When a supplier payment appears on the bank feed before the corresponding purchase invoice has been entered into Xero, reconciling the payment can lead to double counting. Currently, if you record the payment as a spend money transaction and then later enter the invoice, Xero treats them separately. This causes extra work and creates reconciliation inaccuracies.

Introduce a bank rule specifically for supplier overpayments. When the system detects a payment to a known supplier that exceeds the amount of an existing invoice or occurs before any invoice exists, the bank rule would:

1. Post the transaction directly to the payables ledger (accounts payable) as a supplier overpayment or credit.

2. Hold it there until the user is ready to allocate the overpayment against future or newly entered invoices.

3. Allow the payment to be fully reconciled without the risk of double counting.

The benefits would be that;
Prevents duplicate expense recognition when invoices are entered after payments.

Keeps reconciliations clean and accurate, especially for businesses that pay suppliers before receiving invoices.

Saves time by removing the need for manual corrections or re-coding.

Aligns with how overpayments are already treated when initiated from within Xero, just applied from the bank feed side.