Best Accounts Receivable Software for Every Business Type

Selling to customers on credit is a fundamental part of doing business for most companies. The time between delivering goods or services and collecting the cash can mean the difference between a struggling financial position and a thriving one. A lot goes on during this interim period—processing sales contracts, handling customer purchase orders, creating invoices, tracking, and collecting. And while manual processes are no longer sufficient for modern business needs, choosing the right accounts receivable (AR) software from the many available options can be daunting. This guide is designed to help you get straight to the shortlist to find the best-fit AR solution for your business needs, focusing on key features and capabilities that matter most.

What Is Accounts Receivable Software?

AR software is a specialized technology within the accounting environment that handles the accounts receivable resulting from sales made on credit. Full-service AR software automates the entire process—from invoice generation to payment collection to reporting and financial analysis. Key functions of AR software include:

• Invoice management: Creates, sends, and tracks invoices.
• Customer information management: Maintains detailed customer data and transaction history.
• Payment tracking: Monitors and applies incoming payments to outstanding invoices.
• Collections management: Tracks AR aging and automatically creates and sends tailored payment reminders to customers with overdue invoices.
• Systems integration: Connects seamlessly with accounting and enterprise resource planning (ERP) systems for efficient data flow.
• Reporting and analytics: Provides insights into cash flow, payment trends, and customer payment behaviors.

AR software delivers many benefits that help businesses improve cash flow and maintain better customer relationships while increasing financial accuracy. Companies using automated AR solutions and following best practices typically see significant reductions in payment collection times and manual processing hours. The software also helps eliminate common manual errors, such as misapplied payments or missed follow-up opportunities. At the same time, it makes the AR process more efficient and effective, often resulting in lower administrative costs and a staff that’s able to focus on higher-value activities, including customer relationship management (CRM) and strategic financial planning. Many businesses report that AR automation helps them process many more invoices, improve AR turnover, and get paid faster, all without adding head count.

When evaluating AR software options, it’s important to understand that capabilities vary significantly among solutions. Some focus exclusively on invoicing, while others specialize in collections or payment processing. They also differ in their ability to integrate with banks and credit card processing systems, as well as other accounting modules, such as core general ledger systems. For these reasons, it’s essential to look “under the hood” when evaluating the features and limitations of AR software options to ensure that the chosen system aligns with your specific business requirements.

Key Takeaways

• The right AR software increases a company’s profitability, improves cash flow, reduces errors, and saves time and money.
• There are many AR software options on the market, but not all are appropriate for all companies.
• Scalability, cost, integration, and automation features are among the key factors to consider when evaluating AR software.
• Companies prioritize these factors differently when selecting AR software, depending on their size, structure, and stage of growth.

Best Accounts Receivable Software Explained

AR software solutions have evolved to address the needs of diverse business types and sizes. Considerations, such as business size, growth trajectory, staff resources and expertise, budget, and industry-specific nuances, influence software choice. In general, as companies grow and their financial operations become more complex, they require more sophisticated AR capabilities with advanced features, greater scalability, and more robust reporting capabilities. At other stages of a company’s life cycle, certain features may take priority based on immediate needs and long-term objectives. Businesses typically consider the following common factors when evaluating AR software:

• Scalability: Ability to handle increasing transaction volumes, expanding customer bases, and more complex billing scenarios.
• Integration: Compatibility with existing or planned accounting systems, ERP software, and CRM platforms, as well as availability of APIs for custom integrations.
• Automation: Array of automated functions for invoicing, payment reminders and processing, late-fee calculations, and payment reconciliation.
• Reporting and analytics: Depth and breadth of reporting tools and availability of real-time data.
• Ease of use: Intuitive interface design for smooth adoption by staff and accessibility across devices, including desktop, mobile, and tablet.
• Security and compliance: Data encryption, secure payment processing, and compliance with relevant financial regulations, such as the Payment Card Industry Data Security Standard and General Data Protection Regulation.
• Customer portal: Self-service options for customer invoice access, payments, and addressing disputes or queries.
• Customization: Flexibility to adapt to specific business processes or industry requirements, such as creating custom fields on invoice templates or adjusting reports and analyses.

