diff --git a/src/invoice/payments/payments.component.test.tsx b/src/invoice/payments/payments.component.test.tsx
new file mode 100644
index 0000000..ae08ee3
--- /dev/null
+++ b/src/invoice/payments/payments.component.test.tsx
@@ -0,0 +1,132 @@
+import React from 'react';
+import { render, screen } from '@testing-library/react';
+import userEvent from '@testing-library/user-event';
+import { useVisit, useConfig, navigate } from '@openmrs/esm-framework';
+import { useBillableServices } from '../../billable-services/billable-service.resource';
+import Payments from './payments.component';
+import { type MappedBill, type LineItem } from '../../types';
+
+// Add this mock for currency formatting
+const mockFormatToParts = jest.fn().mockReturnValue([{ type: 'integer', value: '1000' }]);
+const mockFormat = jest.fn().mockReturnValue('$1000.00');
+global.Intl.NumberFormat = jest.fn().mockImplementation(() => ({
+  formatToParts: mockFormatToParts,
+  format: mockFormat,
+})) as any;
+global.Intl.NumberFormat.supportedLocalesOf = jest.fn().mockReturnValue(['en-US']);
+
+jest.mock('@openmrs/esm-framework', () => ({
+  useVisit: jest.fn(),
+  useConfig: jest.fn(),
+  showSnackbar: jest.fn(),
+  navigate: jest.fn(),
+  createGlobalStore: jest.fn(),
+  createUseStore: jest.fn(),
+  useLayoutType: jest.fn().mockReturnValue('desktop'),
+  formatDate: jest.fn().mockReturnValue('2023-09-01'),
+}));
+
+jest.mock('../../billing.resource', () => ({
+  processBillPayment: jest.fn(),
+}));
+
+jest.mock('../../billable-services/billable-service.resource', () => ({
+  useBillableServices: jest.fn(),
+}));
+
+describe('Payments', () => {
+  const mockBill: MappedBill = {
+    uuid: 'bill-uuid',
+    id: 1,
+    patientUuid: 'patient-uuid',
+    patientName: 'John Doe',
+    cashPointUuid: 'cash-point-uuid',
+    cashPointName: 'Main Cash Point',
+    cashPointLocation: 'Main Hospital',
+    cashier: {
+      uuid: 'provider-1',
+      display: 'Jane Doe',
+      links: [
+        {
+          rel: 'self',
+          uri: 'http://example.com/provider/1',
+          resourceAlias: 'Jane Doe',
+        },
+      ],
+    },
+    payments: [
+      {
+        uuid: 'payment-1',
+        dateCreated: new Date('2023-09-01T12:00:00Z').getTime(),
+        amountTendered: 100,
+        amount: 80,
+        instanceType: {
+          uuid: 'instance-1',
+          name: 'Credit Card',
+          description: 'Credit Card payment',
+          retired: false,
+        },
+        attributes: [],
+        voided: false,
+        resourceVersion: '1.0',
+      },
+      {
+        uuid: 'payment-2',
+        dateCreated: new Date('2023-09-05T14:00:00Z').getTime(),
+        amountTendered: 200,
+        amount: 180,
+        instanceType: {
+          uuid: 'instance-2',
+          name: 'Cash',
+          description: 'Cash payment',
+          retired: false,
+        },
+        attributes: [],
+        voided: false,
+        resourceVersion: '1.0',
+      },
+    ],
+    receiptNumber: '12345',
+    status: 'PAID',
+    identifier: 'invoice-123',
+    dateCreated: '2023-09-01T12:00:00Z',
+    lineItems: [],
+    billingService: 'Billing Service',
+  };
+
+  const mockMutate = jest.fn();
+  const mockSelectedLineItems: LineItem[] = [];
+
+  beforeEach(() => {
+    jest.clearAllMocks();
+    (useVisit as jest.Mock).mockReturnValue({ currentVisit: null });
+    (useConfig as jest.Mock).mockReturnValue({ defaultCurrency: 'USD' });
+    (useBillableServices as jest.Mock).mockReturnValue({ billableServices: [], isLoading: false });
+  });
+
+  it('renders payment form and history', () => {
+    render(<Payments bill={mockBill} mutate={mockMutate} selectedLineItems={mockSelectedLineItems} />);
+    expect(screen.getByText('Payments')).toBeInTheDocument();
+    expect(screen.getByText('Total Amount:')).toBeInTheDocument();
+    expect(screen.getByText('Total Tendered:')).toBeInTheDocument();
+  });
+
+  it('calculates and displays correct amounts', () => {
+    render(<Payments bill={mockBill} mutate={mockMutate} selectedLineItems={mockSelectedLineItems} />);
+    const amountElements = screen.getAllByText('$1000.00');
+    expect(amountElements[amountElements.length - 3]).toBeInTheDocument();
+    expect(amountElements[amountElements.length - 2]).toBeInTheDocument();
+    expect(amountElements[amountElements.length - 1]).toBeInTheDocument();
+  });
+
+  it('disables Process Payment button when form is invalid', () => {
+    render(<Payments bill={mockBill} mutate={mockMutate} selectedLineItems={mockSelectedLineItems} />);
+    expect(screen.getByText('Process Payment')).toBeDisabled();
+  });
+
+  it('navigates to billing dashboard when Discard is clicked', async () => {
+    render(<Payments bill={mockBill} mutate={mockMutate} selectedLineItems={mockSelectedLineItems} />);
+    await userEvent.click(screen.getByText('Discard'));
+    expect(navigate).toHaveBeenCalled();
+  });
+});