Overview
The REMADV (Remittance Advice) message is sent by the buyer (payer) to the supplier (payee) to provide details about a payment that has been made or is about to be made. It itemises which invoices and credit notes are being settled, the amounts applied to each, any deductions taken, and the total payment amount. The REMADV bridges the gap between the financial payment (bank transfer) and the commercial documents (invoices), enabling the supplier to reconcile their accounts receivable automatically.
Without electronic remittance advice, suppliers receive bank payments with minimal reference information — often just a total amount and a vague payment reference. Matching this payment to individual invoices requires manual effort, especially when a single payment covers dozens or hundreds of invoices. The REMADV eliminates this problem by providing a structured, machine-readable breakdown of every invoice and adjustment included in the payment.
The REMADV is particularly valuable in industries with high transaction volumes, complex pricing arrangements, and frequent deductions. In retail, for example, buyers routinely deduct promotional allowances, early payment discounts, and shortage claims from their payments. The REMADV explains each deduction, enabling the supplier to update their records accurately and dispute any unauthorized deductions promptly.
Message Structure
The REMADV header identifies the payment being described, including the total amount, payment date, and payment method. The detail section lists each document being settled — invoices, credit notes, debit notes — with the amount applied, any adjustments, and reference numbers. The summary reconciles the total.
Key Segments
| Segment | Name | Purpose |
|---|---|---|
BGM | Beginning of Message | Remittance advice number and document function |
DTM | Date/Time/Period | Payment date, remittance advice date, payment value date |
RFF | Reference | Payment reference, bank transaction reference |
NAD | Name and Address | Payer (buyer), payee (supplier), payer's bank, payee's bank |
FII | Financial Institution | Bank account details for payer and payee (IBAN, SWIFT/BIC) |
CUX | Currencies | Payment currency |
DOC | Document/Message Details | Identifies each invoice or credit note being settled (document type and number) |
MOA | Monetary Amount | Amount paid per document, original document amount, deduction amounts, total payment |
AJT | Adjustment Details | Reason codes for payment adjustments (discount, shortage claim, damaged goods) |
PAI | Payment Instructions | Payment method (wire transfer, cheque, direct debit) |
Payment Reconciliation
The core value of REMADV is enabling automated payment reconciliation. Each DOC segment group within the message identifies one commercial document (invoice or credit note) and the amount being applied to it. The supplier's accounts receivable system can automatically match these against open items and close them.
When the paid amount differs from the invoice amount, the AJT (Adjustment Details) segment provides a coded reason. Common adjustment reasons include:
- Early payment discount: The buyer takes an agreed cash discount for paying within the discount period.
- Promotional allowance: A deduction for agreed promotional support or marketing contributions.
- Shortage claim: The buyer deducts for items ordered but not received, usually backed by RECADV data.
- Damage claim: Deduction for goods received in damaged condition.
- Price difference: The buyer pays at their expected price when it differs from the invoiced price, pending resolution.
- Returns deduction: The buyer deducts for goods returned to the supplier.
Common Use Cases
- Retail payment runs: Large retailers process weekly or fortnightly payment runs covering hundreds of invoices per supplier. The REMADV details each invoice and deduction, enabling fully automated reconciliation.
- Manufacturing supply chain: Automotive OEMs send REMADV to tier-1 suppliers, consolidating payments across multiple plants and invoicing entities.
- Self-billing reconciliation: In self-billing (ERS) arrangements, the REMADV confirms the payment amounts calculated from the buyer-generated invoices.
- Dispute management: Suppliers use REMADV data to identify unauthorized deductions and initiate dispute resolution processes with supporting documentation.
Example Snippet
UNH+1+REMADV:D:96A:UN:EAN008'
BGM+481+REM-2024-05678+9'
DTM+137:20240401:102'
RFF+PQ:PAY-2024-001234'
NAD+PY+5412345000013::9'
NAD+PE+4012345000010::9'
FII+RB+DE89370400440532013000:25:131:Deutsche Bank'
CUX+2:EUR:4'
DOC+380+INV-2024-00100'
MOA+9:2550.00'
MOA+12:2499.00'
AJT+4'
MOA+4:51.00'
DOC+380+INV-2024-00101'
MOA+9:1200.00'
MOA+12:1200.00'
MOA+86:3699.00'
UNT+16+1'Implementation Considerations
Ensure the DOC segment correctly identifies the document type (380 for invoice, 381 for credit note) and carries the exact document number as it appears on the supplier's invoice. Mismatched reference numbers are the most common cause of failed automatic reconciliation.
Handle partial payments gracefully — a buyer may pay only part of an invoice amount, leaving the remainder open. Your accounts receivable system should be able to partially close an invoice based on the MOA amounts in REMADV and maintain the residual balance.
Coordinate the REMADV timing with the actual bank payment. Ideally, the REMADV arrives shortly before or simultaneously with the bank credit. If the REMADV arrives too early, the supplier may attempt to reconcile before the funds are available. If it arrives too late, the supplier has already performed manual matching.