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Remittance advice is a letter sent by a customer to a supplier to inform the supplier that their invoice has been paid. If the customer is paying by cheque, the remittance advice often accompanies the cheque. The advice may consist of a literal letter (e.g., "To Whom it May Concern: Your shipment of the 10th inst was received in good order; accompanying is our remittance of $52.47 per invoice No 83046") or of a voucher attached to the side or top of the cheque. Remittance advices are not mandatory, however they are seen as a courtesy because they help the accounts-receivable department to match invoices with payments. The remittance advice should therefore specify the invoice numbers for which payment is tendered. In countries where cheques are still used, most companies' invoices are designed so that customers return a portion of the invoice, called a remittance advice, with their payment. In countries where wire transfer is the predominant payment method, invoices are commonly accompanied by standardised bank transfer order forms (like acceptgiros (in Dutch) (Netherlands) and Überweisungen (in German) (Germany)) which include a field into which the invoice or client number can be encoded, usually in a computer-readable way. The payer fills in his account details and hands the form to a clerk at, or mails it to, his bank, which will then transfer the money. The employee who opens the incoming mail should initially compare the amount of cash received with the amount shown on the remittance advice. If the customer does not return a remittance advice, an employee prepares one. Like the cash register tape, the remittance advice serves as a record of cash initially received. Modern systems will often scan a paper remittance advice into a computer system where data entry will be performed. Modern remittance advices can include dozens, or hundreds of invoice numbers, and other information. Remittance advices can be very complicated, especially in specialized fields like medical insurance payments. See also[edit]
References[edit]For suppliers and customers alike, it’s always beneficial to have a little more clarity around the invoicing process. As a customer, issuing remittance advice slips can help ensure that your suppliers are always able to match an invoice to a payment. As a supplier, requesting remittance advice can help you optimise your accounts receivable processes. But what is remittance advice? Find out everything you need to know with our comprehensive guide. What does "remittance" mean ?Deriving from the term ‘remit’ (meaning “to send back”), remittance refers to a sum of money that is sent back or transferred to another party. It covers virtually any payment, from bills to invoices, and is typically used with overseas payments – when one party is based in another country. In addition, remittance can also cover personal money transfers made to friends and family. What does remittance advice mean ?In short, remittance advice is a proof of payment document sent by a customer to a business. Generally, it’s used when a customer wants to let a business know when an invoice has been paid. In a sense, remittance slips are equivalent to cash register receipts. They’re particularly helpful when it comes to matching up invoices with payments. Because online payments are becoming increasingly popular, remittance advice slips are sometimes unnecessary. However, after an invoice has been paid, sending a confirmation email is always appreciated. What should a remittance advice slip include ?Several key pieces of information need to be included on your remittance advice slip. Most importantly, the slip should identify:
The remittance advice slip should be issued on company headed paper and contain contact details for a member of your organisation who can deal with any queries the supplier may have. Do I need to send remittance advice?No, remittance advice slips are not obligatory. However, they are a courtesy that suppliers are likely to appreciate, as they can be very helpful for recordkeeping and identifying which payments are associated with which accounts. Furthermore, remittance slips don’t require much effort to produce, as many businesses will issue a remittance advice note alongside the invoice, making it easier for customers to send across the required information in the correct format. What are the different types of remittance advice?It’s important to note that remittance advice comes in several different forms:
What’s the best way to send remittance advice?If you want to issue a remittance advice slip to your supplier, there are a couple of different options: email and snail mail. It’s worth remembering that snail mail is likely to be slower, so for the sake of efficiency, email is probably the best choice. When you send your remittance slip over email, ensure that it’s going to the appropriate email address (unless you’ve been told otherwise, this is likely to be accounts receivable). If you send it to a general company inbox, it can get lost in the shuffle. We can helpGoCardless helps you automate payment collection, cutting down on the amount of admin your team needs to deal with when chasing invoices. Find out how GoCardless can help you with ad hoc payments or recurring payments. Over 70,000 businesses use GoCardless to get paid on time. Learn more about how you can improve payment processing at your business today.Why did I get a remittance advice?Remittance advice is used by a customer to inform the supplier about a payment status. It contains important information such as the payment amount and what invoice numbers the payment is tendered. If an invoice is paid by check, it's common to attach a paper remittance advice to the check.
Does remittance mean payment?A remittance refers to a money transfer that is sent as a payment or gift to another party. You may send a payment remittance to meet a bill or invoice obligation. Transfers sent abroad from foreign workers to their family in a native country are also known as remittances.
Who is the remittance advice sent to?Remittance advice is a letter sent by a customer to a supplier to inform the supplier that their invoice has been paid. If the customer is paying by cheque, the remittance advice often accompanies the cheque.
Why did I get a check from Bill com?Automated check processing
We use the same mail service as other common national billers-such as other telecom, utility, and financial institutions-to print and stuff our monthly bills. This third-party vendor receives a check file from Bill.com on a daily basis.
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