EFT Pre-Authorized Debit - BETA

EFT Pre-Authorized Debit (PAD) is a payment method used in Canada supported by the local banking rail. It’s commonly used for recurring transactions with low costs compared to credit cards.

* Support for increasing the maximum transaction amount is available on a case by case basis upon risk approval.

Airwallex has built a range of client-side integration methods that allow you to manage your UI, minimize your implementation effort, and allow you to get to market quickly.

EFT PAD provides delayed notifications, which means transactions cannot be confirmed immediately.

When you initiate a payment with an active authorization, a 4-business-day period is required to confirm the payment's status. If a payment is successful, we will confirm and settle within the same day at T+4.

• Please note that payments should be initiated before 2:30 pm MST/MDT. Payments initiated at or after 2:30 pm MST/MDT will be processed the next business day.

After payment is successful, there's still a possibility of bank rejection or dispute by payers. Both are considered disputes.

• Bank rejection: this typically occurs within the first four days. However, in rare instances, a successful debit payment can be reversed, subject to the decision of the banks involved.
• Dispute by business payers: businesses have up to 10 business days to reject the payment without providing a reason.
• Dispute by consumer payers: consumers have up to 90 calendar days to reject the payment without providing a reason.

The following diagram describes the timing of EFT PAD payment.

According to Canada Pre-Authorized Debit rules, you must conduct account verification for the first use of an external bank account number, or changes to the account number.

By default, Airwallex offers Plaid to help you verify that the payer, i.e. your customer, has the authority over the bank account to set up direct debit. In some cases, we also offer verification via micro-deposit, or micro-deposit + micro-debit.

Plaid

Plaid is an open-banking platform that will verify the bank account by requiring the payer to log in to their ebanking.

Micro-deposit

For micro-deposit verifications, Airwallex will trigger two deposits to the specified bank account with small amounts. The payer then needs to enter those two amounts in an AWX hosted interface to verify that they have access to the account.

Micro-deposit + micro-debit

Micro-deposit + micro-debit adds a micro-debit on top of the micro-deposit process. In parallel to triggering the two micro-deposits, Airwallex will also trigger a debit with a small amount. Airwallex will then wait to see whether this debit has been successful (i.e. not rejected by the bank), before allowing larger debits to be processed.

During the initial checkout process, the payer must authorize Airwallex to directly debit the account on behalf of your business, in compliance with the Canada Pre-Authorized Debit rules.

A copy of the authorization email will be sent by Airwallex to your customers automatically, and is stored and made available to be shared with your customers at all times.

Content of the authorization mandate:

• Date of the agreement
• Payer bank account name
• Payer bank account number

For EFT PAD, the dispute process gives significant consumer rights to the shopper.

Disputes within the rejection window:

Business payers have up to and including 10 business days after the debit to reject. Personal payers have 90 calendar days after the debit to reject. You will not be able to challenge the rejection and the funds will be returned to the shopper.

The settlement of the direct debit will be canceled or reversed by deducting the disputed amount from your next settlement batch. We recommend you to contact your customer to resolve the situation.

Disputes after the rejection windows:

Disputes raised after these deadlines will be managed by you and your customers outside the rule of Payments Canada. There is no deadline for raising disputes, i.e. your customers can dispute anytime after rejection deadlines.

For such disputes, Airwallex will reach out to you via email. Please note, that you are liable for any dispute outcome and associated fees.

Please note the risk of double crediting with refunds and disputes. If you proactively issue your shopper a refund while their bank also initiates the dispute process, they may receive two credits for the same transaction.