Two universal considerations are cost and vendor support quality. The total cost of ownership, including up-front costs and ongoing fees, is often a top consideration. While some established businesses can justify higher costs by focusing on expected efficiency gains and improved cash flow, others, such as startups, may be constrained by strict burn rates. It’s also important to consider the vendor, in addition to the software itself. The quality of the support and training provided can have a direct impact on how effectively and quickly the business can achieve its desired results.

The importance of each of these factors varies depending on a company’s specific needs and circumstances. The following sections outline the best AR software for distinct business situations.

Best AR Software for Entrepreneurs and Sole Proprietors

Entrepreneurs and sole proprietors often juggle multiple roles, especially when they don’t have dedicated accounting and IT teams. For this reason, AR software that’s simple, affordable, and easy to use tends to be best suited for individuals running their own businesses. Essential functionality includes invoicing, payment reminders, and tracking, with minimal complexity. Mobile access is convenient for managing finances on the go. Three common choices are:

• FreshBooks: This user-friendly software is ideal for basic management of invoices and payments, making it popular with service-based freelancers and sole proprietors looking for simplicity and low cost. Scalability and advanced features require transitions to the vendor’s premium plans.
• Bench Accounting Software: Bench Accounting offers bookkeeping services from dedicated bookkeepers who manage a company’s AR using Bench’s proprietary software. While this makes it a good fit for business owners who want to be hands-off, Bench is significantly more costly than software-only options and less customizable.
• Wave: Wave’sfree starter plan offers basic invoicing and payment collection features, which appeals to sole proprietors and entrepreneurs on a tight budget. However, intermediate features, such as automated late-payment reminders, aren’t part of the starter plan. Additionally, Wave charges a fee for online payments, including credit cards.

Best AR Software for Fast-Growing Businesses

Scalability and flexibility are critical for fast-growing business. AR software must be able to handle rapid increases in transaction volume while maintaining workflow efficiency as the business expands. It should also adapt to changing business models, such as introducing new products and evolving policies and procedures. Since liquidity is often a challenge for fast-growing companies, solid cash flow reporting is crucial. Automation features and seamless integration with existing systems become increasingly important to keep pace with business activity. Three solid choices are:

• Xero: Xero’s AR software, part of its accounting software, is available in a tiered approach whose pricing options are based on the features selected, such as multiple currencies, inventory, and payroll services. The higher-tiered plans deliver scalability that the entry-level plan, which limits the number of invoices, does not. Two plan-level upgrades are necessary to receive advanced cash flow projections with analytics. Pricing is affordable, but customer support is primarily email-based.
• Invoiced: Invoiced specializes in AR automation, which is ideal for fast-growing companies looking for scalable, streamlined invoicing, payment reminders, recurring billing, online payment, and cash application features. It also handles more complex billing scenarios, including subscriptions. Pricing varies significantly based on features, so understanding cost takes some investigation. Most significantly, Invoiced is a standalone AR solution that requires integration with a company’s established accounting software.
• NetSuite: NetSuite provides a highly scalable AR solution as part of its NetSuite ERP software. Comprehensive AR features, such as automated invoicing, payment management, and collection reminders, eliminate manual intervention, enabling efficient handling of increasing transaction volume. Role-based AR dashboards provide real-time insights to help management stay ahead of the curve. The cost of the annual licensing fee depends on the number of optional modules in the ERP system and the number of users.

