When you have credits from vendors, you can put them to work reducing what you owe on future bills. This guide covers everything you need to know about using vendor credits with your Melio account.
This article contains the following sections:
- What are vendor credits?
- Vendor credit requirements and compatibility:
- Can I create vendor credits in Melio?
- How to apply vendor credits to a bill
- Viewing vendor credits in Melio
- Removing vendor credits from a bill
- Troubleshooting:
What are vendor credits?
A vendor credit is a record in accounting software used to document, for instance, returns to or refunds from a vendor. It is always linked to a specific vendor and typically arises from scenarios like returned goods or negotiated discounts.
Vendor credits can be applied to the bills to reduce the amount owed, and syncing them with platforms like Melio ensures accurate and up-to-date records across systems.
Vendor credit requirements and compatibility
Accounting software
Vendor credits functionality in Melio varies depending on the accounting software you are connected to:
- QuickBooks Online: You can view and apply vendor credit to the bills in your Melio account.
- Xero, QuickBooks Desktop: You cannot view or apply vendor credit in Melio. However, the vendor credits can be synced into Melio to close the bills paid with vendor credits in the accounting software.
Melio Subscription plan
- Boost and higher plans: You can view and apply vendor credits to bills.
- Go and Core plans: You can view vendor credits, but not apply them to bills.
Can I create vendor credits in Melio?
Vendor credits are created using accounting software, not Melio.
How to apply vendor credits to a bill
❗Important note:
- Please review the Vendor credit requirements and compatibility section of this article before applying vendor credits to a bill.
- The vendor credit amount cannot be customized. If applicable, the maximum available amount will be applied.
- If the vendor credits amount is larger than the total amount of the bill, the remaining credit amount will remain available for later use.
Follow these steps to apply vendor credits to the bill:
1 - Select the Vendors tab in your Pay dashboard to see what vendors have vendor credits available.
2 - Select the vendor in the list.
3 - A Vendor details window will appear. In the Vendor credit section, select View bills.
4 - You will be redirected to the Bills tab filtered by the selected vendor name.
5 - Select the three-dot icon next to the bill to which you want to apply vendor credits.
6 - In the drop-down menu, select Apply credit.
Note: Alternatively, you can do the following:
1 - Select the bill in the list.
2 - A Bill details window will open. Select the More button at the bottom left.
3 - In the drop-down menu, select Apply credit.
7 - A pop-up window will appear asking you to check the details and confirm the action. If everything is correct, select Apply.
If your vendor credits don't cover the entire bill amount, you can apply the available credits and pay the remaining balance using your regular payment method.
That’s it. You successfully applied vendor credit to the bill. A confirmation message will be shown at the top of the page.
Select View details to view this action in the Payments tab. It will appear with a status “Paid with credit”.
You will get an email confirmation with the amount of vendor credit applied.
Your vendor will also get it if their email address is available in Melio.
Viewing vendor credits in Melio
To view vendor credits in Melio, connect your Melio account to QuickBooks Online. Once connected, vendor credit information will be synced and visible.
If you have multiple vendor credits for the same vendor, only the total credit amount is displayed.
You can view:
Viewing available vendor credits
Option 1: Check the Vendors tab under the relevant vendor's name.
Option 2:
1 - Select the vendor from the list.
2 - In the Vendor details window, you'll find available vendor credits in the designated section.
Viewing applied vendor credits
If you have already applied vendor credits to the bill, you can see it by following these steps:
Option 1:
1 - Select the Payments tab.
2 - Find the desired payment, and select View payment.
3 - In the Payment and bill details window, scroll down to the bottom to see any vendor credit applied. It will appear above the bill amount.
Note: If you have a few users in Melio, you can see who exactly applied the vendor credits at the top of the Payment and bill details window.
Option 2:
1 - Select the Bills tab.
2 - Select the bill from the list.
3 - A Bill details window will appear. If any vendor credits were applied to this bill, they appear above the bill amount.
Removing vendor credits from a bill
If you need to remove credits that you've already applied:
1 - Select the Payments tab from your Pay dashboard.
2 - Find the desired payment with the “Paid with credit” status.
3 - Select a three-dot icon next to it.
4 - In the drop-down menu, select Unapply credit.
5 - A pop-up window will appear asking you to confirm the action. Select Unapply to proceed.
That’s it. You successfully removed vendor credits. You'll see a confirmation message.
You will get an email confirmation regarding the change.
Your vendor will also get it if their email address is available in Melio.
Troubleshooting
Refunded payments with vendor credits
If a payment with vendor credits gets refunded, the credits won't automatically return to your Melio account. To fix this:
1 - Restore the vendor credit in QuickBooks Online.
2 - Refresh the sync in your Melio account.
That’s it. The vendor credits will then appear in Melio again.