SFTP vs FTP: Choosing the Right File Transfer Protocol for Your Business

The secure and efficient transfer of files between systems, partners, and customers is more than a technical necessity—it’s a business imperative. Organizations of all sizes rely on file transfer protocols to move data, and the choice between protocols can significantly impact security, compliance, and operational efficiency.

Two of the most common file transfer protocols are File Transfer Protocol (FTP) and SSH File Transfer Protocol (SFTP). While they may sound similar and serve comparable purposes, the differences between them are substantial, particularly when it comes to security and compliance requirements.

In this post, we’ll explore both protocols in depth, comparing their features, benefits, use cases, and security implications to help you make an informed decision about which technology best serves your organization’s needs.

What is FTP?

FTP, or file transfer protocol, is one of the oldest and most fundamental internet protocols, dating back to 1971. It was designed to facilitate file transfers between a client and server over a network. FTP operates on a client-server model and traditionally uses two separate TCP connections: a control channel (typically port 21) for sending commands, and a data channel (typically port 20 or a dynamically allocated port) for transferring files.

In its standard form, FTP transmits data in plain text, including usernames, passwords, and the actual file content. This means that without additional security measures, FTP traffic can be intercepted and read by malicious actors.

Benefits of FTP

Despite its security limitations, traditional FTP still offers several advantages in specific scenarios. Its straightforward design makes it easy to implement and use, particularly for basic file transfer needs. In some controlled environments, FTP can offer faster transfer speeds due to lower overhead from the lack of encryption, which can be beneficial for transferring very large files within secured networks.

FTP’s long history means it’s supported by virtually all platforms and operating systems, including legacy systems that might not support newer protocols. It typically requires fewer computational resources than encrypted protocols, which can be beneficial for limited-capacity devices or high-volume transfer scenarios.

For public file distribution, FTP easily supports anonymous access, making it convenient for sharing non-sensitive files with a wide audience. It also has well-established standards for directory listings, making it predictable across different servers, which can be valuable for certain automation scenarios.

For organizations that need some security features but are committed to FTP for legacy reasons, FTP can be upgraded to FTPS (FTP Secure) by adding TLS/SSL encryption. However, this adds complexity to the implementation and doesn’t address all of the protocol’s inherent limitations.

Use Cases for FTP

FTP may still be appropriate in specific scenarios where security concerns are minimal or can be addressed through other means. For internal transfers in secure networks, where data moves entirely within a secured, private network and the risk of interception is minimal, FTP may offer sufficient functionality with lower overhead.

Legacy system integration often necessitates the use of FTP, as older systems may not support newer, more secure protocols. In these cases, FTP might be the only viable option for automated file transfers, though additional security measures should be considered wherever possible.

Public file distribution of non-sensitive files intended for open access can be effectively handled by FTP. Educational institutions, for example, might use anonymous FTP for distributing public research papers or open-source software.

In scenarios involving high-volume, low-sensitivity transfers where performance is prioritized over security, FTP’s lower overhead may provide advantages. Similarly, in simple deployments for small-scale, non-critical applications where ease of implementation is the primary concern, FTP might be an acceptable choice.

Resource-constrained environments with limited computational resources and minimal security requirements might benefit from FTP’s efficiency. This could include embedded systems or IoT devices with limited processing power.

It’s important to note that even in these scenarios, organizations should carefully consider the security implications and explore whether SFTP or other secure alternatives could meet their needs without compromising security. The use cases for FTP are increasingly limited as security and compliance requirements become more stringent across all industries.

What is SFTP?

SFTP, or SSH File Transfer Protocol, is not actually an extension of FTP, despite the similar name. Rather, it’s a secure file transfer protocol that runs over the SSH (Secure Shell) protocol. Developed in the late 1990s, SFTP was designed from the ground up with security in mind.

Unlike traditional FTP, SFTP uses a single encrypted connection (typically over port 22) for both authentication and data transfer. It provides authentication, encryption, and integrity checking mechanisms to ensure secure file transfers.

SFTP has evolved to become the industry standard for secure file transfers, particularly in environments where data security and regulatory compliance are priorities.