Best AR Software for Startups

Startups juggle multiple priorities as they work to establish their young companies. When selecting AR software, cost is usually a primary concern. Quick implementation time and integration with popular financial and operational startup tools, such as point-of-sale and fulfillment, are other top considerations, as is flexibility to accommodate those inevitable business pivots. Three recommended choices of AR software for startups are:

• Wave: When cost is the primary concern, a free starter plan may be appealing. No monthly fees for basic invoicing and payment tracking, combined with intuitive user interfaces, make Wave a quick and inexpensive option for businesses just starting out. However, limited scalability and basic customer support may cause startups to outgrow this solution.
• Stripe Billing: Stripe has built a strong presence with startups, thanks to its payment processing foundation. Multiple plans offer room to grow, which avoids the need to transition when the business takes off. Stripe can handle more advanced billing scenarios, including recurring/subscription and usage-based pricing. And while Stripe isn’t a full accounting solution, it integrates easily with websites and apps and supports global payments. Pricing is volume-based, which is beneficial as a business gets going; then, it can convert to an annual subscription fee based on several volume tiers.
• NetSuite: NetSuite is best for startups that expect a rapid ramp-up and want a solution that will provide a strong foundation for growth. The cloud-based software keeps up-front IT costs and implementation time low, and makes adding other ERP modules, such as order management and inventory management, easier when they become necessary. A combination of prebuilt, customizable AR workflows and reporting tools helps get the AR process running effectively from the outset.

Best AR Software for Family-Owned Businesses

Family-owned businesses are as diverse as families themselves, ranging from candy behemoth Mars Inc. to a vineyard in New York to the local bakery on Main Street. Despite this diversity, most share common priorities when selecting AR software. Family-owned businesses typically prioritize value, seeking stable, long-term solutions while remaining price-sensitive. With typically lean organizations and limited in-house accounting and IT teams, they often rely heavily on the support and expertise of software vendors. They prefer straightforward, user-friendly systems that cover the basics well, allowing family members to focus on maintaining close relationships with customers and suppliers. Three popular choices are:

• FreshBooks: Family-run businesses with limited accounting expertise prefer FreshBooks because its intuitive dashboards make it easy to use. Invoicing is straightforward, yet allows for some customization. FreshBooks also provides customer contact features and integrates with many banks and payment gateways. Customer support is available via live chat, email, and phone during extended business hours. Pricing plans are based on the number of billable clients and the number of users, so scalability might be a challenge for large family businesses.
• Xero: Xero’s cloud-based solution can work well for family-operated businesses wanting an all-in-one solution for AR, accounting, payroll, and inventory tracking. Within the AR component, invoices can be customized to handle branding, specific products and payment terms, and automated payment reminders. Xero has a bank reconciliation function that streamlines the process of applying customer payments in a timely way. Xero offers several plans with varying price points. Family businesses with multiple entities, companies, or cost centers may require several instances of the software. Xero offers 24/7 email and chat support, but no direct phone support.
• NetSuite: NetSuite AR combines automated invoicing and payment management with a robust customer database that houses both customer communication history and transaction history, all of which helps family businesses provide the personal customer service they take pride in. Other features, such as automated cash application, sales tax calculations, and consolidated invoicing for repeat customers, eliminate manual tasks. As part of the larger NetSuite ERP suite, NetSuite AR is highly scalable and seamlessly integrates with other ERP modules as family-owned businesses grow or become more complex. Tiered pricing and support options let businesses choose what works best for their situation.

Best AR Software for Small Businesses

Small businesses require a balance between functionality and affordability. They’re looking for user-friendly solutions that cover the essential features, such as invoicing and payment tracking, without being overwhelming. Additionally, they often need basic reporting capabilities that integrate seamlessly with popular small business accounting platforms. Since cash flow challenges are common among small businesses, AR analytics tools that track overdue invoices and project future cash flow are particularly valuable.Small businesses also prefer systems that are somewhat scalable and can adapt along with business growth or changes in operations, without requiring a complete overhaul of financial processes. Three common choices are:

