Best Invoicing Software for Small Business

The best invoicing software should make it easier for you to accept payments. It should also be easy to learn. Let's see the top 7 options you can try out.

Waiting to get your money in the bank can affect your cash flow. And invoicing is even riskier since some clients don't end up paying.

Managing invoicing manually or with unintegrated tools can double your work. As a small business owner, you don't have time for that.

That's why investing in a good billing software can make all the difference. Read on to find the best solution for your unique needs.

7 Best Invoicing Software for Small Business

A good invoicing software can streamline your process, reduce errors, and get you paid faster. Some are free, while some are paid but may have a specific feature you need. Check out our 7 top picks below.

1. FreshBooks: Best for Small Businesses

CREDIT FreshBooks

FreshBooks is an invoice and accounting software with essential payment management features. You can create professional invoices without sacrificing your branding.

It makes work efficient and is an affordable option. If you're a small business owner, you won't need to worry about breaking the bank.

You can even invite your accountant to FreshBooks. They can have up to 10 team members and help you update your journal entries, chart of accounts, etc.

Pricing:^[1]

• Lite: $17/mo; up to 5 billable clients
  
• Plus: $30/mo; up to 50 billable clients
  
• Premium: $55/mo; unlimited billable clients
  
• Select: custom pricing

If you need more features, these add-ons are available:

• More team members: $10/person/mo
  
• Advanced Payments: $20/mo
  
• Gusto Payroll: Talk to a specialist for a quote

Features:
FreshBooks lets you track your work hours, send and manage invoices, accept payments, and review accounting reports. It has everything you need to work with your clients online.

Here are other things you can do with FreshBooks:

• Use customizable invoice templates
  
• Send a thank-you email to your clients
  
• Request upfront deposits
  
• Collaborate on projects
  
• Track work hours using FreshBooks Chrome timer or app
  
• Accept online payments
  

FreshBooks has a scanner app you can use to take photos of your receipts. You can also import expenses from your bank account and assign them to clients.

Processing Fees:^[2]

If you're self-employed, then a free invoice software may be better for you. You can just pay for more features as needed. That way, you don't overspend on invoicing software.

You can do exactly that with Zoho Invoice.

2. Zoho Invoice: Best for Freelancers

Zoho Invoice is another invoicing software with features beyond invoicing. The best part? It's completely free. You only need to pay for add-ons you want.

Add-ons include Zoho Analytics, Zoho CRM, Zoho Sign, and Zoho Projects. They work well with invoicing and can make your workflow smoother.

If you're a freelancer or solopreneur, then you might not need the extras. You'll save on costs included with competitors' monthly fees.

Pricing:
Zoho Invoice is free to use^[3]. You only need to pay for add-ons if you need them. Some of these add-ons cost:

• Zoho Analytics (cloud platform): $24 to $455/mo billed annually^[4]
  
• Zoho CRM: $14 to $52/user/mo billed annually^[5]
  
• Zoho Sign: $0 to $22/user/mo billed annually^[6]
  
• Zoho Projects: $0 to $10/user/mo billed annually^[7]

Features:
Even without the add-ons, you can do many things with Zoho Invoice. You can send invoices through text and email. You can also send estimates with expiration dates.

Here's a list of the other things you can do:

• Customize professional invoices
  
• Accept online and offline payments
  
• Set automatic payment reminders
  
• Upload expense receipts and categorize them
  
• Assign user roles and permissions for team members
  
• Manage inventory
  
• Generate business reports
  
• Track work hours and send invoices from any device
  
• Choose from a library of templates
  
• Send statements for a breakdown

If you have regular clients, you can save their credit card information for recurring transactions. They can also use the customer portal to view their invoices and make payments.

Processing Fees:
Zoho Invoice doesn't have its own payment processor. But it works with multiple payment gateways such as Stripe, PayPal, and Square^[8]. You can shop around to accept online payments at your preferred rate.

If you're looking for another free invoice software, Square Invoices has a free plan. It could work well for any business that offers services online or in person.

3. Square Invoices: Best for Service Businesses

Square Invoices is a free invoicing software that works with all businesses. But it works best for running a salon, fitness gym, or any service establishment.

You can send invoices from the Square POS app. Or you could connect Square Hardware to the Square Invoice app to accept in-person payments.

If you want to offer special promos, you can use Square gift cards. Square can be an all-in-one platform for your business, and Square Invoices fits well with it.

Pricing:^[9]

• Free: $0/mo; comes with unlimited invoices, estimates, and contracts; unlimited users and customers

• Plus: $20/mo; comes with extra features such as batch invoicing, multi-package estimates, and milestone-based payment schedules

Features:
Square Invoices doesn't sacrifice its features even with a free plan. You can send unlimited invoices and estimates. You can also accept payments online and in person.

If there are multiple payments for a single job, you can set up milestone-based payment schedules. It's a great way to manage cash flow.

Here's a list of the other things you can do with Square Invoices:

• Manage projects
  
• Store customer details in the Square Customer Directory
  
• Send SMS campaigns and personalized emails
  
• Integrate with accounting software
  
• Integrate with eCommerce providers
  
• Get an overview of your business
  
• Download CSV files for bookkeeping

Have bundles of items and services to offer? You can offer multi-package estimates to your customers. That way, you can promote your less popular items with your most popular ones.

