Remittance advice – What is remittance advice?

Remittance advice is a document sent by a customer to a seller, informing the seller that an invoice has been paid.

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Remittance advice is not mandatory, but it is often seen as a courtesy. Remittance advice is sent much more frequently in some industries than in others and is becoming less common in general.

What to include in remittance advice

The main purpose of remittance advice is to help suppliers match invoices with payments.

Remittance advice should therefore include the invoice number, along with the payment amount and method of payment.

How to send remittance advice

Because it is not mandatory, there are no legal guidelines for sending remittance advice. Remittance advice can therefore be sent in a number of ways.

Remittance advice could come in the form of a note or letter, whereas some businesses create invoices with a removable portion that can be returned by the customer along with the payment.

If payment is made via cheque, remittance advice is commonly sent with the cheque.

Alternatives to remittance advice

Online payment is becoming increasingly popular, therefore reducing the need and popularity of remittance advice.

If you make a payment online, you can still help a supplier match your payment with the correct invoicing by sending an email to inform them of your payment or create a reference along with your payment referring to the invoice number.