Pre-authorized debits (PADs)

Before you can offer a PAD option to your customers, you must sign the AccèsD Affaires enrollment agreement (referred to as Payee Letter of Undertaking in Rule H1 – Pre-Authorized Debits (PADs) (PDF, 796 KB) External link. ) with the Desjardins caisse or branch that will process the PADs on your behalf.

Before initiating a PAD, you must get permission from the account holder (the payor) using a form or process that we've approved. This permission is called a Payor's PAD Agreement in Rule H1.

You need to make sure that your payor's PAD agreement meets the mandatory requirements set out in Appendix II of Rule H1 – Pre-Authorized Debits (PADs) (PDF, 796 KB) External link.

• Agreement date and signature
  
• A statement giving the business or organization the authority to debit a specific account
  
• PAD amount, timing and initiating act or event
  
• PAD type (personal or business)
  
• A statement indicating that the payor can cancel the PAD agreement
  
• A statement advising payors that they can get a sample cancellation form or other information on their right to cancel a PAD agreement from their financial institution or the Payments Canada website
  
• Contact information of the payee that the payor can use to make inquiries, obtain information and seek recourse in the event of an error or unauthorized PAD
  
• A standard statement about the recourses available to the payor

Other requirements may apply for PADs.

See a sample payor's PAD agreement (PDF, 1.12 MB) This link will open in a new window.
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You can set up a payor's PAD agreement in person, online or by phone. We need to review and approve the PAD agreement forms and your proposed procedures for verifying a payor's identity and authorization before they can be implemented.

The cancellation of a payor's PAD agreement does not change any existing obligations between a payor and a business under a broader contract for goods or services. For example, if a payor has signed a 1-year lease and initially agrees to make monthly payments by PAD, the payor can cancel the PAD agreement at any time, but must make arrangements with the business to use another form of payment.

For more information, visit the Payments Canada website External link.

The payor must receive a written notice about any change 10 calendar days before the next PAD.

However, if your payor's PAD agreement says that the amount can be changed through a direct action by the payor (such as instructions by phone), you don't need to send a notice.

Rule H1 states that the cancellation period that you can include in the payor's PAD agreement cannot exceed 30 calendar days. In practice, you must specify the cancellation period in business days (for example, 5 business days), as long as the period is less than 30 calendar days. For more information, see section 17 in Appendix I of  Rule H1 – Pre-Authorized Debits (PADs) (PDF, 796 KB)