PAD Payment Timings

PAD payment timings in a nutshell

If you are creating a PAD payment for a customer with an active authorisation, it will take 3 business days before the customer is charged.

Once the customer has been charged, it will take a further 3 - 4 business days before the funds are paid out to you and received.

Please note that these timings are based on the payments being collected as soon as possible. If a payment is created in advance, for example, with a specific charge date, then the payment would be submitted automatically, one working day before the charge date. 

Pre-Authorized Debit timings

Please note timings below are industry standard for Canadian Pre-Authorized Debits. To view PAD payment timings with GoCardless, please visit our support centre.

It's also important to note that Pre-Authorized Debit is not an instant payment method. Payments will always take at least one working day from the collection date to arrive in your bank account.

PAD Advance Notice

You must notify your customer before submitting a Pre-Authorized Debit payment. By default, the notice period is 10 calendar days, which can be reduced if agreed with your customer.

Exceptions can be made for fixed payment schedules where a customer has already been notified. For example, you've previously told them that $100 would be collected on the 1st of every month). Changing this amount or date requires 10 days’ advance notice, unless the customer has directly asked for the change.

For electronic agreements, you must give confirmation at least 15 calendar days before taking the first payment. This can be reduced to a minimum of 3 calendar days, provided you’ve got appropriate identity verification procedures in place and have informed the customer.

PAD ACSS payment submission deadlines

Submission deadlines will differ according to your sponsor bank. In general, you’ll need to submit your files the day before or the morning when the payment is due. Your bank may only submit payment requests on the payment due date (or the next business day if the due date falls on a weekend or holiday).

Successful payments will show on your bank statement within 1 day of the collection date. It’s important to remember that there are no notifications for unsuccessful payments, only for returned ones.

What’s more, return notifications may not be received until day 1 or 2 after the attempted collection date. Due to these rules, it can take up to 3 days for you to confirm that a Pre-Authorized Debit payment has been successfully processed.

PAD Timeline: the Pre-Authorized Debit collection process

• 10 calendar days before collection - This is the last day you can send a notification of payment to your customer. (Timing can be reduced in agreement with the customer.) The advanced notification period for Pre-Authorized Debit through GoCardless is only 3 calendar days as standard.

• 1 business day before collection / Day of collection (morning) - This is the day you can send a payment instruction to your bank.

• Day of collection - Day on which the payer's bank attempts to debit the customer’s account.

• 1-3 business days after collection - You will be notified via ACSS if the transaction has failed.

• 30 days after collection - This is the last day you can retry a payment if it failed due to non-sufficient funds. A payment can only be retried once.

PAD Non-working days

No submissions can be made on non-working days, as the banks won’t process any Pre-Authorized Debit payments on these days.

PAD Payment timings using GoCardless

Using GoCardless to manage your Pre-Authorized Debits takes away the complexity of the processes we’ve explained in the sections above.

We process Canadian payments according to Eastern Standard Time (EST) on Canadian business days only (any day other than a Saturday, Sunday or federal statutory holiday).

With GoCardless, there’s a three-day confirmation period after the customer completes the electronic mandate, after which the payment can be submitted. The payment will then be credited to your account three working days after it is submitted.

Learn more here.

Case Study: Released

Re-Leased, a cloud-based commercial real estate management platform collecting from customers in the UK, Australia, New Zealand, the USA and Canada, encountered challenges related to inefficient international payments and high Days Sales Outstanding (DSO). Recognising these problems, Sam Caulton, the company's CFO, sought a reliable solution and found it in GoCardless, an automated payment service provider.

The decision to shift to GoCardless resulted in significant benefits for Re-Leased. The integration was straightforward due to its compatibility with Xero's online accounting platform, which Re-Leased already used. Sam observed, 

With GoCardless, the company streamlined its payment process, which was previously slow and costly. This transition led to savings of $10,000 per month on bank transfer fees. Moreover, GoCardless reduced Re-Leased's DSO to 30 days, improving the cash flow and allowing the finance team to focus on other tasks. Sam explains, 

Looking to the future, the company aims to encourage more customers to use Direct Debit as it reduces financial risk and allows more time for customer focus and business growth. In Sam's words, 

Sam recommends GoCardless without hesitation, noting its fantastic user experience and value to any business aiming to speed up payment processes or reduce arrears.

The shift to bank payments via GoCardless has proven beneficial for Re-Leased, with marked improvements in customer service, financial reporting, and operational efficiency. 

We can help

Setting up payment collection is effortless and efficient with GoCardless. By automating your payment process, GoCardless drastically cuts down the administrative responsibilities for your team. 

GoCardless makes it quick and easy to get started, and with no contracts or long-term commitment required, there’s no risk. You can set up instant, one-off, or recurring payments in the merchant dashboard in just a few clicks, and GoCardless automatically creates and sends all the necessary forms, doing all the heavy lifting for you. You can also connect to GoCardless via over  350 partner apps, such as Xero and Quickbooks.

Discover how GoCardless can optimise your payment process making it easier for you to concentrate on what matters most - your business growth.”