Processing Fees:^[9]
Processing rates for both Square Free and Plus pricing plans are:

• Online card payment: 2.9% + 30¢
  
• In-person card payment: 2.6% + 10¢
  
• Online ACH payment: 1% with minimum fee of $1
  
• Afterpay: 6% + 30¢

A free option wouldn't have all the features you need if you're a large business. The next one on this list can help with that.

4. Invoicera: Best for Large and Established Businesses

Invoicera is packed with features that can help you manage your business globally. It might be too much for a small business. But it works great for a large, established company.

It can integrate with your legacy ERP or CRM systems. You can customize it according to your business workflow. If you're working with international clients, you can send invoices according to their preferred language and currency.

You can also host Invoicera on your own server^[11]. That way, you're in control of the security of your invoices. But Invoicera also has layers of security features such as 2-factor authentication, security questions, and saving the IP addresses of your staff.

Pricing:^[12]

• Starter: $19/mo; up to 100 active clients, 1 staff
  
• Business: $49/mo; up to 1,000 active clients, 10 staff
  
• Enterprise: $99/mo; up to 2,500 active clients, 20 staff
  
• Infinite: $149/mo; unlimited active clients, unlimited staff

Features:
Just like other invoicing software, you can take online and offline payments, track billable hours and generate reports. You can send and receive purchase orders that can be converted into invoices.

Also, you can manage your accounts receivable and accounts payable in one dashboard. That way, you can get an overview of your vendors and clients.

Here's a list of the other things you can do with Invoicera:

• Automate payment reminders and late fees
  
• Manage global clients
  
• Track currency loss
  
• Offer group discounts and group tax options
  
• Assign clients to staff members
  
• Set productivity benchmarks
  
• Generate business reports

Processing Fees:^[13]
Invoicera doesn't have in-house payment processing. But it can work with over 30 international payment gateways.

Some of these include 2checkout, Authorize.Net, Stripe, and PayPal. Be sure to check out their corresponding processing rates.

Speaking of PayPal, you can also use the app as an invoicing software. It's the best option if you're looking for something simple to use.

5. PayPal: Best for Simple Invoicing Features

PayPal is one of the most popular invoicing software and payment gateway. There's little to no learning curve so you can grasp the software right away.

The PayPal Business app makes it easier to manage your invoices on the go. Your clients from anywhere in the world can use it to pay you, and they won't even need a PayPal account.

But it can be really expensive due to transaction costs. It's best to ensure that the rates are within your business' effective rate.

Pricing and Processing Fees:^[14]
PayPal has no monthly or setup fees. You only need to pay transaction fees. It costs 3.49% + $0.49 per U.S. transaction.

It's a lot more expensive than its competitors' processing fees. But keep in mind that PayPal works internationally, and the fixed fees for commercial transactions vary per country.

Features:
PayPal has an invoice template you can use and customize. You can add your logo and company information. You can also create invoices from anywhere through the PayPal Business app.

Other features let you send estimates, accept online and in-person payments, and manage your clients. For accepting payments in person, you can check out PayPal's card reader - PayPal Zettle.

Although your customers don't need a PayPal account to pay your invoices, you can still review their transaction history. That way, you can get a better understanding of your market. You can also import contacts if you have them.

This next one on our list can also be expensive. But it's packed with accounting features its competitors don't have. So if you're looking for an all-in-one solution, this is the one.

6. QuickBooks Online: Best Accounting Features

QuickBooks Online isn't just an invoicing software. It's an accounting software with invoicing features. Aside from sending invoices and accepting payments, you can pay bills, manage contractors, and automate bookkeeping tasks.

It has a free invoice generator you can use if you don't need the extra features. But you'll need a QuickBooks Online account if you prefer a paid plan.

Given its nature, it has the best accounting features among the others on this list. You can even opt for a checking account or integrate payroll.

Pricing:^[15]

• Simple Start: $30/mo; comes with invoicing features; can connect up to 1 sales channel
  
• Essentials: $55/mo; comes with Simple Start features; can connect up to 3 sales channels, have up to 3 users
  
• Plus: $85/mo; comes with Essentials features; can connect any available sales channel, and have up to 5 users
  
• Advanced: $200/mo; comes with Plus features; can have up to 25 users and more features on analytics, expenses, and workflow automation

Features:
QuickBooks Online has customizable invoices where you can place your logo and colors. Add a button to them so your customers can pay online easily. If your project requires multiple payments, you can set up milestones.

You can also customize estimates before sending them to clients. Add discounts, SKUs, payment terms, etc. QuickBooks can automatically convert estimates into invoices once they're accepted by your clients.

Here's a list of what else you can do:

• Manage project profitability
  
• Generate business reports
  
• Manage inventory
  
• Manage tax deductions
  
• Manage contractors
  
• Organize and pay your bills
  
• Use the app and card reader to take in-person payments

When you take photos of receipts using the app, QuickBooks will match their information to your existing transactions. If you link your bank account, QuickBooks can import information on your expenses and categorize them based on your rules.

