managed File Transfer?

Managed File Transfer is a category of software that handles the secure, reliable exchange of files between organizations, systems, and people. Unlike basic file sharing tools, MFT provides encryption, compliance tracking, and automation for sensitive data.

The core difference from consumer file sharing: MFT treats file transfers as business-critical operations that need monitoring, security controls, and audit trails. When a hospital sends patient records to an insurance company, or a bank transmits financial data to a regulator, that transfer needs to be encrypted, logged, and traceable.

MFT platforms typically support multiple transfer protocols:

• SFTP (SSH File Transfer Protocol) for secure server-to-server transfers
• FTPS (FTP over SSL) for legacy system compatibility
• AS2 for EDI transactions with trading partners
• HTTPS for web-based uploads and downloads

The MFT market continues to grow as data regulations get stricter and security requirements multiply.

When Do You Actually Need MFT?

Not every organization needs a full MFT platform. Here's how to tell if your situation calls for one.

You probably need MFT if:

• You exchange files with external partners regularly (B2B file sharing)
• Regulations require you to prove how data was transmitted and received
• You need automated, scheduled transfers between systems
• Files must flow between different protocols (SFTP to email, for example)
• Transfer failures could disrupt business operations

You probably don't need MFT if:

• Your file sharing is mostly internal team collaboration
• You share files with clients occasionally, not continuously
• You don't have regulatory audit requirements
• Your files don't contain PII, financial data, or trade secrets

The organizations that experience file transfer security incidents aren't necessarily using the wrong tools. Many are using email attachments, consumer cloud storage, or unencrypted FTP when they should be using something more secure.

MFT vs SFTP: What's the Difference?

This is one of the most common questions about managed file transfer. SFTP is a protocol. MFT is a platform that uses SFTP (and other protocols) while adding management capabilities on top.

Think of it this way: SFTP is a secure pipe for moving files. MFT is the control room that manages many pipes, monitors what flows through them, and keeps records of every transfer.

SFTP alone gives you:

• Encrypted file transfers
• Authentication via SSH keys or passwords
• Basic access to a remote file system

MFT adds:

• A dashboard to monitor all transfers across the organization
• Automation and scheduling without writing scripts
• Retry logic when transfers fail
• Detailed audit logs showing who sent what, when, and to whom
• Alerts when transfers fail or take too long
• Compliance reporting for auditors
• Support for multiple protocols from one interface

Running a single SFTP server for a small team? You probably don't need MFT. Managing dozens of automated transfers with external partners and proving compliance to auditors? That's where MFT pays for itself.

Key Features to Evaluate

When comparing MFT solutions, these capabilities matter most:

Security Controls

Look for encryption at rest and in transit, SSO integration with your identity provider, and granular permissions at the folder level. The ability to set expiration dates on shared links and revoke access instantly matters for sensitive deals.

Audit and Compliance

Every transfer should be logged with timestamps, user identity, and file details. You need to be able to pull reports for auditors without digging through server logs. Some industries require specific retention periods for these records.

Automation Capabilities

Can you schedule transfers? Set up triggers based on file arrivals? Handle retries automatically? Good MFT platforms reduce the need for custom scripts and manual babysitting.

User Experience

Traditional MFT platforms are built for IT administrators, not business users. If your marketing team or finance department needs to send files securely, they'll work around a clunky interface by using email instead. Find a solution that non-technical users can actually figure out.

Integration

How does the MFT connect with your existing systems? REST APIs, webhooks, and connectors to common business applications reduce the integration burden.

MFT for Different Use Cases

B2B Data Exchange

The traditional MFT use case. You're exchanging files with suppliers, partners, or customers on a regular schedule. AS2 and EDI support matter here, along with partner onboarding workflows.

Internal Secure File Sharing

Some organizations use MFT internally when data is too sensitive for standard collaboration tools. Research data, HR records, and financial reports often fall into this category.

Customer and Client File Collection

When you need clients to upload documents securely, like a law firm collecting case materials or a bank gathering loan documents. Look for branded portals and simple upload interfaces.

System-to-System Integration

Automated transfers between applications, often triggered by events in one system. This requires good API support and workflow automation.

For teams focused on collaboration and client file sharing rather than automated system integration, cloud storage platforms with strong security features can handle many MFT use cases without the complexity. Features like encrypted sharing, audit logs, granular permissions, and branded client portals cover the security requirements while keeping things simple.

How to Evaluate MFT Solutions

Before requesting demos, document your actual requirements:

Transfer Volume How many files per day? What's the largest file you'll transfer? Pricing often scales with volume.

Protocol Requirements List the protocols your partners and systems require. SFTP covers most cases, but B2B integration often needs AS2 or specific EDI standards.

Compliance Requirements Which regulations apply? Some MFT vendors specialize in specific industries (healthcare, finance) and have pre-built compliance controls.

User Population Who will use the system? IT staff can handle complex interfaces. Business users need something simpler. External partners need the simplest experience of all.

Integration Needs What systems need to connect? CRM, ERP, cloud storage, legacy applications? Check for existing connectors.

Questions to Ask Vendors

• What happens when a transfer fails? How are retries handled?
• How do users without accounts send files to us?
• What does the audit trail actually capture?
• How long does partner onboarding take?
• What's the pricing model as we scale?

Well-known MFT solutions include GoAnywhere MFT, Progress MOVEit, Axway, and Files.com. Each has different strengths depending on your protocol requirements, compliance needs, and deployment preference.