Pre-Authorized Debits work over a computerized network through Payment Canada’s federally-secured Automated Clearing Settlement System. This network connects all of Canada’s financial institutions.

When you have an account set up with a processor, the first step is to collect a Pre-Authorized Debit agreement from your customer. This will outline the payment terms and give you the proper authorization to initiate payments.

Next, you can set a transaction schedule based on the agreed upon payment terms. Payment instructions are sent to the bank one day in advance of the process date. The details are then exchanged within the Automated Clearing Settlement System and the appropriate funds are withdrawn from your customers bank account, and deposited to yours.

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.