Cloud Accounting

Getting Paid Online: Zoho Books Tops Them All

Written by Greg Lam

Nowadays it’s basically a given that your online accounting software will have payment processing capabilities, whether natively or via an add-on. So, it’s relatively easy to send an online invoice to a customer and get paid. However, there’s a lot more to getting paid than having a payment link on your online invoice. At this moment in time, out of the micro-business and small business online accounting software that I’ve reviewed, Zoho Books offers the greatest amount of flexibility when it comes to getting paid.

In what ways, you ask? In all of the following:

  • Variety of payment processors
  • Multiple choices for ACH/eCheck payments
  • Deep integrations with Stripe and Square
  • Saving credit card and bank account information
  • Issue invoice and process payments on a recurring basis
  • Automatic emailing and notifications
  • Customer portal

While this article is focused on the payments functionality of Zoho Books, I will point out when competitors have comparable options.

Variety of Payment Processors

Zoho Books supports the following payment processors:

How does this compare to its competitors?

  • Xero:, DPS, eWay, GoCardless, PayPal, Stripe, Custom Payment URL
  • FreshBooks: Payments by FreshBooks, PayPal (credit card and eCheck)/PayPal Payflow Pro, Stripe,, Braintree, eWay
  • GoDaddy: PayPal, Stripe, Dwolla
  • QuickBooks Online: QuickBooks Payments (credit card and ACH) and Bitcoin
  • Wave: Payments by Wave (U.S.) and Stripe (Canada)
  • Kashoo: None

Xero and FreshBooks come close to offering the same amount of variety, but it’s the additional options that Zoho Books provides that makes it more flexible (as you’ll learn in this article). With Zoho Books, you’re allowed to choose which payment processors to use on invoices, so you can allow only Stripe and Braintree payments on one invoice while only PayPal on another.

In general, I’d rather use a system that simply works, instead of having a bunch of options that confuse things. But the point about accepting payments is that there are so many variables that need to be accounted for, including payment method (credit card, bank, PayPal), discount rate, integration with other systems, and ability to bill on a recurring basis.

Multiple Choices for ACH/eCheck Payments

The thing that gets me about accepting payments online is that most companies can only handle credit card payments, which means you have to deal with the accompanying discount fees – which take roughly 3% of the invoice amount. For some businesses this is perfectly acceptable, but for businesses that deal with large invoice amounts, this can be a huge cost. With Zoho Books, there are multiple ways to get paid via a customer’s bank account, whether through ACH or eCheck:

  • Forte: Only $0.25 per transactions (but you do need to pay Forte’s $24.95 monthly fee).
  • PayPal’s Business Payments: Allows customers to fund the purchase using their bank account or PayPal balance. You pay $0.50 per transaction, which is more expensive than Forte, but you don’t need to pay a monthly PayPal fee. In my PayPal tests, the payments come through as echecks, so this means it can take about a week to process, as opposed to the faster turnaround time with credit cards (instant).
  • eCheck: The rates aren’t very transparent, but provides a rate list. They state that it’s $0.35 per transaction plus a percentage of the transaction value (which ranges from 0.55% to 0.75%).

I would be remiss if I didn’t point out that QuickBooks Online (when QuickBooks Payments is used) offers ACH payments, FreshBooks allows PayPal Business Payments, and GoDaddy can accept bank payments through its integration with Dwolla.

Deep Integrations With Stripe and Square

Most payment processor integrations found in online accounting software are basic, in that they add an option to pay via credit card or bank account. They don’t often accounts for things like fees, refunds, and batch deposits. Zoho Books, however, has made deeper integrations with a couple of payment processors to make the process more automated.

Both the Stripe and Square integrations are fairly similar in nature, in that they account for payments, deposits, fees, refunds, and tax codes. We actually have a complete article about the integration with Stripe, which details how it’s implemented. No other software handles Stripe payments in this deep a fashion.

