A remittance advice is a short note telling a supplier which invoices a payment covers. It is trivially cheap to send and it removes a surprising amount of work on both sides, because a payment arriving without one leaves the supplier unable to allocate it, and an unallocated payment produces a phone call to you asking what it was for.
What it contains
Your name, the payment date and total, and a list of the invoices covered with their numbers and amounts, plus any credit notes applied. That is all. The list is the point: a supplier receiving a single transfer covering eleven invoices cannot allocate it without knowing which eleven, and guessing produces errors that surface later as a disputed statement.
Why sending it saves you work
Unallocated payments generate supplier queries, and supplier queries land on your team. They also generate incorrect supplier statements, which then need reconciling, which lands on your team again. A remittance advice prevents both at effectively zero cost, and it is one of the few payables improvements with no trade-off at all.
When it matters most
Where you pay several invoices in one transfer, where credit notes are applied, and where the amount differs from any single invoice. Those are exactly the cases a supplier cannot resolve alone. Sending remittances only for round-figure single-invoice payments is sending them where they are least needed.
Questions people ask about what is remittance
Is a remittance advice legally required?
Generally no, and it is a strong convention because it makes the payment usable. Requirements vary, so check your own obligations if in doubt.
How should it be sent?
By email to the supplier's accounts address, automatically as part of the payment run. Manual sending gets skipped in a busy week.
What if the supplier does not use it?
Some do not, and it costs you nothing. The ones who do will stop calling, which is most of the benefit.