Which scenario is a push payment?

Which scenario is a push payment?

• A. The customer instructs their bank to send money to the merchant
• B. The merchant instructs their bank to pull funds from the customer
• C. The card network processes a transfer
• D. The issuer extends credit

Answer: (A)

This question is about who initiates the transfer of funds. A push payment is when the payer actively starts the payment from their own bank to the recipient. The scenario where the customer asks their bank to send money to the merchant fits this perfectly—the payer is initiating the transfer to the recipient. In contrast, a pull payment is the recipient initiating the transfer from the payer’s account, such as a merchant instructing the payer’s bank to withdraw funds. The card network processing a transfer is just the infrastructure, not specifically who initiates the movement of funds. Extending credit is about financing, not initiating a payment, so it doesn’t describe a push or pull payment.

This question is about who initiates the transfer of funds. A push payment is when the payer actively starts the payment from their own bank to the recipient. The scenario where the customer asks their bank to send money to the merchant fits this perfectly—the payer is initiating the transfer to the recipient.

In contrast, a pull payment is the recipient initiating the transfer from the payer’s account, such as a merchant instructing the payer’s bank to withdraw funds. The card network processing a transfer is just the infrastructure, not specifically who initiates the movement of funds. Extending credit is about financing, not initiating a payment, so it doesn’t describe a push or pull payment.