6 Best Accounts Receivable Software for Small Businesses
No company wants to deal with overdue invoices, but it’s often an inevitable part of doing business.
Preventing overdue payments and skillfully handling clients who pay late is an accounts receivable task.
Although large corporations may hire an accounts receivable specialist, smaller businesses may not be able to justify the investment. Instead, they look to software to handle accounts receivable processes for a fraction of the cost.
In this post, we’ll cover the six best accounts receivable software to help small businesses reduce the number of days it takes to get paid.
Here’s What We’ll Cover:
FreshBooks is a cloud-based billing & invoicing software that also helps small business owners and freelancers automate accounts payable and receivable processes. They’re rated the number one accounts receivable software by a variety of review sites.
With FreshBooks, you can send beautiful invoices, track billable hours, and track when a customer has opened an invoice.
Once you send an invoice, FreshBooks automates the rest of the accounts receivable process. You can set the platform to send automatic late payment reminders at specified intervals and FreshBooks also allows you to customize the message for a personal touch.
FreshBooks offers a wide range of features, including:
- Secure, self-serve portal for clients
- Cloud-based so you can access anywhere with iOS or Android
- Automatically bill late fees
- Comprehensive financial reporting
- Ability to get paid in a variety of ways
- Integrations with a variety of other accounts receivable software for added capabilities
FreshBooks pricing starts at $15 a month for the lite plan, which gives you access to unlimited invoices for up to 5 clients. If you have up to 50 clients, the Plus plan is $25 a month. Additionally, the premium plan at $50 a month allows you to invoice an unlimited number of clients.
FreshBooks also offers a risk-free 30-day free trial.
CollBox is a popular accounts receivable software with raving user reviews. CollBox seamlessly integrates with your cloud-based accounting solution to identify client or customer accounts with past due invoices. You can then choose to allow them to take over the collection process for one or more outstanding invoices.
Getting their help is as easy as a click of a button. Once they start the work on an outstanding invoice, minimal time and effort are required on your part. They even adjust their approach based on how important the specific relationship is to you.
CollBox has two main products. One product starts at $250 per month and helps with recently past-due invoices. A team of accounts receivable experts helps you collect your recently past-due payments and you get to keep all of the profit.
The other product option helps with seriously past-due invoices. This product is virtually risk-free because CollBox only takes a percentage of the successfully collected invoices and requires no upfront fee. In other words, you only pay if they’re successful in collecting the invoices you were likely ready to write off. The percentage that they take starts at 25%.
Chaser, an accounts receivable automation software, maintains an impressive 4.9 star rating on Capterra. The software connects to accounting systems and makes chasing customers a simpler process. Chaser gives you the ability to automate payment reminders with personalized emails, and when necessary, they’ll escalate overdue payments to their collections services.
Chaser makes it easy to keep track of all customer communications so that you can get a better idea of their payment history. Additionally, take advantage of their interactive debtor reports to gain more insight into your customers’ payment behaviors for better planning.
Chaser’s pricing starts at $40, making it one of the most affordable solutions on our list. To take advantage of escalation solutions, you’ll need a standard plan which starts at $95 a month.
YayPay is a dedicated collections solution for B2B companies that accelerates payments and allows you to keep track of accounts receivable with comprehensive financial reporting.
YayPay leverages machine learning to make predictions regarding payment behavior to help with planning and cash forecasts. They report that the predictions are 94% accurate. They also offer an easy-to-grasp and dynamic accounts aging report to help you know who to follow up with
Using YayPay, you can automate routine tasks like sending emails to get paid faster with minimal effort.
Key YayPay features include:
- Connect ERP, CRM, and email data for an easier glance of your customers
- Secure portal for customers to pay.
- Collections communications
- Real-time tracking of days sales outstanding (DSO)
- Predictive algorithms powered by AI
- In-house collections team
YayPay doesn’t disclose pricing, so you’ll need to contact them for a quote.