The Square integration isn’t so unique, as Zoho Books’ main competitors in the small business category (Xero and QBO) have released deep integrations as well. (Note: In July 2015, QBO released a much improved version of their integration with Square.) Each company has their own flavor of implementation but they roughly do the same thing. To avoid confusion, Square cannot actually be used as a payment processor on invoices sent out from the respective online accounting software – instead, it’s the online accounting software that’s able to pull in invoices issued through Square.

I should note that while Zoho Books does a good job with the Stripe integration, I feel that the QuickBooks Online/QuickBooks Payment integration is the smoothest for automating payments, deposits, fees, and refunds so that reconciliation is as painless as can be. Wave does a decent job with their Payments by Wave integration, but there are still issues (like its inability to accept ACH payments and its manual reconciliation of payments) that mean Wave does not quite match up to the QuickBooks Online solution.

Saving Credit Card and Bank Account Information

A problem for many businesses is that they have regular customers who they need to charge on a regular (or irregular) basis but it’s a hassle for both the customer and the business to exchange payment details every time a new invoice is issued. With Zoho Books, a business can save credit card or bank account information to a contact’s profile. This can then be used for auto-charging the contact for recurring invoices (which I’ll discuss later on) as well as for applying payments to single invoices. What you can’t do is use the saved credit card or bank account information to pay multiple invoices at a time (although I’m told this is in the works).

Saving credit cards isn’t exactly unique to Zoho Books, as this feature is present in FreshBooks, QBO, and Wave. And Xero can do this through add-on providers. However, the way it’s handled by each system varies.

  • QuickBooks Online: Can save credit cards and use them on one-off invoices, to pay multiple invoices, and as part of recurring invoicing (although recurring requires the customer to fill out a written authorization form – digital approval is not possible). The non-recurring invoicing options are very flexible and easy to use. QuickBooks Payments credit card rates aren’t exactly the best, though (3.4% + $0.25 for pay-as-you-go or 3.1% + $0.25 for the $19.95/month plan). Bank account information (for ACH payments) cannot be saved.
  • FreshBooks: Credit cards can be saved (if entered by the customer) and if they’re part of the auto-billing feature (i.e., recurring billing). You cannot use a saved credit card to process payments yourself.
  • Wave: Can save credit cards, but it cannot be automatically charged on recurring invoices. You need to process payment manually on each invoice (manual as in you have to approve charging the card each time – you don’t have to re-enter credit card details).
  • Xero: You can’t save credit card information within Xero, instead you must do auto-charging via add-on providers.

Zoho Books is the only online accounting software that allows the saving of bank account information and it is the software that offers the largest variety of payment processors (, Stripe, PayPal Payflow Pro and Payments Pro, Forte, and Worldpay) that let you save credit card information.

On a technical note, Zoho Books does not actually store the credit card/bank information, but instead creates tokens with the payment processors that they can then repeatedly use. The advantage of this is that even if you use Zoho Books to save a credit in a payment processor, you don’t need to use Zoho Books to issue an invoice. You’re not locked in to Zoho Books as your invoicing or accounting system, and are free to move to another software system without the need to re-authorize the payment information of all your customers.

About the author

Greg Lam

Greg Lam is a passionate small business guy who loves technology and automation. He holds a BBA from Simon Fraser University, Canada. He's a Certified QuickBooks ProAdvisor, Certified Xero Partner, and Kashoo MVP. His business interests are focused on online accounting and how it can be used to streamline and automate a company’s accounting processes. He currently lives in Tokyo, Japan.

Greg operates the Small Biz Doer website, an "Entrepreneur's Guide to Small Biz Bookkeeping." He is the author of Online Accounting Software: Finding the Right Match, published by The Sleeter Group.

Connect with Greg on Twitter, Google Plus, YouTube, LinkedIn, or Facebook.


  • Hi there.

    Interesting you talked about these systems. They work fairly well with an American bases processor, but have you any evidence of zoho working with a Japanese paypal business account?

    Kind regards

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