Remittance advice matching is the step in accounts receivable in which a business links a payment it has received to the specific invoices the payer intended to settle. The remittance advice is the payer's statement of what a payment covers: invoice numbers, amounts, and any deductions for discounts, credit notes or disputes. It may arrive inside the payment message, as a separate email or file, or through a customer portal.
Matching is the core of cash application. Staff or software compare the amount and references on the bank statement with open invoices, then clear the items that agree. Payments that cannot be matched are held as unapplied cash until the customer is contacted. Common causes of failure are missing references, one payment covering many invoices, and short payments linked to a disputed invoice. Structured remittance data in ISO 20022 payment messages is intended to raise automatic match rates.