---
title: "Overpayment: definition | Rex glossary"
description: "When a customer pays more than the invoices it meant to settle, leaving a credit balance to refund or apply to future invoices."
canonical: https://www.rex.inc/glossary/overpayment
---

# Overpayment

When a customer pays more than the invoices it meant to settle, leaving a credit balance to refund or apply to future invoices.

Overpayments usually come from duplicate payments, paying an invoice that was already credited, or rounding and currency differences.

They're easy to ignore because the cash is in hand, but credit balances may need refunding, and in some places balances left unclaimed must eventually be reported as unclaimed property.

## Related terms

- [On-account payment A payment recorded against a customer's account as a whole rather than specific invoices, usually until it's clear what the payment is for.](https://www.rex.inc/glossary/on-account-payment)
- [Credit memo A document that reduces what a customer owes, issued for returns, pricing errors, agreed concessions or approved deductions.](https://www.rex.inc/resources/glossary/what-is-a-credit-memo)
- [Cash application Matching incoming payments to the open invoices they pay and posting them in the ERP, so receivables and cash stay accurate.](https://www.rex.inc/resources/cash-application/what-is-cash-application)

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