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Setup

Before you can start using 365 business Banking, you need to configure some basic settings in Microsoft Dynamics 365 Business Central. The installation of 365 business Banking already provides a basic setup, which you can customize to meet your specific requirements.

General Ledger Setup

In the General Ledger Setup, under the Banking section, you will find the settings for 365 business Banking. The following options are available:

Field Name	Description	Default Value
Bank Account Chart Balance Type	Specifies the type of balance to be used in bank account charts.	Period Balance
Payment Reference Overflow Option	Specifies what to do if multiple invoices are paid, but the payment reference exceeds the maximum length.
Bank Account Reconciliation Line Posting	Specifies how G/L Account bank account reconciliation lines are posted, when posting setup is specified. Select whether to use a clearing account or post directly to the G/L accounts.	Use Clearing Account
Create Bank Accounts	Specifies whether bank accounts should be created automatically when payment reconciliation journal lines for new customer or vendor bank accounts are applied. This option leads to a higher rate of automatically reconciled bank transactions, as more bank accounts are available for reconciliation.	Yes
Bank Account No. Series	Specifies the number series for bank accounts.	Microsoft Standard
Standing Order No. Series	Specifies the number series for standing orders.	SO00001 - SO99999
Payment Advice No. Series	Specifies the number series for payment advices.	RN00001 - RN99999

Bank Account Chart Balance Type

The Bank Account Chart Balance Type option determines which type of balance is displayed in the bank account charts. You can choose from the following options:

• Period Balance (default)
  This option shows the balance based on transactions within the displayed period (e.g., month). This is useful for tracking financial development over a specific period.
• Balance to Date
  This option shows the running balance up to a specific date. This is helpful for viewing the current account balance at a specific point in time.
• Both
  This option displays both the period balance and the balance to date, allowing you to view both perspectives simultaneously.

Payment Reference Overflow Option

The payment reference in bank transactions is limited to 140 characters. In cases of batch payments or settling multiple invoices with one payment, this may result in the payment reference being insufficient to include all document numbers or references. The Payment Reference Overflow Option allows you to define how to handle such cases. You can choose from the following options:

• Create Payment Advice
  The Create Payment Advice option automatically generates a payment advice for the affected items when payments exceed the maximum length of the payment reference.
• Split Payment (Recommended)
  The Split Payment option divides the payment into separate transactions for any additional items not included in the payment reference when the maximum length is exceeded.
• Always Create Payment Advice
  The Always Create Payment Advice option automatically generates a payment advice for every payment, regardless of the payment reference length. This can be useful when payment advices should always be used.

Bank Reconciliation Line Posting

The Bank Reconciliation Line Posting option controls how bank reconciliation lines with the account type G/L Account are posted when a posting setup (general posting groups and VAT posting groups) is defined.

You can choose between the following options:

• Use Clearing Account
  With this method, the payment is first posted against a clearing account.
  The system then creates an additional posting (technically an “invoice” entry) that applies the posting setup to correctly record the expense or revenue and clears it against the same clearing account.
  This method is the recommended setting, as it provides clear traceability and transparency between the payment and the resulting G/L postings.
  It is particularly useful for VAT-relevant transactions, bank fees, corrections, or reconciliation scenarios, ensuring the highest level of control and auditability.

• Direct Posting (default)
  With this method, the payment is posted directly to a G/L account, and the posting setup is applied immediately to the payment entry.
  As a result, the final G/L and VAT entries are created at the moment the payment is posted.
  This can be useful when no simulated receivables or payables are required and the posting process should remain as simple as possible.
  However, transparency is lower because payment and expense/revenue are combined into a single posting.

Comparison of Options

Option	Advantages	Disadvantages	Typical Use Cases
Use Clearing Account	Highest transparency; clear separation of payment and expense/revenue; consistent VAT handling; supports corrections and reconciliation; clear audit trail	More posting lines; slightly more complex	Recommended for most companies; VAT-relevant transactions; bank fees; scenarios requiring deferrals or structured posting logic
Direct Posting (default)	Fewer posting lines; fast and simple process; ideal for straightforward G/L postings	Less traceable; combines payment and expense into one entry; VAT setup applies directly to the payment line	Smaller companies; simple G/L postings without deferrals; cases without complex VAT requirements

Create Bank Accounts

The Create Bank Accounts option determines whether bank accounts should be created automatically when payment reconciliation journal lines for new customer or vendor bank accounts are posted. This option leads to a higher rate of automatically reconciled bank transactions, as more bank accounts are available for reconciliation.

365 business Banking automatically creates new bank accounts in Microsoft Dynamics 365 Business Central when a payment reconciliation journal line with an unknown bank account of a customer or vendor is posted (see Related Party Matching). The new bank account is created with the relevant information from the payment reconciliation journal line or the bank transaction.

Associated Bank Accounts

In the General Ledger Setup, in the Bank action group, you will find the Manage Associated Bank Accounts action. This action opens the Associated Bank Accounts page, where you can manage bank accounts of associated companies to prevent the creation of a new bank account for internal transfers (e.g., in the case of erroneous transfers by the customer) and assign it to the reconciled customer.

Payment Methods

The payment methods determine which types of payments can be used for your bank accounts and transactions. These settings can be found on the Payment Methods page, where you can select and configure the desired payment types.

For more information on setting up payment methods, see the Payment Method Setup documentation.

Banking User Setup

Setting up the Banking User is an important step in establishing a secure connection to your bank accounts. The Banking User is responsible for connecting to your bank accounts and allows you to retrieve transactions and initiate payments.

For more information on setting up the Banking User, see the Banking User Setup documentation.

Additional Settings

In addition to the settings mentioned above, you can make further adjustments to optimally tailor 365 business Banking to your needs. These include:

• ZKA Codes
  ZKA codes (Business Transaction Code, GV-Code) are used to identify specific business transactions. These codes can be managed on the ZKA Codes page.
  For more information, see the ZKA Codes Setup documentation.
• SEPA Purpose Codes
  SEPA Purpose Codes are used to indicate the purpose of a payment. These codes can be managed on the SEPA Purpose Codes page.
  For more information, see the SEPA Purpose Codes Setup documentation.