Customer Payments

When a customer pays you, record it as a Payment Entry in ERPNext. This applies the receipt against the right invoices and updates your books.

Record a payment

Three paths into a Payment Entry:

Path	When
Payment Entry → New	Direct entry — useful for cash receipts
Open a Sales Invoice → Create → Payment Entry	Faster — pre-fills the customer and the outstanding amount
From a Bank Statement	When you process bank lines (see Bank Statements)

Fill in the form

Field	What
Payment Type	Receive (incoming)
Party Type	Customer
Party	The customer who paid
Posting Date	The date the money landed in your bank account
Paid Amount	What they paid
Paid To	Your bank account where the money landed
Reference Type / Reference No	The Sales Invoice(s) this payment settles

Applying against invoices

When you select the customer, ERPNext lists their outstanding invoices in the References table. Tick the invoices being settled, ERPNext computes how to allocate the payment:

Exact match — payment = invoice total → invoice marked Paid
Partial — payment < invoice total → invoice becomes Partly Paid, balance remains
Overpaid — payment > selected invoices → the excess sits as a credit on the customer's account, used against the next invoice

Bank fees

If the bank deducted a fee (€5 transaction fee for a €1000 payment, you receive €995):

Paid Amount = €1000 (the customer paid)
Add a Deductions row: Account = Bank Charges, Amount = €5
Final cash to your bank = €995

Foreign currency

If the customer paid in a different currency than the invoice was in, set the Exchange Rate. The exchange gain/loss is posted to your exchange-rate account automatically.

Status

A Payment Entry has only:

Draft (editable)
Submitted (final, locked, posted to the ledger)
Cancelled (reversed)

Common situations

Customer paid the wrong invoice — cancel the Payment Entry, create a new one with the right references
Bulk payment for many invoices — one Payment Entry can reference any number of invoices; tick all that the receipt covers
Refunding a customer — create a new Payment Entry with Payment Type = Pay (you pay them), referencing the credit note