Benefits of SFTP

SFTP offers numerous advantages that make it the preferred choice for modern file transfer requirements. Its built-in security encrypts everything by default, protecting both credentials and data from interception. This comprehensive encryption approach means that sensitive information is protected throughout the entire transfer process, significantly reducing the risk of data breaches.

The simplified connectivity of SFTP, with its single-channel approach, streamlines network configurations and firewall rules. This not only enhances security but also reduces the administrative overhead associated with managing complex network configurations.

SFTP supports strong authentication options, including public key authentication and other SSH authentication methods, providing robust security beyond simple password protection. This multi-layered approach to authentication helps prevent unauthorized access to sensitive data.

Data integrity is another significant advantage of SFTP. The protocol includes mechanisms to verify that files haven’t been tampered with during transfer, ensuring that data arrives exactly as it was sent. This is crucial for maintaining the accuracy and reliability of critical business information.

SFTP uses a consistent UNIX-like permissions model that works reliably across platforms, making it easier to manage access controls in heterogeneous environments. It also efficiently supports the resumption of interrupted file transfers, which is invaluable when dealing with large files or unreliable network connections.

The protocol offers more powerful remote file manipulation capabilities than traditional FTP, allowing for more sophisticated file management operations. Perhaps most importantly, the security features of SFTP make it suitable for compliance with regulations like HIPAA, GDPR, PCI DSS, and others, which increasingly require strong protection for data in transit.

Use Cases for SFTP

SFTP is the appropriate choice in numerous scenarios where security and compliance are priorities. When handling transfers containing sensitive data such as personally identifiable information (PII), financial data, health records, or other confidential information, SFTP provides the necessary encryption to protect this data in transit.

Organizations subject to regulatory compliance requirements like HIPAA, GDPR, PCI DSS, SOX, or GLBA find SFTP essential for meeting their data protection obligations. The protocol’s security features align with the requirements of these regulations, making compliance more straightforward.

Business partner file exchange across organizational boundaries requires secure methods to protect proprietary information. SFTP provides the necessary security for sharing files with vendors, partners, or customers outside your organization without exposing sensitive data to interception.

In today’s remote work environments, SFTP offers secure file access to remote workers accessing corporate resources from various locations and networks. This is particularly important when employees are connecting from public networks or using personal devices.

Cloud integration involves transferring data to and from cloud environments across the public internet, where encryption is essential for protecting information as it moves between on-premises systems and cloud services. SFTP provides this protection natively.

Financial institutions use SFTP for secure transfer of financial records, transaction data, or payment information, where both security and data integrity are critical. Healthcare providers rely on SFTP when sharing patient records or clinical data to ensure HIPAA compliance and patient privacy.

Organizations protecting intellectual property depend on SFTP to secure the transfer of valuable IP, trade secrets, or confidential business information, preventing industrial espionage and maintaining competitive advantages.

In these and many other scenarios, the security benefits of SFTP far outweigh any potential performance advantages of unencrypted FTP, making it the clear choice for modern business needs.

Similarities Between SFTP and FTP

Despite their technical differences, SFTP and FTP share several common features and capabilities. Both protocols enable the transfer of files between client and server systems over a network using a client-server architecture. They support similar command sets for basic file operations such as uploading, downloading, listing directories, and renaming or deleting files.

Both SFTP and FTP allow for navigation through directory structures, creating and removing directories, and managing file permissions, though SFTP has more robust permission management capabilities. They can be used in automated scripts and workflows for scheduled or event-driven file transfers, and both have broad support across operating systems and are implemented in numerous client and server applications.

These common features often lead to confusion about the two protocols, but the similarities largely end at the functional level. The underlying mechanisms and security models differ substantially.

Key Differences Between SFTP and FTP

The differences between SFTP and FTP are significant and primarily center around security, connection handling, and protocol design. At the foundational level, FTP operates directly over TCP/ IP, while SFTP operates as a subsystem of the SSH protocol, leveraging its security features. This fundamental difference drives many of the other distinctions between the protocols.

