No reference at all
The bank shows a payer name and an amount, nothing else. The engine looks for open invoices from customers with a similar name and the same or combined amount and suggests the best match with a reason.
Cash application software that applies every payment to the right invoice
Cash application software takes the payments that arrive in your bank and applies them to the open invoices they pay. Reconciles reads your bank statement or payout file and your open invoices, uses remittance details, references and customer names to match each payment, and puts deductions, overpayments and unidentified cash in a short queue.
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Remittance matching from bank to invoice
Cash application is the daily step that keeps receivables accurate. Reconciles matches every incoming payment to its invoices using everything the payment carries.
- Bank transfers matched by amount, invoice reference and payer name.
- Card and wallet payments matched through the processor payout breakdown.
- Remittance details in the bank reference field used to identify the invoices being paid.
- Payments covering several invoices split across them.
- Payments with no invoice reference matched by amount and customer with a confidence score.
The payments that slow cash application down
Payer name differs from customer name
A parent company pays for a subsidiary, or a bank shortens the name. Fuzzy payee matching connects them, and once confirmed you can save a rule so the next payment applies automatically.
Deductions and short pays
A customer pays less than the invoice and keeps a discount or a disputed amount. The payment is applied and the difference is shown as an amount difference for your team to approve or chase.
Overpayments and prepayments
A payment larger than the open balance is applied to the invoice, and the extra amount is listed as unapplied cash for the customer.
How cash application works in Reconciles
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01 Parse
Upload your bank statement in CSV, XLSX, OFX, QFX, MT940 or CAMT.053, or a processor payout export, together with your open invoices in CSV or XLSX.
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02 Normalize
Payer names, invoice numbers and amounts are cleaned, and remittance text is split into the references it contains.
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03 Match
Exact reference and amount matches come first, then combinations of invoices, partial payments, fuzzy names and saved rules. AI suggestions cover unclear payments with a confidence score and a plain reason.
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04 Exceptions
Unidentified payments, deductions and overpayments go to the queue. Nothing posts to your ledger without review.
Cash application exceptions by type
- Unmatched a payment with no identifiable invoice, or unidentified cash.
- Partial a payment that covers part of an invoice.
- Duplicate a payment received twice for the same invoice.
- Amount difference a deduction, short payment or overpayment.
- Date difference a payment far from the expected date, such as a very late payment on an old invoice.
On Growth each exception goes to the person who owns the customer, with comments on the item. On Scale applied payments go through approvals before export. Unidentified cash also stays visible in your bank reconciliation software run until it is applied.
Applied payments ready to import
Export applied payments as CSV with invoice, customer, amount applied and the match reason. On Growth, journal entries for applied cash, write offs of small differences and bank charges go out as CSV for QuickBooks and Xero, and on Scale for NetSuite. The same results feed your accounts receivable reconciliation at month end, so the aged report and the control account agree. For card and wallet payments see payment reconciliation software, and for invoice side matching see invoice reconciliation software.
Which plan fits your cash application volume
Every payment line and every invoice line counts as a transaction. Starter covers 3,000 a month and 300 AI suggestions, enough for a few hundred customer payments. Growth covers 20,000 with 2,000 AI suggestions and unlimited rules, which suits teams that apply cash daily. Scale covers 100,000 with API and SFTP drop, so bank files arrive without uploads.
Cash application questions
It is the step of applying each customer payment to the invoices it pays, so receivables show what is truly open. Reconciles does the matching and leaves only unclear payments for review.
Yes. It finds the combination of open invoices from the same customer that adds up to the payment, including credit notes deducted by the customer.
It is matched by amount and payer name with a confidence score. If no candidate is strong enough, it stays in the queue as unmatched.
Yes. Save rules such as "payee contains" a parent company name to apply payments to a subsidiary's invoices, and they run on every future reconciliation.
Apply this week's payments
Upload a bank statement and your open invoices and see each payment applied with its reason in minutes.