• Bill.com: Bill.com is a standalone AR solution meant to be added to a business’s existing accounting software and technology stack. It automates the AR process, which is particularly helpful for small businesses moving away from manual processes. Invoicing is done using quick, turnkey templates distributed through email or postal mail. The system handles automated follow-ups and basic reporting. Payments that are received through Bill.com automatically generate updated customer balances, reducing the number of transactions to be manually reconciled. There are four levels of pricing that increase with customization options, sign-ons, and location. Cash flow forecasting and phone customer support are available with upgraded plans.
• Zoho Books: This affordable AR solution offers automated invoicing, payment reminders, a customer portal, and payment links. It’s especially helpful for international businesses, as Zoho Books supports multiple languages, currencies, and sales tax calculations. The AR software integrates seamlessly with other Zoho apps. Three different plans offer progressively more features at escalating price points, such as additional customization and support for subscription and complex billing schemes. Most plans have 24/5 email and chat customer service, with phone support available for higher-tiered plans.
• NetSuite: A go-to for small businesses with simple to complex AR needs or aggressive growth plans, NetSuite has advanced tools for invoicing, collections management, and detailed customer reporting right out of the gate. It’s highly scalable, equipped to handle increased volume and complexity with ease. Since it’s cloud-based, the software is always current without the costs and hassles associated with managing on-premises technology. Basic support comes standard, with premium options available for businesses that need extra help.

Best AR Software for Midsize Businesses

Midsize businesses require more robust and scalable AR solutions, yet might not need the complexity of large-scale, enterprise-level systems. Their primary requirement is the ability to handle higher transaction volumes efficiently. Additionally, midsize businesses often require some advanced AR features, such as customizable invoicing and multicurrency support. With a larger staff contingent, sometimes spread across multiple geographic locations, midsize companies often look for AR software with multiuser access and role-based permissions to ensure better security. They also demand more sophisticated reporting capabilities, since these businesses generally offer multiple products or services and sell through multiple channels and locations. AR reporting and analysis tools are crucial at this level for examining sales and payment data across various dimensions. Three top choices are:

• BlueSnap: A comprehensive, quote-to-cash solution, BlueSnap features automated invoicing for multiple billing schemes, automated payment reminders, a branded customer self-service portal, and reporting. It provides a global payment gateway, making it ideal for businesses requiring international payment processing, and support for over 100 currencies. BlueSnap is meant to work with a company’s existing accounting software. While there are no setup fees, pricing is pay-as-you-go, based on a percentage and fixed fee per transaction, which can add up quickly.
• Versapay: This cloud-based AR solution focuses on simplifying the invoicing and payment process for large volumes of invoices—a common pain point for growing, midsize businesses with high transaction volumes. Invoices can be distributed by email, customer portal, accounts payable portal, electronic data interchange, or regular mail. The system accepts various payment methods that are automatically matched and applied to outstanding invoices. Its focus on improving cash flow through insightful reports and key performance indicators—along with reducing manual processes, such as dunning notices—makes it a good choice for midsize businesses. The AR software is designed to integrate with popular ERP systems and also offers an API to connect with others beyond those officially supported. Versapay pricing is typically provided upon consultation.
• NetSuite: NetSuite is a leading solution for midsize businesses, especially those needing scalable financial tools. It automates all the key steps in the AR process and is packed with sophisticated features, including consolidated invoices for customers with multiple entities, deferred revenue recognition, and payment predictions powered by artificial intelligence (AI). Because the comprehensive AR software seamlessly integrates with other modules in the NetSuite ERP suite, growing, midsize businesses can access a holistic view of their business in a single, unified solution. Real-time dashboards and analytics provide upgraded business intelligence to help managers take the business to the next level. And because it’s cloud-based, NetSuite keeps the cost and stress in line for a midsize IT team.

