Best Invoice Scanning Software in 2024: Complete Guide

Invoices are the lifeline of businesses.

But, scanning invoices and bills is time-consuming and often results in lost documents. With many manual tasks involved, many businesses lose money during this process.

Did you know three in five UK businesses are owed money from late payments, leading to stress and cash flow problems? This highlights the critical need for efficient invoice management.

There are many ways to digitize your invoices without manually scanning every page or sending them through the mail. Some software solutions even use artificial intelligence (AI), machine learning (ML), and optical character recognition (OCR) to help automate this part of your business.

In this article, we'll cover everything you need to know about invoice scanning, including what it is, its benefits, how it works, top invoice scanning solutions in 2024, and key features and types of documents handled.

Here's a quick overview of the top invoice scanning software in 2024:

What is invoice scanning?

Invoice scanning is the process of converting physical or digital invoices into structured, machine-readable data. This could be done using a traditional scanner for paper invoices, capturing digital photos of invoices with a smartphone, or manually entering the data into a computer system.

Invoice scanning software takes this process a step further. It uses optical character recognition (OCR) and machine learning to digitize invoices and extract and interpret data from them. This software can automatically identify critical information such as invoice numbers, dates, amounts, and vendor details.

How does invoice scanning software work?

The McKinsey Finance 2030 report reveals that top-performing finance teams spend nearly 20% more time on value-added activities than their peers. How? By leveraging technologies like invoice scanning software to automate routine tasks. 

Invoice scanning software typically follows these steps:

1. Document capture: The software ingests invoices in various formats – paper (via scanner), PDF, email attachments, or even photos captured on phones.
2. Data recognition: The software reads the document using built-in OCR technology, converting the image into machine-readable text.
3. Data extraction: The software identifies and extracts key information using a combination of OCR and machine learning algorithms. It knows exactly where to look for invoice numbers, dates, amounts, and vendor details.
4. Data validation: The extracted data is automatically checked for accuracy, flagging any discrepancies for human review.
5. Integration: The validated data is then seamlessly exported to your accounting or ERP system, ready for processing and payment.

But here's the best part: these systems become more intelligent with machine learning capabilities over time. They learn to handle even the trickiest invoice layouts with increasing accuracy, adapting to your specific business needs.

10 best invoice scanning software for businesses in 2024

As the demand for efficient financial processes grows, so does the market for invoice scanning software. The market is recognizing these benefits. The invoice automation market was valued at USD 2.26 billion in 2023 and is anticipated to expand to USD 5.66 billion by 2030, growing at a CAGR of 10.7%.

Let's examine some of the top solutions available in 2024:

1. Nanonets

Nanonets is an AI-based intelligent automation software that automates every aspect of invoice processes. The software is designed to integrate with your accounting software, like QuickBooks, Freshbooks, or Sage, allowing you to scan invoices from anywhere and send them directly into your accounting system.

Top features:

• Invoice ingestion: You can upload your invoices automatically from emails, drives, or desktops. No need to keep checking your emails for new invoices. Nanonets reduce the manual effort to upload invoices into the system with automated workflows.
• Invoice data extraction: Once the invoices are uploaded, the Nanonets OCR engine extracts the invoice data like invoice amount, tax amount, vendor information, line items, and more into a labeled format of your choice. Check it out.
• Accounts payable automation: You can automate every aspect of accounting processes like  multi-line table extraction, approvals, 3-way matching, status updates, and more with automated Accounting workflows.
• Expense management: Monitor all your business expenses with real-time expense reimbursement and data synchronization.
• Vendor management: Automate vendor onboarding, id verification, vendor payments, and more.
• Database syncing: Export all the extracted data from Nanonets to a system of your choice in real time. Nanonets integrates with 5000+ apps with API and Zapier.
• Custom formatting and post-processing: Apply custom formatting rules to standardize extracted data according to your business needs.

Here is a short demo of Invoice OCR on Nanonets

Pros:

• Easy to use
• Modern User Interface
• 95% OCR Accuracy
• Extract from various invoice layouts — no pre-defined templates
• Automate approval process with customizable workflows
• Easy accounting software integrations
• Create audit logs automatically
• Process invoices on autopilot
• GDPR and CCPA compliant
• Supports multiple languages and currencies
• Detect and flag duplicate or potentially fraudulent invoices
• 24x7 Support
• Transparent Pricing

Cons:

• Limited outcomes when used internally
• It takes some time to tag invoices and map the details.
• No mobile app

G2 Rating: 4.8/5

Pricing: Forever free and pay as you go plans available. Premium plan starts from $999/month.

