Pay by invoice
When customers pay by invoice, they receive goods or services and pay later by the agreed due date. The invoice and receipt of payment are tracked separately.
What does pay by invoice mean?
When customers pay by invoice, they receive goods or services and settle the amount later by the agreed due date. Who handles payment and who can use the method depends on the offering. The invoice document alone does not identify this payment method: other payment flows can also include an invoice. The defining feature is the agreed later payment.
A fictional supplier sells identification signs to a workshop. In the example, payment is made on invoice after delivery. The planned workflow links invoice INV-62 to the order, amount and due date. For payment matching, the reference and amount are checked against a confirmed incoming payment. Any outstanding amount stays visible until the invoice amount is covered. The order view therefore displays delivery progress and payment separately.
Sources
Related terms
- Buy now, pay laterBNPL enables a purchase with later payment or instalments. The customer’s payment plan and settlement with the merchant are considered separately.
- Payment service providerA PSP supports businesses with electronic payments. Payment methods, processing and additional services depend on the offering.
- Digital walletA digital wallet uses saved payment methods or a wallet balance for payment. Device support and the shop integration must work together.
- Recurring paymentRecurring payments charge an authorised payment method at agreed intervals. Amount, payment attempt and service status remain separate.
- Subscription commerceIn subscription commerce, customers receive products or services on a recurring basis. Delivery or usage plans and billing need to match.
- RefundA refund returns all or part of an amount already paid. Returning money and returning goods are separate processes.
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