In terms of security, FTP transmits data in plain text, including credentials and file contents, making it vulnerable to interception and eavesdropping. SFTP, on the other hand, encrypts all traffic, including authentication credentials and file data, providing much stronger protection against data breaches.

The connection models also differ significantly. FTP uses separate control and data channels, often requiring multiple ports and complex firewall configurations. SFTP streamlines this approach by using a single encrypted channel for both commands and data, which simplifies network configurations and enhances security.

Authentication mechanisms represent another key difference. FTP typically relies on simple username/password authentication sent in plain text. SFTP supports multiple authentication methods, including passwords, public key authentication, and multi-factor options, providing more robust security options.

Data protection is perhaps the most critical distinction. FTP provides no built-in protection for data integrity or confidentiality, while SFTP includes mechanisms for data integrity verification and encryption. This makes SFTP inherently more suited to handling sensitive information.

From a firewall and network perspective, FTP often requires complex firewall configurations due to its dynamic port usage, while SFTP operates over a single port, significantly simplifying firewall rules and network management.

Finally, from a development standpoint, FTP is an older protocol with limited ongoing development, while SFTP continues to evolve with security improvements and feature enhancements to address emerging threats and requirements.

These differences highlight why SFTP has become the preferred choice for security-conscious organizations and those operating in regulated industries, like healthcare, financial services, and government/defense.

Criteria to Consider When Shopping for a FTP or SFTP Solution

When evaluating FTP or SFTP solutions, organizations should consider several key factors to ensure they select a solution that meets their specific needs. Security features should be at the forefront of this evaluation, including the types and strengths of encryption supported, authentication methods available, session management capabilities, and file integrity verification mechanisms.

Compliance capabilities are increasingly important in today’s regulatory environment. Look for solutions that provide detailed audit logging with appropriate retention policies, comprehensive user activity tracking, granular file access controls, and relevant compliance certifications such as SOC 2 or HIPAA compliance.

Scalability is essential for growing organizations. Consider the maximum concurrent connections the solution can handle, its throughput capabilities for large file transfers, clustering and high-availability options to ensure business continuity, and geographic distribution capabilities for organizations with multiple locations.

Usability affects both user adoption and administrative overhead. Evaluate the availability and quality of web interfaces, mobile access options, the overall end-user experience, and the comprehensiveness of administrator dashboards and controls.

Integration capabilities determine how well the solution will work with your existing systems. Look for robust API availability, support for webhooks and event triggers, integration with identity providers for unified authentication, and compatibility with workflow systems and other business applications.

Automation features can significantly enhance efficiency. Assess the scheduling capabilities for recurring transfers, support for event-driven transfers based on system activities, workflow automation options, and error handling and recovery mechanisms.

Effective monitoring and reporting are critical for maintaining visibility into file transfer activities. Evaluate the real-time monitoring tools provided, alerting mechanisms for transfer failures or security incidents, comprehensive reporting capabilities, and visibility into transfer status and history.

Support and maintenance can make or break a solution’s long-term success. Consider the quality and availability of vendor support, the frequency and process for updates, the availability of community resources, and the quality of documentation.

Finally, evaluate the total cost of ownership beyond just the initial purchase price. Consider the license model (perpetual vs. subscription), implementation costs including any necessary infrastructure changes, ongoing maintenance requirements, and training needs for administrators and end users.

A thoughtful evaluation across these criteria will help ensure that the selected solution aligns with both current needs and future growth plans.

Security and Compliance Considerations

The security differences between FTP and SFTP have significant implications for regulatory compliance in today’s data-protection landscape. Understanding these differences is essential for making informed decisions about file transfer protocols.

FTP suffers from several fundamental security limitations that make it problematic for handling sensitive data. Credentials are exposed during authentication since usernames and passwords are transmitted in plain text, making them vulnerable to interception by attackers monitoring network traffic. Similarly, all transferred file data is unencrypted and visible to anyone who can capture the network traffic, creating serious risks for confidential information.

