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Invoice - Prompt Payment / Settlement Discount

To apply a prompt payment discount/settlement discount to an Accounts Receivable invoice from the match items screen in the Bank Reconciliation.

Purpose: So users can offer early discounts to vendors/suppliers without needing to do manual credit notes or editing the invoices.

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AdminXero Team (Admin, Xero) shared this idea  ·   ·  Report…  ·  Admin →
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Accepted  ·  AdminKelly Munro (Community Manager, Xero) responded  · 

Hi everyone, we thoroughly appreciate everyone’s interest and support for enabling the ability to apply a prompt payment discount to invoices.

We understand how a direct prompt payment discount feature would improve the efficiency and automate manual efforts currently involved for you all here, but would like to be transparent that this isn’t something we’ve been able to roadmap atm.

Right now, one way to indicate that your business accepts or will apply a discount for prompt payment would be to write this into the invoice payment terms. When acted on there are a few ways you could consider recording this in Xero, such as;

  • Edit the invoice to apply a discount directly
  • Edit the invoice to add a negative line that directly draws down the total amount of the invoice
  • Apply a credit to the invoice for the portion of the discount

We'd recommend connecting with your Xero advisor on how they'd recommend recording this in your org.

Alternatively, there are connected invoicing apps that you can explore through our Xero App store.

We'll continue to track support through this idea, and our product teams will continue to consider this in future planning, so if there’s any updates we’ll share here. Thanks

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  • Karen Soich commented  ·   ·  Report

    Has this actually been developed? We apply prompt payment discounts to all our invoicing.

  • Peter Humphrey commented  ·   ·  Report

    Hi Denym, Your tool looks nice, but at $39USD per month, it doubles the cost of Xero.

    "Denym Bird commented
    · May 01, 2023 12:44 · Report
    Taking this thread as a bit of inspiration, I went ahead and built this feature in our late fee Xero app, Paidnice... Open to feedback from the community here... https://www.paidnice.com/prompt-payment-discounts"

  • Grant Smith commented  ·   ·  Report

    I hope we can make sure we continue to tell the team at xero that this is critical for business and they should get it resolved. I also hope that we can rise to maintain our civil and persistent pressure.

    Xero has much value, but needs to hear this need is important. We shoud be getting a management response TOO!

  • Admin Operator commented  ·   ·  Report

    Larissa - Can I just say you are going to Regret going from MYOB to Xero "Building Beautiful" let me tell you there is not even Building BASIC with Xero - no Support nothing every get done - for sakes they don't even have 30, 60, 90 days on Customer statements!!! Goood Luck getting anything done

  • Larissa Young commented  ·   ·  Report

    Please implement this function ASAP - I have just switched from MYOB to Xero and am very disappointed that this is not an existing function.

  • Matt Swain commented  ·   ·  Report

    Very basic function not available in Xero. Disappointing given how long this has been requested and how simple to implement.

  • Ben Knight commented  ·   ·  Report

    When reconciling bank feeds can you put an option with the adjustment tab for early payment discount? You can than select all invoices to be reconciled and if amount calculates to the statement you can than select discount and apply the discount amount?

  • Jon Giddings commented  ·   ·  Report

    A basic function for any other package we have used in our business. No other has been without it. We moved to Xero because it syncs with our new POS & operating system. Extremely surprised & totally disappointed that auto calculation of settlement discount & early payment discount is not standard for both suppliers & customers. Surely, it's not that difficult to implement.

  • Brian Kenny commented  ·   ·  Report

    It really is a very basic accounts package unction. Xero is the first package that I have come across in 30 years that has not got this function. The discount allowed automatically adjusts the total amount for GST e.g. Invoice is $110 including GST, the customer only pays $100, Xero would automatically adjust the GST payable amount to $9.09 - that is then the amount the supplier (me) will remit to the ATO.

  • Ivan Podres commented  ·   ·  Report

    Please get this done asap it would be so helpful to get paid on time more often!

  • Peter Humphrey commented  ·   ·  Report

    Cash is king. This would encourage our clients to pay faster

  • Udo Systems Accounts commented  ·   ·  Report

    Would be great to see 2 levels of discounts.

    Pay on time discount & pay early discount structures.

    And setting rules for customers with these in place so it recognizes the payment amounts.

    thanks

  • Brian Kenny commented  ·   ·  Report

    A customer pays $1,000.00 to settle a $1,000.50 invoice. Button please to allow the $0.50 discount. Or, allowing a customer 2% discount for payment within 7 days, button with discount % rate please. Thank you :)

  • Richard Penny commented  ·   ·  Report

    Cash flow is such a challenge and having the ability to add a discount for payment on time is critical. Its already used in many applications, like Speeding fines, Car Registration, Council Rates so we need to have this option added ASAP.

  • Thomas Liu commented  ·   ·  Report

    PLEASE! Essential for every business these days. Very helpful to cash flow.

  • Grant Smith commented  ·   ·  Report

    How is this not already done. Early payment discounts generate sales! Get this done ASAP, please

  • Tomas Finneran commented  ·   ·  Report

    This is also vital for customer statements, and ideally where the discount could be calculated and displayed automatically e.g.

    "Pay the balance of your fees before 31st March 2023 and save [5% of their balance shown here in € ]"

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