What is Managed File Transfer & Why Does It Beat SFTP

What Is Managed File Transfer & Why Does It Beat FTP?

With the FBI wary of FTP, managed file transfer has become the new file transfer solution. Let us help you understand MFT, its benefits and best practices.

What is MFT? Managed file transfer (MFT) is software that securely manages both internal and external data transfers. Compared to FTP, MFT includes encryption, automation tools, and IT security controls integration while also offering many security and compliance upgrades.

What is managed file transfer and why is it important?

MFT represents an evolution in file management technology, specifically for SMBs and enterprise customers with data needs related to compliance or high-volume data transactions.

File management has always been a challenge for public networks for four major reasons:

  1. Security. Sending data over public networks like the Internet exposes that data to unlawful access or theft. This exposure is a problem under normal circumstances, but even more so for businesses in industries like medicine, government, or other regulated spaces where handling Personal Identifiable Information (PII) or Personal Health Information (PHI) is common.
  2. Compliance. Sending PII, PHI, or even federal data over a public network doesn’t just involve security, but regulatory compliance too. And old, unsecured File Transfer Protocol (FTP) connections risk compliance breaches and possibly even fines.
  3. Management & Automation. Many transfer protocols lack a certain robustness in terms of managing them. Common protocols like FTP don’t allow users to administer aspects of transfers like data transparency or workflows.
  4. Visibility. An MFT solution with advanced controls can also provide critical visibility for your data. That includes both analytics to support understanding data flows and access as well as methods to make data transparent across different departments or areas of emphasis in your organization.

MFT offers a solution where both security and management are taken care of so that users with specific data requirements can better handle their information transmission.

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Advantages of managed file transfer vs. FTP

To better understand MFT, it’s important to understand it as an evolution of file protocols, specifically FTP.

File Transfer Protocol (FTP) is one of the earliest standards for transferring files between two computers. It’s built on a client-server framework and works well with simple file transmissions, especially bulk transfers of large files.

One of the limitations of FTP is that it is inherently insecure. This fact isn’t necessarily due to a flaw in the technology, but rather due to the fact that FTP was never built with security in mind. FTP doesn’t include encryption or authentication methods, other than what would be included by a server connection point, sending “clear” data across network lines.

What does that mean for you? It means that any intercepted data sent over an FTP connection, including passwords, usernames, and file data, can be read immediately. It also means that the sender and receiver have little control over the data as it is sent. You simply send the data, and the receiver receives it.

Advantages of managed file transfer vs. SFTP

To address some of the security limitations, several alternatives were developed, including an extension of FTP to include tunneling SSH encryption, called SSH (or Secure) File Transfer Protocol (SFTP).

SFTP is usually a good solution if you need something simple, inexpensive, and quick. Many free tools like FileZilla or even operating system-specific tools can support SFTP.

When thinking about managed file transfer vs. SFTP, however, you’re going to have to think past basic security and into the realm of file documentation and accountability. This means thinking about features like:

  • Workflow management
  • Security
  • Administration
  • Auditing

What MFT offers of SFTP is what many businesses want: more control over their files. More importantly, the types of controls that MFT offers can go a long way in supporting compliance for companies in regulated industries. Free SFTP tools just aren’t going to do that.

How does MFT help me with security and file management?

MFT was purpose-built to handle the challenges of secure file sharing, and it does so by combining security protocols with robust administration tools:

  1. Security: MFT solutions will invariably include at least one (but typically multiple) security protocols to encrypt data during transmission. Some of the more common security protocols you might find in an MFT solution are:
    1. Secure FTP (SFTP)
    2. Hypertext Transfer Protocol HTTP and Secured HTTP (HTTPS)
    3. Odette File Transfer Protocol (OFTP)
    4. Secure Copy Protocol (SCP)
    5. Applicability Statement 2 (AS2) specifications

Because of the variety of protocols available, many MFT solutions are suitable for regulation-compliant file transfers in multiple industries over public and private networks.

  1. Management: MFT will also give your organization several levels of control over file management, including:
    1. Reporting successful or failed file transfers
    2. Implementing non-repudiation measures for user and authorship verification
    3. Creating audit trails for data transfers
    4. Automating file sharing through workflows
    5. Managing data and data transfer visibility across a network
    6. Gathering data for metrics and performance measurements
    7. Automating tasks like alert emails and logging based on file sharing activity

How does MFT help with compliance?

Compliance is a major concern for many companies, particularly those in regulated fields. That’s why MFT is an excellent pick for businesses in these industries who want to ensure that their file management methods keep them compliant.

Some of the industries where MFT supports compliance are:

  • Healthcare: MFT supports end-to-end encryption and is an absolute must for HIPAA and HITECH compliance. More importantly, MFT supports features like non-repudiation that meet requirements for reporting and privacy in healthcare law as well.
  • Government: A robust MFT with high-level security will help your organization meet compliance with regulations like the Federal Information Security Management Act (FISMA). This is critical if your company offers solutions or data platforms for government agencies or contractors.
  • Retail: PCI-DSS compliance dictates that merchants transmitting or storing customer data and payment information on public networks need to have encryption controls in place. MFT can serve as the backbone of a scalable transfer solution that is secure in this kind of environment.
  • Corporate Transparency: The Sarbanes-Oxley Act of 2002 established a series of regulations on how corporations maintain accurate documentation on things like financial reports, security policies, and regulatory compliance. MFT supports SOX compliance with included controls like automated logging and non-repudiation features.

Compliance is not something to cut corners on. In some industries, especially healthcare, penalties for non-compliance can be steep, if not ruinous.

What should I look for in a MFT solution?

If you’re in the market for an MFT solution, then there are several capabilities to look out for that align with security, file management, and compliance:

  • Robust automation. A solid MFT file transfer solution should include tools to automate key jobs, like batch file transmissions, data logging, and scheduling.
  • Simple interfaces for secure transfers. An MFT solution that’s secure is one thing. A secure MFT platform that makes it easy to securely share files with external stakeholders in another. Find a platform that makes it easy to share files without compromising security.
  • Integrated auditing and compliance features. Compliance audits can be a full-time job, depending on the industry you work in. Having an MFT solution that integrates audits, reporting, and compliance with a security framework can make that job much easier. Bonus points if the solution has a white-glove service to help you with that integration across your organization.
  • Data visibility across an entire organization. Stay on top of compliance issues or SLAs with your customers or vendors. Have a clear view (ideally through a simple dashboard) of what is happening where and the kinds of workflows your operations are running.
  • Compliance. This might sound repetitive, but do not buy a solution that cannot support compliance in your industry. MFT can help you protect user and business data, but you have to find one that supports the level of security and data management you need.

Managed file transfer solutions make you agile, transparent, and compliant

If you want security, control, and compliance, then there are simply better tools than FTP and SFTP for transferring files. An MFT solution can offer your organization exactly what it needs to maintain control over file sharing and transmission without breaching regulations or the trust of customers, clients, or patients.

To learn more about MFT and how it can help your business, schedule a custom demo of Kiteworks today.

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