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.
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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Riaan Badenhorst
commented
@Tomas Finneran. I honestly have given up. Don't need frustration in my life. I have seen less voted and less importants features added. Cannot say how they evaluate a request. My clients that is on Xero (pay for Xero themselves) have left at Xero. Clients I pay for, I have moved to something more suitable. I do not recommend may clients Xero any longer, but If they want Xero, I do assist.
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Tomas Finneran
commented
This feature is vital, find it strange that Xero would not want to include it. Please add as soon as possible.
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Christa Boren
commented
@PamDyer
Your timing here is perfect. This is becoming critical for us and Xero seems to have no intention of ever implementing this change. I was just going to ask which other services have this feature as we have no hope of Xero helping at this point. Will start looking at Sage and Quickbooks. -
Pam Dyer
commented
We are new to Xero and we too offer early payment discounts. So surprised to see this basic feature isn't standard in Xero. Both QuickBooks and Sage have this feature. Entering a CRN for each discount is extremely time consuming. Please add this feature asap!
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Riaan Badenhorst
commented
@Kevin Burrows. There is a better chance for peace in the Middle-East before Xero will listen to, what should be industry standard feature.
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kevin Burrows
commented
Please instigate this feature, it is essential to our business.
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Thomas Unwin
commented
Yes spot on Riaan - there's one issue i saw a couple of months ago which only had 2 votes at the time and was already "Under Review" with a Xero employee called Kelly having replied.
The issue was to "add more gender options". Not that i'm denigrating the specific request, but there were only 2 votes on it when i first saw it and it was already under review with a response!!
Meanwhile, as per my original comment below here - THIS issue which is pretty vital, speaks directly to Xero's "WHY"/ stated purpose of existing and that, when you add together with other postings for basically the same thing, has been viewed thousands of time with no review.
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Riaan Badenhorst
commented
Yes, Alex with all these comments (and other features that should be considered standard), I do not know as well? Lessor voted request are adhered too. To be brutally honest, its just feels like Xero went from a real peoples company (what I loved from Xero) to a very commercialised, we do what we like business, same as Sage. Maybe money does change one?
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Alex Watt
commented
Absolutely VITAL for our business. Not sure what to do without it to be honest.
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Michael Chou
commented
Xero please can you implement this ASAP
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Riaan Badenhorst
commented
This suggestion was requested already https://central.xero.com/s/question/0D51N00004GHabYSAT/can-you-apply-an-early-payment-discount-on-invoices-for-customers. It has over 3000 views and is closed now. Still being ignored by Xero. WOW!!. They forget that accountants and advisors has a strong influence on what their customers must use. Maybe 3 mil subscribers, mostly encouraged by advisors than advertising.
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Richard Fletcher
commented
Has there been any movement on this idea, Transport and Main Roads Queensland have this in place for registration renewals. i,e. if paid before xx/month/year the price is $xx, if paid after then full invoiced price. if a gov't dept. has it it's not that revolutionary.
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Christa Boren
commented
This feature would be so helpful but I won't hold my breath. It was first requested in 2013 and there are still people asking for it every month, I found this after looking at another thread on the same topic. I don't think that Xero will ever listen. Like so much with Xero it mainly works and then it doesn't.
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Sharon Bolderson
commented
I've had a request from a client for this - it would be a helpful feature.
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Roy Brown
commented
I have a new client who needs this option when trading with WH Smiths and Holland and Barrat
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Henrikus Roesch
commented
Need to add early payment / settlement discount without having to issue a separate credit note for individual invoices.
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Cathy Newport
commented
this is an important function and takes extra time to add a credit note.
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Lizelle Mostert
commented
Our distributors get a discount per line item, and then some of them get an additional settlement discount. In Pastel the additional Settlement discount was shown underneath the Sub Total, just before VAT was added. I am in desperate need for this function to be added.
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Andries Husselman
commented
Has there been any advances regarding settlement discount to a supplier? We have contracts with some of our suppliers and if we pay before the term date due for the specific invoice we are require to get a % discount on this payment..
I see that in the bank recon we can choose adjustments - bank fee and minor adjustment option...? can there not be a adjustment called settlement discount and this will populate or post to a setup discount account?
Please advise on this feature because a credit note is a very time and we would like to make use of a setup or something that will allow this to happen?
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Thomas Unwin
commented
Hi Team,
I see here only 24 votes, however on another thread containing discussion on this topic there are nearly 3000 views. The question was posed in 2018 by Anthony Carter and that thread was closed.
Here is the link: https://central.xero.com/s/question/0D51N00004GHabYSAT/can-you-apply-an-early-payment-discount-on-invoices-for-customers
Is it possible that the importance of this feature is flying under the radar - the fact that 3000 views have happened on that other thread indiactes a strong interest in this feature being added.
At a time where cashflow is more important that ever for small businesses, it feels like here is a feature that Xero could work on that would genuinely help small businesses to incentivise their larger customers to pay sooner/ on time and help alleivate stress.
This blog on Xero describes Xero's "why" as "making life better for small businesses (https://www.xero.com/blog/2019/09/driven-by-purpose-the-customer-experience-journey/)
So I feel that in that vein, this feature should be bumped up because it is something that can directly impact cashflow for small business customers of Xero, therefore making life better for them.