2. Rossum

Rossum is an Intelligent Document Processing (IDP) solution that utilizes advanced AI technology for invoice scanning and data extraction. It's designed to automate significant portions of manual document processing work.

Key features:

• AI-driven data extraction with high accuracy
• Customizable user interface
• API for integration with existing systems
• Multi-language support
• Self-learning AI that improves over time

Pros:

• User-friendly interface
• Responsive customer support
• Flexible customization options
• Regular product updates and improvements

Cons:

• Learning curve for advanced customizations
• Processing issues with large PDF documents
• Line item extraction can be challenging

G2 Rating: 4.4/5

Pricing: Custom pricing based on volume.

3. BILL

BILL AP/AR (formerly BILL.com) is a cloud-based financial operations platform that automates accounts payable and accounts receivable processes. It streamlines invoice management, payment processing, and financial workflows to improve efficiency and visibility.

Key features:

• Automated invoice processing and payment
• Multi-level approval workflows
• Integration with major accounting software
• International payments support
• Vendor management tools
• Mobile app for on-the-go access

Pros:

• User-friendly interface
• Efficient invoice processing and payment system
• Strong integration capabilities with accounting software
• Robust approval workflows
• Paperless document management
• Multiple payment options (ACH, wire transfers, checks)
• Centralized dashboard for visibility

Cons:

• Syncing issues with some accounting software are common
• Customer support quality can be inconsistent
• Issues with invoice matching
• Mobile app functionality may differ from desktop version
• Pricing may be high for very small businesses
• Limited reporting capabilities

G2 Rating: 4.4/5

Pricing: Varies based on plan, with the basic plan starting at $45/user/month.

4. HyperScience

HyperScience is a cloud-based invoice automation platform that provides real-time data analysis, forecasting, and reporting.

Key features:

• Automatic payroll taxes calculation
• Automatic invoice generation
• Handles various content types, from structured forms to complex contracts
• Integration with enterprise systems and workflows
• Real-time data analysis and reporting
• Multi-language support
• GDPR and SOX compliant

Pros of using HyperScience:

• Drive revenue and business opportunities
• High accuracy in data extraction
• Efficient automation of manual tasks
• Handles unstructured data well (e.g., emails, reports, surveys)
• Adaptable to different document templates

Cons of using HyperScience:

• High infrastructure requirements
• Potential limitations on licensing
• Limited features
• May be complex to set up initially

G2 Rating: 4.6/5

Pricing: Custom pricing. Contact Hyperscience for a quote.

5. Laserfiche

Laserfiche is an enterprise content management (ECM) and business process automation platform that offers solutions for document management, including invoice scanning and processing.

Key features:

• Document capture and intelligent data extraction
• Customizable workflow automation
• Integration capabilities with core industry systems like Epic and Workday
• Records management and compliance tools
• Low-code application development options
• Cloud and on-premises deployment options

Pros:

• Ease of use, especially in document retrieval and form creation
• Strong capabilities in eliminating paper-based processes
• Effective in automating various business processes beyond just document management
• Robust security and compliance features
• Scalable for organizations of all sizes
• Customer support and community resources

Cos:

• A steep learning curve, especially for advanced features
• Occasional challenges with complex workflow setups
• The configuration interface could be modernized
• Difficulties with upgrades and maintenance

G2 Rating: 4.7/5

Pricing: The starter plan is priced at $50 USD /user/month.

6. Docsumo

DocSumo is an IDP solution designed for SMBs, lenders, insurers, and commercial real estate investors to automate their document processing requirements.

Key features:

• Data capture from forms, semi-structured, and unstructured financial documents
• Pre-trained API stack for loan application and insurance compliance documents
• Review & edit tool for easy data capture without manual entry
• Out-of-the-box API endpoint and CSV download option
• Multiple learning mechanisms to ensure maximum accuracy
• Customizable fields and template definition for recurring documents

Pros

• User-friendly interface
• Efficient data extraction, especially for invoices
• Strong customer support and onboarding process
• Customizable to specific business needs
• SOC-2 certified and GDPR compliant

Cons

• Limited database connection capabilities
• Functionality is tied to available credits,
• Occasional OCR accuracy issues with complex and large documents

G2 Rating: 4.7/5

Pricing: The basic plan starts at $500+ per month. Contact DocSumo for specific pricing.

