Set Up Rules for Automatic Application of Payments

On the Payment Application Rules page, you set up rules to govern how payment text (on a bank transaction) is automatically matched with text on related open (unpaid) invoices, CR/Adj Notes, or other entries when you use the Apply Automatically function on the Payment Reconciliation Journal page. For more information, see Reconcile Payments Using Automatic Application.

You set up new payment application rules by choosing which types of data on a payment reconciliation journal line must match with data on one or more open entries before the related payment is automatically applied to the open entries. The quality of each automatic application is shown as a value of Low to High in the Match Confidence field on the Payment Reconciliation Journal page according to the payment application rule that was used.

Each row on the Payment Application Rules page represents a payment application rule. Rules are applied in the order specified by the Sorting Order field. If multiple rules are used simultaneously, then the match confidence of the highest sorted rule is used.

The automatic application function is based on prioritised matching criteria. First the function tries, in prioritised order, to match text in the five Related-Party fields on a journal line with text in the bank account, name, or address of customers or suppliers with unpaid documents representing open entries. Then, the function tries to match text in the Transaction Text and Additional Transaction Info fields on a journal line with text in the External Document No. and Document No. fields on open entries. Last, the function tries to match the amount in the Statement Amount field on a journal line with the amount on open entries.

Note

Text matching is only possible for text longer than four characters.

In addition to the matching criteria, the following applies concerning the sign of the payment amount:

  • For negative amounts, a match is made first against open entries representing customer invoices and then against supplier CR/Adj notes.
  • For positive amounts, a match is made first against open entries representing supplier invoices and then against customer CR/Adj notes.

To set up a payment application rule

  1. Choose the Lightbulb that opens the Tell Me feature. icon, enter Payment Application Rules, and then choose the related link.
  2. Define a new or edited payment application rule by filling the fields on a line as described in the following table.
Field Description
Match Confidence Specifies your confidence in the application rule that you define on the line.

A value that you specify in this field is shown in the Match Confidence field on the Payment Reconciliation Journal page according to the quality of the automatic payment application on the journal line.
Priority Specifies the priority of the application rule relative to other application rules that are defined as lines on the Payment Application Rules page. 1 represents the highest priority.
Related Party Matched Specifies how much information about the customer or supplier, such as address, city name, and bank account number, on the payment reconciliation journal line must match with information about the open entry before the application rule will be used to automatically apply the payment to the open entry.
Doc. No./Ext. Doc. No. Matched Specifies whether text on the payment reconciliation journal line must match with the value in the Document No. field or the External Document No. field on the open entry before the application rule will be used to automatically apply the payment to the open entry.
Amount Incl. Tolerance Matched Specifies how many entries for a customer or supplier must match the amount including payment tolerance before the application rule will be used to automatically apply a payment to the open entry.
Review Required Specifies whether the automatic payment application is recommended for manual review by the user before posting. Choosing the Lines to Review field on the Payment Application Journal page starts a guided experience where you can easily review multiple applications in a sequence on the Payment Application Review page.

The following table describes the standard payment application rules in Business Central.

Important

The payment application rules may be different in your implementation of Business Central.

Match Confidence Priority Related Party Matched Doc. No./Ext. Doc. No. Matched Amount Incl. Tolerance Matched
High 1 Fully Yes - Multiple One Match
High 2 Fully Yes - Multiple Multiple Matches
High 3 Fully Yes One Match
High 4 Fully Yes Multiple Matches
High 5 Partially Yes - Multiple One Match
High 6 Partially Yes - Multiple Multiple Matches
High 7 Partially Yes One Match
High 8 Fully No One Match
High 9 No Yes - Multiple One Match
High 10 No Yes - Multiple Multiple Matches
Medium 1 Fully Yes - Multiple Not Considered
Medium 2 Fully Yes Not Considered
Medium 3 Fully No Multiple Matches
Medium 4 Partially Yes - Multiple Not Considered
Medium 5 Partially Yes Not Considered
Medium 6 No Yes One Match
Medium 7 No Yes-Multiple Not Considered
Medium 8 Partially No One Match
Medium 9 No Yes Not Considered
Low 1 Fully No No Matches
Low 2 Partially No Multiple Matches
Low 3 Partially No No Matches
Low 4 No No One Match
Low 5 No No Multiple Matches

See Also

Reconcile Payments Using Automatic Application
Managing Receivables
Sales
Work with Business Central