Looking for the best invoicing software? Small-business invoicing and and billing in 2020

TransferWise
06.29.20
9 minute read

Managing your invoices, billing and balancing the books is probably not the highlight of your week. However, research shows that you’re 30% more likely to get paid if you make it easy for customers to settle their invoice online¹ - making it crucial to invest some time in finding the right invoicing and billing software for your business.

Don’t get caught up in administration. Leave yourself more time to grow your business, with one of these great online invoicing solutions.


This guide will cover:

We’ll also take a brief look at how to manage without specific invoicing software. This might be an option if you produce only a low volume of invoices and want to keep things simple for now.

A note on overseas business payments

Before we get started on invoicing software, a short word on sending and receiving international payments.

In today’s world, the chances are you work with customers, suppliers, or employees who may be based outside of the US. And even if you don’t already, international expansion is a key step for many entrepreneur’s growth plans.

Sending and receiving international payments - to pay or get paid from abroad - can be costly. But it doesn’t have to be, if you use a specialist like TransferWise for business.

TransferWise offers low cost, secure, international payments, and a multi-currency business account to manage your money in dozens of currencies and can be up to 19x cheaper than PayPal.

Start saving today with TransferWise

Even better, you can integrate your TransferWise for business account with accounting software like Xero, to receive payments from all over the world, and save time on balancing your books.

More on that, later. Let’s take a look at some of the best small business invoicing and billing solutions for 2020.


Best for end to end services: Freshbooks

Freshbooks offers customers a full range of products and services, which means you can do your invoicing and accept payments online, as well as accessing end to end support including:²

  • Invoicing software
  • Online payments
  • Software for estimates and quotes
  • Expense and receipt management
  • Time tracking

At the time of research, discounted package prices apply for monthly fees - there’s also a further reduction in the cost if you sign up on an annual basis instead of month to month. The range of pricing models means that Freshbooks has a solution for most types of business - from entrepreneurs and startups with low levels of billing, through to established companies with large teams.

Here are the monthly price options available:³

Plan type Lite Plus Premium Select
Cost per month $6 $10 $20 Custom pricing
Number of billable clients 5 50 500 500+

It’s worth noting that there are also charges for accepting online payments, on top of the monthly fees. This is commonplace, as payments need to be processed through a third party. You’ll pay 2.9% + $0.30 for Freshbooks Payments taken through a card or Apple Pay, and 1% for ACH payments.⁴


Best for no monthly fees: Wave

Wave offers invoicing, accounting and receipt management software with no monthly fee. You don’t even need to enter your credit card details when you set up an account. ⁵

You’ll be able to make your own customized invoices, which are simple to use and professional looking. You can also set up recurring billing, and all of your invoices will be automatically synced to your Wave accounting service for ease.⁶

Wave makes its money through payroll services, and through online payment processing. This means that you will pay a fee if you accept a payment online through an invoice you’ve created with Wave. Here are the fees you should know about:⁷

Service Wave fee
Credit card payment processing 2.9% + $0.30
American Express payment processing 3.4% + $0.30
ACH payment processing 1%
Other charges Dispute resolution fee $15Return payment fee $5

Best if you’re invoicing internationally: Xero

Xero accounting offers real time management and reconciliation of invoices, as well as options for managing your expenses and inventory, creating quotes and estimates and other handy time saving tools.⁸

There are several different monthly fees, depending on the type of business you’re running and the volume of invoices you’ll need to handle. Here are your options:⁹

Xero plan option Early Growing Established
Price per month $9 $30 $60

With Xero you can set up repeat invoices, automatically chase down unpaid bills, bulk send invoices, and create and manage invoices on your phone.¹⁰

A neat feature of Xero is the option to manage multiple currency payments for a low fee. You’ll be able to sync your Xero accounting package to a TransferWise for business multi-currency account, so you can connect easily to customers all over the world by accepting payments in their currencies.

TransferWise lets you hold dozens of currencies in your account, and you’ll get your own bank details for the US, UK, euro area, Poland, New Zealand and Australia, to get fee free payments in these major regions. You can also get a linked business card, and helpful tools like batch payment options and a powerful open API.

See if you can save with TransferWise

TransferWise for sending money


Best range of monthly package options: QuickBooks

Quickbooks has 5 different types of monthly package¹¹, which have been designed to suit businesses and entrepreneurs of different types. Here are your options - with the current, discounted, prices available at the time of writing.

Check costs online if you plan on signing up, as discounts and offers will change over time.¹²

Package type Self-employed Simple start Essentials Plus Advanced
Fee per month $1 $8 $12 $21 $45

QuickBooks monthly plans give more features for the more costly packages, making them suited to a range of businesses. You can also add on payroll services, or an appointment with a bookkeeper to set up your accounts in the first place. Invoices are customized, meaning you can change the colors and fonts, and add logos to make them your own.

You’ll also be able to easily add billable hours to an invoice. This is automated through Google calendar, the QuickBooks time tracking software, or TSheets, and a smart feature if you bill by the hour and want to save time on your admin.¹³

As well as your monthly package price, there are fees for accepting online payments - here’s what you’ll pay:¹⁴

  • ACH payments - 1%
  • Swiped card payments - 2.4% + $0.25
  • Invoiced card payments - 2.9% + $0.25
  • Keyed card payments - 3.4% + $0.25

Best automated workflow options: Zoho

Zoho offers a large suite of tools for entrepreneurs and businesses everywhere[15]. You’ll find sales and marketing tools, apps to make remote collaboration easier, finance support, HR, IT and business intelligence. You can use your own selection of the tools available or look at the bundles which cover - for example - your IT needs, or everything you need to manage your business finances.