7. Docparser

Docparser has a fully featured set of tools, including automated accounting, billing and reminders, email support, and more. Docparser is a great invoice processing software for small businesses that want to quickly create invoices without paying for an expensive professional template.

Key features:

• Custom parsing rules for precise data extraction
• Integration with popular tools like Zapier, Google Sheets, and Microsoft Power Automate
• Cloud-based processing for accessibility and scalability
• Routing functionality to direct documents to appropriate parsing rules
• Support for multiple document formats including PDF, Word, JPG, and PNG

Pros of using Docparser:

• Easy to use
• Helps identify new business opportunities
• Feature-rich data extraction software
• Multiple documentation
• Ability to parse documents multiple times

Cons of using Docparser:

• Does not implement two-factor authentication
• Only one user per account allowed
• Inconsistent formatting
• Learning curve for setting up complex parsing rules
• Slight changes in document format may require rule adjustments
• Pricing model with expiring credits can be challenging to manage
• Limited options for handwritten document recognition

G2 Rating: 4.6/5

Pricing: The starter plan is priced at $39/month for 100 documents.

8. Medius

Medius is a full-featured cloud-based invoice and document management software that provides real-time data analysis, forecasting, and reporting.

Key features:

• Automated invoice processing and approval workflows
• Integration with major ERP systems
• Real-time data analysis and reporting
• Multi-language support
• Modular solution suite including AP Automation, Procurement, Sourcing, and Contract Management

Pros of using Medius:

• ACH payments automation
• Easier Coding Mobile Capabilities
• Comment threads for each invoice
• User-friendly interface
• Efficient invoice processing and approval system
• Strong integration capabilities, especially with Microsoft Dynamics
• Mobile app for on-the-go approvals

Cons of using Medius:

• Advanced features may have a learning curve
• Some limitations in customization options — can't make changes to invoices already made
• Reporting functionality for multiple legal entities could be improved
• Occasional system bugs and glitches

G2 Rating: 4.4/5

Pricing: Custom pricing based on modules selected and business size. Contact Medius for a quote.

9. DocuWare

DocuWare is a document management and workflow automation platform that offers cloud and on-premises deployment options designed to streamline business processes, including invoice scanning and processing.

Key features:

• Document capture and data extraction capabilities
• Customizable workflow automation
• Web-based forms for data capture and process initiation
• Integration with major ERP and accounting systems
• Available in 17 languages, including Arabic, German, English, French, and more
• Mobile app for document access and approvals

Pros:

• Ease of use and user-friendly interface
• Effective in reducing paper-based processes and storage needs
• Strong capabilities in automating accounts payable workflows
• Robust search functionality for quick document retrieval
• Flexible deployment options (cloud or on-premises)

Cons:

• Limitations in document editing capabilities within the system
• Occasional challenges with setting up complex workflows
• Steep learning curve for advanced features

G2 Rating: 4.5/5

Pricing: Custom pricing based on organizational needs. Contact DocuWare for a quote.

10. Tungsten Automation

Tungsten Automation (formerly Kofax) has a cloud-based invoice scanning solution that offers fully integrated, feature-rich, scalable, and flexible software for managing the purchase order, invoice, and payment cycle.

Key features:

• Automated invoice capture and data extraction
• Integration with accounting and ERP systems
• Multi-channel input support (email, fax, mail)
• AI-powered learning mechanism for improved accuracy
• Customizable workflows and approval processes

Pros of using Kofax:

• Easy to find a text field and notate duplicates
• Can easily copy items or fields
• Processing scanned documents
• Adding typewriter text
• Easy compressing
• Efficiency

Cons of using Kofax:

• Hard to download/install
• Licensing and training costs can be high
• User interface can be challenging to navigate
• The support has a slow turnaround time

G2 Rating: 3.6/5

Pricing: Custom pricing based on business needs. Contact Tungsten for a quote.

Core functions and document support in invoice scanning tools

Your priority of invoice processing features should align with your business's requirements. For instance, multi-currency support may be vital for those with international vendors, while stringent industries may prioritize robust fraud detection and audit trails.