BlueSnap is primarily an online payment solution that also allows you to streamline the entire accounts receivable process from quote to cash. Connect BlueSnap’s automation software to your accounting software, CRM, or ERP for added convenience.
The all-in-one accounts receivable automation software offers the following capabilities and features:
- Customer portal
- Integrated electronic payments
- Proposals and eSignatures
- Billing & subscription management
- Invoice creation and automation
Fundbox is a unique software compared to the rest of the solutions on this list. It’s an accounts receivable financing software, which allows you to apply for up to $150,000 worth of credit. Fundbox leverages machine learning to automate the approval and lending process, so once you connect your accounting software or bank account, you can get a credit decision and funding within one business day.
Keep in mind that accounts receivable financing isn’t the same as factoring, so Fundbox does not take over the collections process, which means you still get to receive 100% of the value of the invoices you collect.
Some caveats are that your business must have annual revenue over $100,000, and you must have been in business for 6+ months at the time of applying.
Fees are roughly 8.33% for 24-week terms and 18% for 52-week terms. However, this varies from customer to customer. To learn more, go to their pricing page.
What is Accounts Receivable Software?
Accounts receivable software offers an affordable solution for growing businesses to streamline and automate the accounts receivable workflow. Software can take care of tedious, manual processes such as invoicing and follow-up, while making it a lot easier to see all customer communications in one glance instead of searching through countless emails.
Solutions can come as a standalone option that focuses solely on specific accounts receivable processes or as a more comprehensive suite of accounting solutions. For example, FreshBooks offers accounts receivable plus inventory management, accounts payable, and much more.
Improve Cash Flow While Preserving Customer Relationships
A good accounts receivable workflow reduces the invoice-to-cash cycle, which improves cash flow. Cash flow problems are the number one reason small businesses fail. And according to the U.S. Small Business Administration, 48.8% of small businesses will fail within five years of opening.
Commonly, it’s not a problem of making sales, but cash flow timing. Not only do delinquent clients make it hard to predict cash flow, but chasing payments can take away a lot of time that business owners can otherwise use more productively.
Also, dealing with delinquent clients who ignore your reminders may frustrate many business owners to the point where they give up and write off the invoice. And often, late payments happen for a variety of reasons. A tactful accounts receivable approach helps businesses get paid fast while preserving the customer-to-client relationship.
Save on Labor Costs: An Affordable Alternative for Small Businesses
It’s common for large corporations to hire employees to handle accounts receivable solely, but smaller businesses may not yet have the means. Accounts receivable software is the perfect solution for businesses that realize the importance of an accounts receivable solution but don’t yet have the revenue to invest in an accounts receivable team or employee.
What to Look For in an Accounts Receivable Software
When shopping for accounts receivable software, consider the following features:
- Online invoicing and automated follow-up: Drafting emails and consistently following up with multiple clients is a tedious, time-consuming process. Most accounts receivable software can automate this for you while still allowing you to keep a personal touch.
- Multiple online payment options: Allowing multiple payment options reduces friction, leads to faster payments, and improves the payment experience for customers and clients
- Customizable invoices: Invoices with clear payment terms improve the chance of getting paid on time
- Mobile-friendly: Mobile apps make it easier for customers to pay on the go
- Comprehensive dashboards and reports: Makes it easier to predict cash flow, plan follow-ups, and make strategic business decisions.
- Collection services: Most accounts receivable software companies either have their own team of collections specialists or integrates seamlessly with a dedicated collections software
- Integrations: The right accounts receivable software should integrate with your accounting solution and a variety of other software.
Accelerate the Invoice-to-Cash Cycle
Every client pays on time in a perfect world, and you don’t need to stress about accounts receivable. However, this can't ever be guaranteed. Accounts receivable software that you can rely on is a gamechanger for businesses that struggle with cash flow due to late payments.
Try one or more solutions on this list and experience the power of accounts receivable for yourself.
Try FreshBooks for free. No credit card is required.
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