Processing Fees:^[16]
QuickBooks Payments is the payment processor for QuickBooks Online.

Their transaction rates are:

• ACH: 1%; maximum of $10 per transaction
  
• Invoiced: 2.9% + 25¢ per transaction
  
• Card reader: 2.4% + 25¢ per transaction
  
• Keyed: 3.4% + 25¢ per transaction

Next, let's talk about the option with lots of free features.

7. Invoice2go: Best for Free Features

Others on the list may have free invoice templates and invoice generators, but Invoice2go has more. You can get free templates for receipts, business plans, and purchase orders.

Their paid plans are also more affordable. And they all come with unlimited estimates, projects, clients, and team members - a huge plus! Upgrading will give you quite a bang for your buck.

However, the lower-tiered plans are more suited for businesses that send only a few invoices a month. To send unlimited invoices, you'll need a premium plan.

Pricing:^[17]

• Starter: $5.99/mo; send up to 2 invoices per month; comes with free bank transfers, link to your bank account, client communications, and ratings and reviews
  
• Professional: $9.99/mo; send up to 5 invoices per month; comes with Starter features, accounting software integration, advanced reporting, and marketplace integration
  
• Premium: $39.99/mo; send unlimited and recurring invoices; comes with Professional features and phone support

Features:
Invoice2go lets you customize invoices from a standard template. Then, you can send it through text, email, Facebook Messenger, or WhatsApp. You'll get notified when a client views your invoice.

Aside from sending invoices, here are other features you can get:

• Customize and send estimates
  
• Accept online and in-person payments
  
• Track billable hours
  
• Schedule appointments
  
• Integrate with over 3,000 applications
  
• Export data to a separate accounting software

Keeping your files in one place is also helpful when managing multiple projects. With Invoice2go, you can organize estimates, photos, notes, and contact information. And you can get an overview with detailed insights of the payments you receive each month.

Processing Fees:^[17]
For card payments, the transaction fees are:

• Starter: 3.5%
  
• Professional: 3%
  
• Premium: 2.9%

The transaction fee for PayPal payments is 2.9% + 30¢ for all plans.

How to Choose the Best Invoicing Software?

Invoicing software programs offer different solutions for managing your invoices. When shopping for the best one, here's a list of features you can consider:

• Invoice management.
  Most invoicing software offer customizable invoices. If you have regular clients, make sure you can create recurring invoices. And if you're a freelancer, it helps if the software lets you invoice unlimited clients.

• Payment management.
  A good invoicing software lets you accept online and offline payments. That way, you're not limiting your customers. To ensure they don't forget their dues, see if you can also set automated payment reminders.

• Expense management.
  As small business owners, you have payments to receive, but you also have bills to pay. A good invoicing solution should have billing features that ensure you make payments on time. Being able to view your accounts payable will also help with cash flow management.

• Mobile invoicing.
  Mobile apps let you manage invoices on the go. You can typically track work hours and mileage. Some apps let you categorize business trips. This helps you send accurate invoices and ensure you get paid right. Categorization also helps with tax time.

• Detailed reporting.
  A detailed report can help you get an overview of your business. You get to have a bird's-eye view of the money coming in and going out. You also see which projects are making the most profit and which need to be let go.

A free billing software (like Zoho, Square, Paypal, and Invoicera) typically has basic invoicing features. If that's the only thing you need, then there's no need for extra costs or add-ons.

But all-in-one solutions (like Zoho and Quickbooks) can do more work for you. Some software even let you manage customers and employees. It all depends on what your business needs.

Our Methodology

You could be someone who wants something simple and direct. Or you could prefer all-in-one options. So, we considered invoicing software that are good for one or the other.

We took note of their features and identified what type of business they're most suited for. For some options, it was about their best strengths.

We also considered those with free plans and trials. That way, you can test them out first before committing to a plan. The best invoicing software has to be affordable or at least worth its price.

Frequently Asked Questions

• What is the best software to create invoices? FreshBooks is the best software to create invoices. And you can get it at an affordable price. It's not only packed with invoicing features but accounting features as well. You can send unlimited estimates and invoices. It also works with multiple payment gateways to shop around for your effective transaction rate.

• Does Microsoft Office have an invoicing program? Microsoft Office lets you create invoices from templates^[18]. But it doesn't have extensive invoicing features like FreshBooks or Zoho Invoice. You'll find invoice and bid templates for Word and Excel from Microsoft's website. But some invoicing software also offer these templates.

• Is Excel or Word better for invoices? Creating invoices through Word is easy in terms of flexibility. You can customize the design according to your brand with less effort. And Excel is convenient in terms of calculation. You can include formulas to calculate costs automatically. But an invoicing software is better than both due to automated invoicing features.

The Bottom Line

The right invoicing software can lift so much work from your shoulders. You can automate invoicing, set late payment notifications, import receipt information, and so much more.

It can get costly with extra features you don't need. Comparing what your options offer can help you avoid those extras.

When looking for the best invoicing software, keep an eye on the core features, pricing, and processing fees.

References