First, identify your current invoice processing pain points and the features that would best address them. However, there are certain core functionalities that are universally beneficial for most businesses and should be considered as a starting point:

Key features:

1. Optical Character Recognition (OCR): Advanced OCR technology is the backbone of effective invoice scanning software. It allows for accurate extraction of data from various document formats, minimizing manual input and errors.
2. Data capture and extraction: The software should be able to identify and extract key information such as invoice numbers, dates, amounts, and vendor details automatically.
3. Integration capabilities: Look for software that seamlessly integrates with your existing accounting systems, ERP platforms, and other financial tools.
4. Automated workflows: The ability to set up custom approval workflows can significantly streamline your accounts payable process.
5. Machine Learning and AI: These technologies enable the software to improve its accuracy over time and handle complex document layouts.
6. Multi-currency and multi-language support: Essential for businesses operating in multiple countries or dealing with international vendors.
7. Fraud detection: Advanced systems can flag potential duplicate invoices or unusual patterns that might indicate fraudulent activity.
8. Reporting and analytics: Comprehensive reporting tools provide insights into your AP processes and help identify areas for improvement.

Types of documents handled:

When selecting a scanner, ensure it can handle these essential financial documents:

• Invoices: Both paper and digital invoices in various formats (PDF, Word, Excel, etc.)
• Purchase Orders: To facilitate three-way matching and ensure accuracy
• Receipts: For expense management and reimbursement processes
• Bills: Including utility bills and other recurring expenses
• Credit Notes: To accurately track refunds and adjustments
• Packing Slips: For inventory management and order verification
• Contracts: To extract key terms and payment schedules

It's worth noting that the best invoice scanning software can handle both structured (standardized forms) and unstructured (varied layouts) documents. This flexibility is crucial as businesses often deal with invoices from multiple vendors, each with their unique format.

How to select the best invoice scanning software

The best invoice scanning software should meet your business needs and be user-friendly. It allows you to convert paper invoices into digital copies, saving time by enabling quick and efficient scanning.

With invoicing software, you can import and organize invoices by client or project, making it easy to track outstanding payments. This also simplifies recordkeeping in case of payment disputes.

We’ve compiled a quick checklist to help you evaluate different invoice scanning solutions:

1. Define your business needs

• Identify your business size (small, medium, large)
• List specific invoicing requirements

2. Evaluate software integration capabilities

• Check compatibility with your existing accounting software
• Assess integration with your ERP system (if applicable)
• Verify support for your preferred cloud storage solutions
• Ensure compatibility with both desktop and mobile devices

3. Consider cost factors

• Calculate your current invoicing costs (time, labor, errors)
• Determine your budget for software implementation
• Evaluate potential ROI from increased efficiency
• Compare monthly fees of the tools
• Check for hidden costs (training, support)
• Look for free trials or discounts

4. Compare key features

• Automated data extraction accuracy
• Customizable invoice templates
• Automated field recognition and naming
• Multi-page invoice handling
• PDF invoice import capability
• Audit trail creation
• Cloud storage options
• Secure and encrypted data entry
• Multi-language support (if needed)
• Approval workflow capabilities
• Reporting and analytics tools
• Compliance with relevant financial regulations

5. Assess security and compliance

• Verify data encryption standards (e.g., AES 256)
• Check for compliance with industry regulations (e.g., GDPR, HIPAA)
• Evaluate user access controls and permissions
• Confirm data backup and recovery procedures

6. Research user experience and support

• Read customer reviews and testimonials
• Check the software's ease of use and learning curve
• Availability of live help
• Quality of documentation
• Look for training resources and documentation

7. Test before committing

• Request a live demo of the software
• Take advantage of free trials when available
• Test the software with your own invoice samples
• Involve key team members in the evaluation process
• Check its ability to handle increased invoice volume and support for business growth

Systematically work your way through this checklist. It will help you choose an invoice scanning solution that aligns with your business needs, enhances efficiency, and provides long-term value.

Final thoughts

The typical processing time for an invoice is 14.6 days, and almost 40% of invoices tend to have errors. Invoice scanning software addresses these challenges by automating the process and reducing processing time and errors. 

It is a game-changer for companies looking to streamline their accounts payable processes. These tools offer significant time and cost savings by automating data entry, reducing errors, and integrating with existing systems.

When selecting a solution, consider your organization's specific needs, budget, and scalability requirements. Look for features like OCR, data extraction, and workflow automation, and ensure the software can handle all your essential financial documents. With the right invoice scanning tool in place, you'll be well on your way to transforming your invoice management process and boosting overall operational efficiency.

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