The protocol lacks built-in integrity checking mechanisms, providing no way to verify that files haven’t been altered during transfer either accidentally or maliciously. The unencrypted command channels can potentially be exploited for command injection attacks, creating additional security vulnerabilities. Furthermore, standard FTP offers limited authentication options, typically relying solely on username/password combinations, which don’t provide the multi-factor security increasingly required by modern security standards.

In contrast, SFTP offers comprehensive security advantages that address these limitations. SFTP encrypts all session data, including credentials and file contents, preventing eavesdropping and data exposure. It incorporates integrity checking to ensure files aren’t tampered with during transit, maintaining data accuracy and reliability.

The protocol supports strong authentication methods, including public key authentication and other SSH authentication options, providing greater security beyond simple passwords. Its single-channel approach eliminates security issues related to the FTP data channel negotiation, simplifying security management. SFTP also provides better logging and tracking capabilities, enhancing auditability for compliance purposes.

These security differences have direct implications for regulatory compliance. Regulations such as GDPR, HIPAA, PCI DSS, and SOX typically require robust protection for sensitive data in transit, strong access controls and authentication mechanisms, comprehensive audit trails for security monitoring and compliance verification, and risk-appropriate security measures based on data sensitivity.

SFTP satisfies these requirements inherently, while FTP would require significant additional security layers (like implementing FTPS) to approach comparable compliance readiness. Even then, some of FTP’s architectural limitations would remain problematic from a compliance perspective.

Organizations handling regulated data should carefully consider these compliance implications when selecting a file transfer protocol, as the choice can significantly impact their ability to demonstrate regulatory compliance and protect sensitive information.

Top SFTP and FTP Solution Providers

SFTP Solutions:

Kiteworks SFTP offers comprehensive security, compliance, and governance capabilities. It excels in regulated industries like healthcare, finance, government, and legal services where data protection requirements are stringent. Kiteworks offers robust audit trails, strong integration options, and a modern approach to SFTP that balances security with usability. Similarly, Kiteworks secure managed file transfer enables efficient and secure information exchanges by streamlining and protecting large-scale file transfer operations.

GoAnywhere provides a comprehensive managed file transfer (MFT) suite with extensive workflow automation capabilities. Its strength lies in supporting multiple protocols alongside powerful automation features and detailed audit logging. Organizations needing to automate complex file transfer workflows alongside secure transfers often find GoAnywhere’s approach particularly valuable.

SolarWinds Serv-U offers ease of use and good value, particularly for organizations already using other SolarWinds products. Its web-based transfer capabilities and integration with the broader SolarWinds ecosystem make it an attractive option for those seeking cost-effective solutions without sacrificing essential functionality.

WS_FTP Professional focuses on strong client-side functionality and automation features. With a long history of reliability in the market, it serves individual users and small teams needing robust client-side transfer capabilities especially well, balancing ease of use with security.

OpenSSH SFTP provides an open-source solution that’s widely deployed and highly customizable. Organizations with significant technical expertise seeking a no-cost solution often choose OpenSSH SFTP, leveraging its flexibility and strong community support to build custom implementations.

FTP/Multi-Protocol Solutions:

FileZilla Server offers a free open-source solution with simple setup and support for both FTP and FTPS. Small organizations or projects with limited budgets often select FileZilla for its accessibility and basic security options when implementing FTPS.

GlobalSCAPE EFT provides a comprehensive feature set with support for multiple protocols including FTP, FTPS, and SFTP. Its advanced automation capabilities and compliance features make it suitable for enterprises requiring multiple transfer protocols alongside sophisticated workflow automation.

Cerberus FTP Server balances ease of use with good security options and web client functionality at a reasonable cost. Small to mid-sized businesses seeking an accessible yet secure solution often find Cerberus meets their needs without overwhelming complexity.

Titan FTP Server offers robust security features with good performance and scalability options. Its strengths make it well-suited for mid-sized businesses with specific FTP requirements that need room to grow without changing platforms.

CrushFTP provides multi-protocol support with considerable flexibility and cross-platform compatibility. Organizations needing diverse protocol support across various platforms appreciate its adaptability to heterogeneous environments.

