What is payment gateway reconciliation?

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Payment gateway reconciliation is the process of matching transaction records from a payment gateway — Stripe, Razorpay, PayU, Adyen, or similar — against bank settlement data and the corresponding entries in the ERP or accounting system, to confirm that every payment collected has been correctly accounted for.

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Why it is complex

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A payment gateway captures each transaction individually, in gross amounts, at the moment it occurs. A bank settlement is a net payout — typically batched across hundreds or thousands of transactions, with gateway fees already deducted — that arrives one to two business days after the transactions took place.

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This means the same payment appears as three different data points: a gross individual transaction in the gateway, a net batched credit in the bank, and an invoice or journal entry in the ERP.

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How payment gateway reconciliation works

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Step 1 — Extract gateway data. Pull all transaction records from the payment gateway for the period — including successful payments, refunds, chargebacks, and disputes.

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Step 2 — Extract settlement data. Pull bank settlement reports showing each payout received, the transactions included, and fees deducted.

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Step 3 — Match transactions to settlements. Confirm that each gateway transaction appears in the correct settlement batch. Verify that the net settlement amount equals gross transactions minus fees.

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Step 4 — Match to ERP. Confirm that each settlement has been correctly recorded in the ERP.

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Step 5 — Investigate exceptions. Unmatched transactions, settlement shortfalls, unrecorded refunds, and chargebacks are investigated and resolved.

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Why this matters at scale

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For e-commerce, retail, and subscription businesses processing thousands of transactions daily across multiple payment gateways and currencies, this process is one of the most labour-intensive in the finance calendar.

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Related: Account reconciliation · Bank reconciliation · ERP reconciliation · Order-to-Cash (O2C)