If you need an invoicing tool, Zoho has all you’d expect from an online invoicing platform, including the option to customize your invoices, accept online payments, track time and expenses, and create estimates.¹⁶ Here’s what you’ll pay for the service:¹⁷

Zoho plan Free Basic Standard Professional
Price per month $0 $9 $19 $29

If you want to accept payments online from your invoice, you’ll need to choose a third party payment provider. Zoho supports a range of payment gateways including Stripe, Square and PayPal. The fees you pay per transaction will then be set by the payment gateway you select.¹⁸

One handy feature of Zoho is Zoho Flow¹⁹. This lets you link apps to automate business workflow, and make sure that all the information you need is where you need it. There’s no complex coding involved and you can even select off the shelf packages which have been created to automate common business processes. You can connect over 400 apps, which can save you precious time.²⁰


Best if you need POS services: Square

Square invoicing is a strong option, and especially so if you also make in person sales and need point of sale services.

When it comes to invoicing, you’ll be able to manage everything you need via the Square app, including creating and tracking invoices and estimates, setting up recurring invoices and chasing overdue payments. Invoices are customized and professional, and you’ll be able to access online payment services too.²¹

There is no monthly fee for using Square invoices, but you’ll pay 2.9% + $0.30 per invoice paid online. This fee rises to 3.5% + $0.15 if the customer allows Square to hold their card details on file, to make it easier to pay next time.

Where Square is really useful is in offering in person payments alongside your invoices. If you sometimes use invoices to collect payment, but are also interested in getting paid in person, Square might be a good choice.²²

For example, let’s say you have a vintage store, and sell online mainly, but also want to test out visiting and selling at some local markets. Square would let you manage both online and in person payments using the same system. With the POS solutions you can accept contactless card payments, take payments using your phone, or get a reader to manage swipe payments. There are different fees for this service - typically 2.6% + $0.10 per transaction.


Looking for a different solution? Best way to generate your own invoices without specialist software

Invoicing and accounting software isn’t the only way to generate invoices, of course. If you’re looking for a way to create your own invoices without needing to spend hours duplicating information, you can use Google Sheets, and a mail merge to create invoices using free templates.

This does involve having a little bit of know how - but there are plenty of ideas and tutorials available online if you want to do this yourself without investing in specialist software.²³

**If you create your own invoices, you’ll also want an easy way to let your customers settle up their bills with you. **

You may also choose to accept payments using a peer to peer payment application, depending on your business situation.
Some business bank accounts allow the use of Zelle, for example - although this isn’t possible for all accounts, and you may pay a fee for the service.²⁴
You can also use Venmo for business.²⁵ There’s a fee to pay, but as Venmo is already used by many customers, and is convenient, this charge may prove worthwhile.

A final option, if you don’t want to get a full invoicing and accounting package, is to use PayPal’s invoicing tools and take payment to your PayPal account.²⁶

This is simple to use, and lets customers pay easily with just a few clicks. In fact, research shows that 78% of PayPal invoices are paid the same day they’re received. However, there are some drawbacks, including the fees. You’ll pay 2.9% + $0.30 per transaction paid using a US based card. However, the fees ramp up quickly if you’re paid using a foreign card, and you may need to pay a charge to withdraw your money to your business account if you need quick access to your money.²⁷


Less time spent on creating and chasing invoices means more time to invest in your business. Getting the right solutions in place for managing your invoices and accounting can make all the difference, leaving you free to do what you’re best at. Try one of these solutions for your business in 2020, and see how much of an impact smart online invoicing can make.


Sources:
  1. 7 Tips for Billing Customers That Will Get You Paid Faster
  2. Freshbooks
  3. FreshBooks - Pricing
  4. Freshbooks - Accept payments
  5. Wave
  6. Wave - Invoicing
  7. Wave - Pricing
  8. Xero
  9. Xero - Pricing
  10. Xero - Online Invoices
  11. QuickBooks®: Official Site | Smart Tools. Better Business.
  12. Quickbooks - Pricing
  13. Quickbooks - Invoicing
  14. Quickbooks - Payments
  15. Zoho - Cloud Software Suite and SaaS Applications for Businesses
  16. Zoho - Online Invoicing for Small Businesses
  17. Zoho - Invoicing Plans and Pricing
  18. Zoho - Accept Online and Credit Card Payments
  19. Zoho - Flow
  20. Flow - Ready to use automation workflows
  21. Square - Send Invoices Online Free
  22. Square POS
  23. Google Sheets - Automated monthly invoice generation from CLIENT LIST per month. - Docs Editors Community
  24. Zelle - Small business owner FAQ
  25. Venmo - Business purchases
  26. PayPal - Create & Send an Online Invoice for Free
  27. PayPal - Merchant fees

All sources checked 24 April 2020


This publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax or other professional advice from TransferWise Limited or its affiliates. Prior results do not guarantee a similar outcome. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date.

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