Remittance

Reaching widespread adoption for businesses to exchange electronic remittance (e-remittance) information – or details about a payment – with each other remains a primary goal of the Business Payments Coalition (BPC). This is a challenge for the industry primarily due to the unstructured format and detached delivery of remittance information. The BPC is committed to addressing major provider and end user pain points in sharing e-remittance information. As such, the BPC supports industry efforts to align on a common core of remittance content and delivery methods that promote broad adoption of e-remittance data. While the remittance solutions landscape is still evolving, e-remittance capabilities play a strong role in reducing payment application costs and improving overall efficiency. All companies, regardless of size, can benefit from the modernization of delivery of e-remittance information to help reduce payment application costs and improve efficiency.

The BPC with support from the Federal Reserve is convening an industry work group to establish a secure, e-remittance delivery framework – known as an exchange framework. An exchange framework is an electronic delivery network based on a set of technical standards and policies to allow businesses to securely share electronic supply chain documents with one another.

Watch the video below, for an overview of an exchange framework.

Recent Updates

E-remittance Exchange Pilot

The Business Payments Coalition with support from the Federal Reserve, has launched an E-remittance Exchange Pilot (Off-site). Through this pilot program, the payments industry is coming together to test an electronic delivery network – known as an exchange framework – that will enable all kinds of businesses to exchange e-remittance information. The goals of this work effort include:

• Piloting a fully operational e-remittance exchange framework.
• Finalizing recommendations for the ISO 20022 remittance data model.
• Preparing for the establishment of a production e-remittance exchange framework supporting all electronic payment methods.

This pilot phase, which officially kicked off in September 2023 and will run through mid-2024, is the final step before market adoption of an exchange framework for e-remittance information, supporting all electronic payment methods

Remittance Delivery Validation Report

In the summer of 2023, the BPC and Federal Reserve’s Remittance Delivery Work Group completed a validation phase (Off-site), where they demonstrated an exchange framework can both facilitate the exchange of e-remittance information and enable straight-through processing, regardless of accounting system used. With the validation phase now complete, the work group unanimously recommends moving to a pilot phase using the DBNAlliance’s exchange framework. The work group published their findings and recommended next steps in the report below.

Remittance Delivery Assessment Work Group Report

In late 2021, the BPC, in collaboration with the Federal Reserve, formed the Remittance Delivery Assessment Work Group to determine the viability and potential of an exchange framework that would support the U.S. market’s exchange of remittance information across all payment types. Read the press release announcement (Off-site). The work group published their assessment report following evaluation of the electronic invoice (e-invoice) exchange framework, where they determined it is feasible to establish a remittance exchange framework with some minor adaptations. Read more about their findings and next steps in the report below.

Accredited Standards Committee (ASC) X9 Publishes ISO^® 20022 Remittance Content Market Guide

Accredited Standards Committee (ASC) X9’s ISO^® 20022 Market Practices Forum recently released the ISO 20022 Remittance Content Market Guide (Off-site) to clarify what ISO 20022 remittance information to use with business-to-business (B2B) payments. The guide includes detailed information and real-world examples to assist with the implementation of ISO 2022 and simplify integration into accounts payable (AP) and accounts receivable (AR) systems. It also provides guidance for sending remittance information within or separate from the payment, allowing flexibility to meet varying business needs. Read more about what’s included in the guide, why it matters and how this progress will further advance straight-through-processing for B2B payments.

The BPC held an informative webinar about the guide on June 28, 2022. Watch the full webinar recording Remittance Information for B2B Payments in Practice: How to Improve Cash Application (Off-site) and download the webinar presentation (PDF).

Resources

• Simple Remittance Requirements (PDF) (2018)
  This document defines data needs for simple remittance information that can be easily adopted by small and medium businesses (SMBs). It identifies three levels of remittance data, which, if included with an electronic payment, would facilitate cash application and reconciliation for SMBs.
• Article: New Minimum Remittance Data Guidelines Help Small Trading Partners Apply Payments (PDF) (2018)
• Remittance Glossary (PDF) (2014)
  This technical report is a glossary of terms associated with business-to-business payment methods and payment remittance data.
• Remittance Standards Inventory (PDF) (2013)
  The Remittance Standards Inventory is a comprehensive inventory of relevant B2B payment remittance standards.
• Core Adjustment Reason Code Technical Report (PDF) (2013)This technical report presents a streamlined set of codes for adjusting a B2B payment amount and provides an overview of how to use these codes in the exchange and processing of remittance information.

Additional Resources