Each of these solutions offers distinct advantages, and the best choice depends on specific organizational requirements, technical expertise, budget constraints, and long-term file transfer strategy.

Why SFTP is Superior to FTP

While FTP has served businesses for decades, SFTP represents the evolution of file transfer technology to meet contemporary security challenges and compliance requirements. The case for SFTP as the modern choice rests on several compelling advantages.

SFTP was architecturally designed with security as a foundational principle, not as an afterthought. In an era of increasing cyber threats and data breaches, this security-first approach is essential for protecting sensitive information. The encrypted nature of SFTP means that data is protected from interception during every transfer, automatically safeguarding both the content and the authentication process.

Regulatory compliance has become increasingly complex and stringent, touching more organizations across various industries. SFTP’s built-in security features align naturally with compliance requirements, reducing the additional controls needed to satisfy auditors and regulators. For organizations in regulated industries, SFTP significantly simplifies the compliance burden compared to FTP by providing encryption, strong authentication, and auditing capabilities out of the box.

Although FTP might appear simpler at first glance, the total cost of securing an FTP implementation to meet modern security standards often exceeds the cost of implementing SFTP from the start. The additional expenses for securing FTP include security add-ons and complementary solutions to address its inherent limitations, compliance remediations to meet regulatory requirements, risk management costs to mitigate vulnerabilities, and potential breach recovery expenses if security measures fail.

As security standards continue to evolve in response to emerging threats, SFTP is positioned to adapt and remain compliant. FTP, being fundamentally insecure in its standard form, will require increasingly complex modifications to meet future security requirements, creating ongoing maintenance challenges and potential security gaps.

Using SFTP significantly reduces organizational risk compared to FTP. Data breaches can result in devastating consequences including financial losses from remediation costs and penalties, regulatory penalties for non-compliance, reputational damage affecting customer trust and business relationships, and legal liabilities from affected parties. The enhanced security of SFTP helps mitigate these risks, providing both peace of mind and tangible business benefits.

The case for SFTP as the modern choice is compelling for any organization that values data security, operational efficiency, and regulatory compliance. As digital transformation continues to reshape business operations and increase data sharing requirements, SFTP provides the secure foundation necessary for responsible file transfer management.

Kiteworks Revolutionizes SFTP

While both FTP and SFTP serve the fundamental purpose of transferring files between systems, SFTP clearly emerges as the superior choice for modern business environments. Its built-in security features, compliance advantages, and operational benefits make it the responsible choice for organizations that value data security and regulatory compliance.

For organizations seeking a comprehensive SFTP solution that addresses both security and compliance needs, Kiteworks SFTP stands out. Kiteworks revolutionizes SFTP with a modern, easy-to-administer solution that frees up time and budget while providing rock-solid reliability, security, and governance. It enables businesses to configure their security policies while empowering users to efficiently onboard partners, manage their content, and set their permissions. Full visibility into every transfer, supported by comprehensive audit logs, lets organizations defend against breaches and compliance violations.

As organizations continue to digitize operations and share increasingly sensitive data with partners, customers, and remote workers, the importance of secure file transfer cannot be overstated. By implementing a solution like Kiteworks SFTP, businesses can confidently meet current security challenges while preparing for future requirements.

The Kiteworks Private Content Network, a FIPS 140-2 Level validated secure file sharing and file transfer platform, consolidates email, file sharing, web forms, SFTP and managed file transfer, so organizations control, protect, and track every file as it enters and exits the organization.

To learn more about the Kiteworks Private Content Network and how our modern SFTP solution can save you valuable time and budget while providing rock-solid reliability, security, and governance, schedule a custom demo today. 

Additional Resources

• Blog Post SFTP Vulnerabilities and Strategies to Secure Your File Transfers
• Blog Post  SFTP Security – Is It Truly Secure?
  
• Blog Post  What to Look for in a Top SFTP Server: Critical Features
  
• Video Kiteworks Snackable Bytes: SFTP Server
• Blog Post  How to Improve SFTP Adoption: Top Benefits and Strategies