{"id":56871,"date":"2026-11-09T22:27:14","date_gmt":"2026-11-09T22:27:14","guid":{"rendered":"https:\/\/www.truecommerce.com\/?p=56871"},"modified":"2026-11-09T22:31:24","modified_gmt":"2026-11-09T22:31:24","slug":"edi-payments","status":"publish","type":"post","link":"https:\/\/www.truecommerce.com\/en-gb\/blog\/edi-payments\/","title":{"rendered":"What Is an EDI Payment? How Remittance Works in B2B"},"content":{"rendered":"

If you’ve seen “EDI payment” or “EDI PMT” on a bank statement, you may be wondering what it means. In simple terms, an EDI payment means electronically exchanging payment or remittance information. In a business-to-business supply chain, however, an EDI payment often involves a Remittance Advice, a transaction trading partners can use to communicate payment instructions, remittance details, or both. In EDIFACT codes, it is called a REMADV. For finance and operations teams, that electronic exchange can solve a familiar problem: knowing not only that money arrived, but exactly which invoices, deductions, and adjustments go with it.<\/p>\n

What is an EDI payment?<\/h2>\n

So, what is an EDI payment in a B2B transaction?<\/p>\n

An EDI payment, or electronic data interchange payment, is the electronic exchange of payment-related information between businesses using EDI. Rather than sending remittance details through email, paper documents, spreadsheets, or another disconnected process, businesses can exchange that information in a standardized electronic format.<\/p>\n

If EDI itself is new to you, the fundamentals of EDI<\/a> are straightforward: EDI allows businesses to exchange documents electronically in standardized formats so information can move between systems with less manual intervention.<\/p>\n

That distinction matters. The movement of money and the information explaining the payment are closely connected, but they aren\u2019t necessarily the same thing. An electronic funds transfer moves the funds; the EDI Remittance Advice provides the remittance information a business needs to apply those funds accurately.<\/p>\n

How EDI Payments Work: The EDI Remittance Advice<\/h2>\n

Consider what happens after you send a customer an invoice.<\/p>\n

The payment arrives, but it may cover several invoices. One invoice may have been paid in full, another may include a deduction, and another may have an adjustment. Without structured remittance information, your accounts receivable team has to work out where everything belongs. The EDI Remittance Advice helps connect those dots.<\/p>\n

Here is how EDI payments work in a typical transaction:<\/p>\n

    \n
  1. A buyer places an order with an EDI Purchase Order (ORDERS).<\/li>\n
  2. The seller fulfils the order and sends an EDI Invoice (INVOIC).<\/li>\n
  3. The buyer processes the invoice and initiates payment.<\/li>\n
  4. The buyer sends an EDI Remittance Advice with the payment or remittance information.<\/li>\n
  5. The seller uses that data to match the payment against its open invoices.<\/li>\n<\/ol>\n

    You may also see EDI PMT used as shorthand for an EDI payment or payment transaction in statements and internal systems.<\/p>\n

    Instead of leaving the seller with a deposit and a reconciliation puzzle, the EDI Remittance Advice provides structured information that can tell the business what was paid and how the payment should be applied.<\/p>\n

    What information does an EDI Remittance Advice include?<\/h2>\n

    The usefulness of an EDI payment comes down to the information traveling with it. An EDI Remittance Advice can include details such as:<\/p>\n