Overview

A credit-only payment run uses supplier credit notes to cover the amounts selected for settlement, with no cash payment required for the run.

You can settle a bill's full outstanding balance or, where partial payments are available, choose a smaller settlement target. Credits must cover that target for the bill to have a credit-only outcome.

Before you begin

• Sync Batchly so the bill and credit balances reflect the latest information from Xero.
• Supplier credit notes must already exist in Xero, be authorised and have an available balance.
• Credits must belong to the same supplier as the bills and match their currency.
• Batchly credit allocation must be available for your organisation and applying credits must be enabled for the relevant supplier.

Batchly-created credit allocations are available on Plus and Scale, with applicable trial and legacy access, subject to your organisation's credit-allocation setting.

How it works

1. Select the bills you want to include. The amount to settle defaults to each bill's outstanding balance unless you choose a smaller partial-payment amount.
2. Review the proposed credits and confirm that no cash remains for the selected targets.
3. Start the payment workflow and review any Review Payment Amounts step shown for partial targets.
4. Complete Apply Credits to write the allocations to Xero, and wait for the credit-settlement workflow to finish.
5. Continue through the remaining steps to send or skip remittances and access the report.

Selecting bills or viewing proposed allocations does not itself apply credits in Xero. The allocations must be successfully processed before the bill balances are reduced.

For a wholly credit-only run, Batchly skips the Pay From and banking-file export steps. No cash payment needs to be recorded through the normal Mark as Paid action.

Examples

Each example starts with a bill that has $1,000 outstanding. The credits shown are eligible and available for that bill. All amounts are in the same currency.

The first three examples are credit-only. In the second example, $200 of credit remains unused. In the third, the $300 target is covered by credits but the bill still has $700 outstanding.

The final example is not credit-only: $400 cash is required to complete the $1,000 target. Its bill balance reaches $0 only after both the credit allocation and cash payment have been successfully recorded.

What appears in the banking file?

A wholly credit-only run does not generate a banking file. Credit-only bills do not create zero-dollar payment lines.

A mixed run can contain both credit-only bills and bills requiring cash. For a supported banking-file workflow, only the cash amounts are included in the file. Credits are allocated separately in Xero.

A bill with no cash to pay can still have a balance left open for a later run if you selected a partial target.

What happens in Xero?

• Successful credit allocations reduce the bill's outstanding balance and the credit note's available balance.
• The bill becomes Paid only when its full outstanding balance has been settled.
• If credits cover only a selected partial target, the rest of the bill stays open.
• Unused credit remains available in Xero. Batchly does not turn it into a cash refund.

You can review the allocations against the relevant bills and credit notes in Xero. No cash payment is created for the credit-only portion.

What suppliers see

If you send remittances, the attached PDF helps explain the bills included and credits applied. A credit-only outcome shows that no cash payment was required for the selected amount; it should not be treated as confirmation that a bank transfer occurred.

You can send remittances or skip them and continue to the report. See How to Send Remittance Advice in Batchly for details.

If cash remains or an allocation fails

If cash remains, check the selected targets, eligible credit balances and proposed allocations across all selected bills. Having credit available for a supplier does not necessarily mean it covers every selected bill.

For partial payments, the amount entered is the total to settle, including credits. See Why Cash May Remain After Credits for examples.

If an allocation fails, review the error and any allocations already completed before retrying. Do not assume the whole run was rolled back. Follow the recovery options shown, or contact support if the outcome is unclear.