Best AR Software for Private Equity (PE) Backed Businesses

Private equity (PE) investors can be thought of as “company flippers.” They make their money by investing in an existing business and driving up operational efficiency to accelerate growth and boost overall company value. This means that AR systems must be scalable to handle the anticipated rapid influx of business volume and/or introduction of new business offerings. Robust, transparent, and real-time reporting and analytics are critical for tracking progress toward goals and for keeping investors updated. Additionally, since PE investors realize their investment returns by exiting, through a sale or public offering, AR software needs to have strong security features to protect sensitive financial data. Three common choices are:

• AccountsIQ: This cloud-based accounting platform is designed for multicompany groups, making it easy for PE investors to monitor their portfolio companies, using common formats and consolidation tools. Since AccountsIQ integrates with other common accounting and ERP systems, portfolio companies can continue to use their existing systems. In terms of AR functionality, AccountsIQ offers mid-level AR features in its basic plan, including digital invoicing, multicurrency support, and automated cash application, together with reporting analytics, at a competitive price. Additional features are available for an additional cost. Further, the software’s user profiling provides strong controls by limiting access to certain functions and reports. AccountsIQ is a U.K.-based company with a dedicated customer service team based out of Dublin, along with on-demand training resources through its AIQ Academy.
• Invoiced: This standalone AR automation solution covers all the standard features in the invoice-to-cash workflow: invoicing, payment reminders, and customer portals, with a focus on streamlining collections. PE firms often recommend Invoiced to their portfolio companies because it’s quick to implement and integrates well with other platforms, such as Xero and NetSuite, and can piggyback on their reporting and forecasting tools—a plus, since Invoiced doesn’t have its own. Monthly pricing plans span a wide range, depending on usage and the features required.
• NetSuite: NetSuite ERP is excellent for quick scaling and providing in-depth financial insights needed by PE-backed companies. The AR module has automation features that handle everything from invoice generation to payment processing and collections management. Real-time visibility into AR metrics enables businesses to monitor progress toward growth targets, which is crucial for PE reporting requirements. The software can easily manage increased transaction volumes and more complex billing scenarios as a business expands. Additionally, the ability to seamlessly add other ERP modules as needed is something PE firms appreciate when building value in their portfolio companies.

Best AR Software for Venture Capital (VC) Backed Businesses

Venture capital (VC) backed businesses tend to be early-stage companies in high-growth sectors. VC funds are typically used for scaling these businesses through rapid product expansion, customer acquisition, and market penetration. Therefore, their AR software needs to manage fast-growing transaction volumes without creating bottlenecks or sacrificing efficiency, typically through automation. VC-backed businesses need excellent reporting capabilities to track their progress against funding milestones, and to provide detailed updates to VC stakeholders. Integration of AR with advanced forecasting tools to predict future cash flow are particularly valuable, helping business leaders manage liquidity during periods of aggressive growth. VC-backed businesses typically need to balance the need for these advanced features with affordability, while operating within tight burn rate limits. AR software to consider includes:

• SoftLedger: SoftLedger offers real-time tracking of receivables and payment statuses, making it a solid choice for startups and other businesses that need fast and flexible reporting tools. It provides customizable, digital invoices, delivered via email, but its standard plan lacks multicurrency support, which can be a limitation for VC-backed companies with global goals. SoftLedger includes integrated bank and credit card feeds to streamline payment processing as part of its general ledger module. There are three plans to select from, with the standard plan being significantly more expensive than other popular options, which may be a barrier for startups with constrained capital.
• Bill.com: Bill.com’s entry-level plan has a low price point and basic automation of AR processes, making it a good option for scaling startups with VC backing. Digital invoicing, automated reminders, and multiple payment options, including Automated Clearing House (ACH) transfers and credit cards, help these businesses optimize cash flow management with less manual intervention. The platform’s integration with popular accounting software makes it an attractive choice for quick implementation. Upgrades are needed for more advanced features, such as cash flow forecasting.
• NetSuite: NetSuite provides the depth and breadth needed for advanced AR management, perfect for businesses using VC funds to grow quickly. NetSuite’s AR module is powerful and comprehensive, offering automation for invoicing, collections, and cash application. Its real-time analytics and insightful reporting tools deliver the financial visibility that VCs expect. And since most implementations take 45 days or less, it quickly puts a powerful system in place that can grow with the company.Plus, the cloud-based platform means companies aren’t tying up precious capital in IT infrastructure.

