What is Xero and Why Do Nomads Use It?
Xero is a popular cloud-based accounting software designed for startups and small businesses. Its user-friendly interface makes it a favorite among location-independent entrepreneurs. With a Xero account, you can easily:
Send professional invoices and quotes.
Capture and organize bills.
Reconcile bank transactions automatically with bank feeds.
Get a quick snapshot of your cash flow and business health.
Handle multiple currencies (on higher-tier plans).
However, Xero is an accounting platform, not a dedicated AP automation system. While you can have suppliers email bills to a special Xero address for data capture, it lacks the advanced features needed to truly automate the entire process of paying your bills and contractors, especially on a global scale. For that, you need a specialized integration.
What is AP Automation (and Why Should You Care)?
In simple terms, AP automation software is a smart layer you add to Xero to handle everything related to your bills. Powered by AI and machine learning, it automates the repetitive, manual tasks involved in paying your expenses. When integrated with Xero, it can transform your workflow.
Key capabilities you can unlock:
Self-Service Onboarding: Your freelancers and contractors can onboard themselves through a simple portal, submitting their own payment details and tax forms (like the W-8BEN for non-US contractors working with a US LLC).
Automated Data Entry: The software uses Optical Character Recognition (OCR) to read invoices you forward via email or upload, automatically capturing all the details. No more manual typing.
One-Click Approvals: Set up rules to automatically route invoices for approval, which you can do with a single click from your phone or laptop, no matter where you are.
Effortless Global Payments: Pay your team in their local currencies without the hassle and high fees of manual wire transfers.
Automatic Reconciliation: Once payments are made, the system automatically updates and reconciles the transactions in Xero, keeping your books perfectly clean.
Real-Time Dashboards: Get a clear, visual overview of your spending, so you always know where your money is going.
Top 5 AP Automation Tools for Xero Users in 2025
Authored by Barbara Cook (Financial writer, former CFO, Deloitte audit experience, MBA from The University of Texas, active CPA license). Dated July 5, 2025.
1. Tipalti
Best for: Growing remote businesses with a global team of freelancers, affiliates, or contractors.
Tipalti is a powerhouse for finance automation, particularly known for its robust global mass payment capabilities. It’s more than just invoice processing; it’s a unified system designed to handle the entire payables lifecycle. If you're scaling a business that relies on paying numerous international partners, Tipalti is a top contender.
Global Payments: Pay to over 200 countries in 120+ currencies with 50 different payment methods, minimizing transfer fees and delays.
Contractor Onboarding: Features a self-service portal where your team can enter their details and tax info (W-9s for US, W-8s for international), ensuring compliance.
Advanced Automation: AI-driven invoice processing, automated approval workflows, and over 26,000 payment rules significantly reduce errors and manual work.
Multi-Entity Support: Seamlessly manage payables if you run multiple brands or companies under one roof.
Pricing: Starts at $129/month. This positions it for businesses that have moved beyond the solopreneur stage and are looking to build a scalable, efficient financial back-office.
2. Precoro
Best for: Small teams and businesses that want a straightforward, user-friendly AP and procurement tool.
Precoro offers a clean, direct integration with Xero focused on both AP automation and procurement. Its transparent pricing and ease of use make it an attractive option for those who want a simple yet effective solution without overwhelming features.
Key Features: Paperless invoice processing with OCR, 3-way matching for purchase orders, multi-currency support, and customizable approval workflows.
Budgeting Tools: Keep your spending in check with real-time budget controls and reporting.
Clear Audit Trail: Maintain a complete record of every transaction for easy tracking and financial reviews.
Pricing: $35 per user/month for teams up to 20, billed annually. This model is ideal for small but growing teams.
3. Pipefy
Best for: Tech-savvy nomads and businesses that want to customize and automate more than just AP.
Pipefy is not just an AP tool; it's a no-code Business Process Automation (BPA) platform. It offers a procure-to-pay template that integrates with Xero, but its true power lies in its flexibility. If you love building your own workflows and connecting different parts of your business, Pipefy is your playground.
No-Code Workflow Builder: Create custom processes for AP, client onboarding, project management, and more without writing a single line of code.
Flexible & Visual: Design processes that perfectly match how your business operates, using visual tools to orchestrate everything.
AI-Driven Insights: Use AI to analyze your processes and make smarter decisions.
Pricing: Offers a free Starter plan for basic task management. Paid plans start at $26 per user/month (billed annually), making it highly accessible.
4. ProSpend (formerly expensemanager)
Best for: Nomads and businesses with a strong connection to Australia and New Zealand.
As a leading spend management provider in the ANZ region, ProSpend offers a comprehensive platform to manage all company spending, from invoices to expenses. Its deep integration with Xero makes it a go-to choice for businesses operating down under.
All-in-One Spend Management: Consolidate invoices, expense claims, and card spending onto one platform.
Smart Automation: Uses AI, ML, and a unique "Human-in-the-Loop" service to ensure data accuracy and reduce fraud.
Compliance Focused: Features robust tools for monitoring compliance and setting approval limits.
Pricing: Available via custom quote, with implementation services offered separately.
5. Zoho Books
Best for: Entrepreneurs already using or considering the Zoho ecosystem.
Unlike the others, Zoho Books is a full-fledged accounting software that competes with Xero but includes AP automation features in its higher-tier plans. If you're looking for an all-in-one solution and appreciate the Zoho suite of products (CRM, Projects, etc.), this could be the simplest path to automation.
Built-In Vendor Portal: Included in the Premium plan and above, this portal allows your vendors to upload invoices, track payment status, and communicate directly.
Integrated Ecosystem: Seamlessly works with other Zoho apps, creating a powerful, unified business management system.
Affordable Tiers: AP automation features become available at a very competitive price point.
Pricing: The Premium plan, which includes the vendor portal, is $60/month per organization (billed annually). Higher tiers add more advanced features.
