If you run a subscription or recurring-billing business, it is worth considering account-based auto-debit (PAD) in Canada alongside cards. PAD debits a consumer's bank account under rules set by Payments Canada, based on the consumer's prior debit consent (a PAD Agreement), and it is widely used for recurring payments such as telecom, insurance, and subscription services. Because there is no payment failure from card expiry or reissue, it is advantageous for managing recurring-payment retention.

It is best suited to online businesses that bill a fixed amount every month, such as SaaS, memberships, and content subscriptions. However, unlike card authorization, the debit is not confirmed instantly and can be reversed afterward due to insufficient funds or a consumer refund claim, so it fits recurring billing models better than large single-item sales.

When a consumer enters their account information online and signs a PAD agreement, funds are debited from their account according to the terms of that agreement. Unlike card authorization, the debit is not confirmed instantly and can be reversed later due to insufficient funds, and funds successfully collected are received by Hecto Financial in CAD, converted, and settled in the contracted currency among USD, KRW, and JPY.

By integrating through Hecto Financial, a Korean corporation can consider adopting Pre-Authorized Debit Canada payments without a separate local contract in Canada. Because PAD has different operational requirements from card-based methods — such as obtaining prior debit consent and handling refund claims — please review consent collection methods and refund-handling procedures together with the Hecto Financial sales team before signing a contract.

• Business registration country

  Confirm contract eligibility for businesses registered in Korea

• Sales channels

  Integration method and priority differ depending on your online sales channel mix — own site, marketplace, mobile app, etc.

• Product categories

  You need to check in advance whether your product category falls under Pre-Authorized Debit Canada's restricted-industry merchant policy

• Local regulatory compliance

  Confirm compliance with Canada's payment and foreign exchange regulations (see official sources below)

The most important thing in PAD settlement is the 'point of finality.' Debited funds are received by Hecto Financial in CAD, converted, and settled in the contracted currency among USD, KRW, and JPY, but under Payments Canada's PAD rules, consumers can claim a refund through their bank within 90 days for a debit made without consent or that differs from the agreement. This creates a collection risk where funds can be returned even after settlement has been completed, so it is essential to keep thorough records of debit consent and to clearly disclose the amount and frequency of charges in advance.

• Bank of Canada, Payments CanadaOfficial information on Canada's payment systems and clearing rules. If the content on this page differs from actual regulations, the official source takes precedence.