SFTP

What is SFTP?

SFTP (Secure File Transfer Protocol) is an encrypted network protocol used to transfer files securely between systems over a secure SSH connection. In payroll, it is used for automated exchange of sensitive data—such as bank files, salary registers, or statutory reports—between HR, finance, and external systems.

Key Features:

• Security: Uses encryption to protect confidential payroll data.
• Automation: Enables scheduled transfers between payroll and ERP/bank servers.
• Authentication: Uses secure SSH keys or credentials for access.
• Usage in Payroll: Sharing bank advices, JV files, or compliance reports.
• Compliance: Ensures data privacy as per IT and GDPR norms.

Example

ABC Ltd. uses SFTP to automatically transfer payroll output files from its HRMS to the bank’s secure server every month for salary disbursement.

Why SFTP Matters:

It ensures data confidentiality, integrity, and automation, forming the backbone of secure digital payroll communication.