What kind of businesses are best suited to use pre-authorized debits?

June 25, 2019
June 25, 2019

Pre-Authorized Debits work best for businesses that collect ongoing payments from the same customer. Whether you collect recurring payments on a set schedule or variable amounts from time to time, PADs are a great fit.

A few examples of businesses with recurring payments on a set schedule include: fitness centres — for membership fees, daycares— for monthly dues and Property managers — for rent payments.

There are some cases, however, where the amount of the transaction fluctuates and the timing is not always consistent. Accountants or digital marketing companies are a great example of businesses that use PADs to process variable amounts based on the number of hours they’ve worked.

Unlike Interac or credit cards, pre-authorized debits do not clear instantly and they are required to be scheduled at least 1 business day in advance. This means that Pre-Authorized Debits are not a great choice for businesses that don’t have an established relationship with their customers such as retail or e-commerce.

What are Pre-Authorized Debits (PADs)?

What are the advantages of Pre-Authorized Debits?

What kind of businesses are best suited to use authorized debits?

How do pre-authorized debits work?

Are pre-authorized debits secure?

How do I start accepting pre-authorized debits?

What is an authorization and why do I need it for pre-authorized debits?

How long do pre-authorized debits take?

What to know about pre-authorized debit rejections.