Best AR Software for Enterprise Businesses

Enterprise businesses require comprehensive AR solutions that can handle complex, large-scale operations. These systems must check all the boxes and meet critical needs—scalability, customization, integration, security, and advanced reporting. They also may need to support multiple currencies and languages and comply with complex global regulations. Enterprise businesses increasingly rely on advanced AR features, including AI-powered automation for some tasks, such as payment matching, credit risk management, and cash account reconciliations, in order to free up their teams for more strategic work.

Cloud-based AR software is particularly beneficial for enterprises with teams in different locations or with multiple subsidiaries. These businesses are likely to have other systems in place and need their AR software to connect to their existing tech stack, including CRM systems, inventory management platforms, and financial planning tools. Seamless integration is essential for keeping data flowing smoothly across the organization. Three of the best AR software options for enterprise businesses are:

• HighRadius: HighRadius specializes in AI-driven automation for enterprise AR processes, including invoice delivery, payment collection, dispute resolution, and cash application. Its suite covers the entire order-to-cash process, offering real-time insights and predictive analytics to improve efficiency throughout. Large enterprises particularly benefit from its automated workflows, cutting down on manual tasks significantly. HighRadius can also integrate with external ERP systems. Pricing requires a custom quote based on specific requirements.
• SAP S/4HANA: This powerful AR software was built specifically with large-scale enterprises in mind. SAP includes key AR features, such as real-time cash flow insights, automated invoice generation, and seamless integration with other SAP modules, as part of its S/4HANA ERP suite, making it highly scalable and ideal for complex, multinational operations. SAP delivers real-time data analytics and reporting, assisting with cash flow management and comprehensive financial visibility. Modular pricing is available, with costs varying based on features and deployment scale. On the downside, it’s common for implementation timeline and costs to exceed initial expectations. SAP offers dedicated customer service managers for large enterprises.
• NetSuite: NetSuite AR’s unified platform is ideal for large enterprises with complex AR needs, handling everything from invoices to payments and collections, with AI functionality embedded throughout. A few examples are smart payment forecasting, automated customer credit risk assessments, and intelligent invoice processing using optical character recognition and document object detection. NetSuite AR delivers detailed and customizable reporting, multicurrency support, and streamlined workflows. Its cloud-based design ensures accessibility and integration with other NetSuite ERP modules for comprehensive financial management. Pricing is subscription-based. Custom quotes are provided based on the size and scope of the deployment. Support options include a dedicated success manager for enterprise accounts.

Choosing the right AR software isn’t just about managing invoices and payments; it's about setting up your business for healthy growth and profitability. This critical decision directly impacts cash flow, operational efficiency, and overall financial health. The wide range of available options reflects the diverse needs of businesses of different sizes and at various stages of growth. From entrepreneurs and small businesses seeking simplicity and affordability to enterprise and investment-backed companies requiring scalability, integration, and advanced features, there’s no one-size-fits-all AR solution. The key is understanding where your business fits in this landscape and what features really matter for your particular situation. This guide helps narrow the field of options to ensure that you select AR software that meets current demands and scales in tandem with your business.

Best Accounts Receivable Software FAQ

How do you automate collections?

Payment automation can be implemented in all stages of the accounts receivable (AR) collections process. Tools, such as payment gateways, digital wallets, ACH, and customer portals, significantly streamline the capture and processing of customer payments. Additionally, advanced AR software automates critical tasks, including tracking overdue payments, performing timely customer outreach on unpaid invoices, and analyzing key AR metrics.

What is Net 45 payment?

Net 45 payment is one of several common payment terms businesses use when selling on credit. It means that the buyer agrees to pay the seller within 45 days of the invoice date. Net 45 payment terms are typically indicated on the face of a customer invoice.

What is a dunning letter?

A dunning letter is an important part of the accounts receivable (AR) process that reminds a customer of an overdue payment. These written notices start out friendly and escalate in tone and frequency if the payment remains unpaid. More advanced AR software automates dunning notices, letting companies set up customizable reminder schedules, appropriate messages, and desired delivery methods, such as email, customer portal notifications, and traditional mail.