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Modulr glossary

Pull Payments

A pull payment is a transaction where the payee initiates the transfer of funds from the payer’s account with prior authorisation. Common examples include Direct Debits, card payments, and subscription billing. Unlike push payments, which require the payer to take action, pull payments enable automated, recurring, and scheduled transactions. Modulr provides businesses with efficient pull payment solutions, ensuring seamless collections while maintaining compliance with payment scheme regulations.

Applications

E-commerce:

Reduces fraud in online card payments by verifying the cardholder's identity

Banking and fintech:

Helps issuers and payment providers comply with Strong Customer Authentication (SCA) requirements.

Advantages

  • Enhanced security: Reduces unauthorised transactions by verifying that the genuine account holder is authorising the payment
  • Fraud prevention: Helps reduce chargebacks related to fraud.

Challenges

  • User Experience: Additional authentication steps can cause friction and increase checkout abandonment
  • Implementation complexity: Requires integration with card schemes and issuer systems.

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