When you make a booking via Hostelworld, you get to choose between 2 different rates.
1) The Standard rate (Free Cancellation, please see Conditions), which amongst other benefits, can be paid upon arrival.
2) The Non-refundable rate, that requires to be fully paid in advance, and is usually slightly cheaper.
During the booking process, the rate selection looks like this:
And if you hover over the icon, you can see additional information:
The conditions of the Non-refundable booking are also communicated in great detail in the Terms and Conditions of your Agent, and in the Hostelworld confirmation email:
The confirmation email you receive from Flying Pig hostels repeats the T&Cs of the non-refundable booking too: