Melio Taps Xero to Help Small Businesses Save Time on Bookkeeping and Bill Pay

Melio and Xero say they’ve teamed up to help small businesses spend less time on bookkeeping.

A new integration between the firms lets small business customers who use Melio’s payments platform automatically sync their accounts payable (AP) and accounts receivable (AR) data with Xero’s accounting software, the companies said in a Tuesday (Jan. 24) news release. 

“This two-way sync with Xero will help small business customers better understand how much money is going in and out of their accounts at a time when it is critical to keep a close eye on cash flow,” said Ilan Atias, Melio’s co-founder and Chief Technology Officer. 

“Moreover, this integration will help save customers time and simplify the bill-paying process while providing them with more visibility and control over their day-to-day finances.”

According to the release, the integration will help businesses cut back on their time on bookkeeping, as their bills, payments, and invoice information are automatically synced between the two platforms.

The Melio/Xero partnership is happening as small-to-medium-sized businesses (SMBs) look for simplified payment technologies to grow, as PYMNTs wrote earlier this month. 

Tapping The Payments Opportunity In SMB Retail, a PYMNTS and American Express collaboration, found that six in 10 SMBs were investing in new tools, including 20% adopting payment transaction systems.

Even before the pandemic and the recent record inflations, SMBs struggled to manage cash flow, Aharon Levine, head of payments at Melio, told PYMNTS in November.

He said part of the difficulties lie in the time and effort spent overseeing (AP) workflows and getting vendors paid.

“It’s hard to contemplate that a third of B2B payments are still done on paper checks,” he remarked to PYMNTS, and those checks equate to trillions of B2B spend annually.

B2B payments themselves are anything but simple, said Levine, who added that “there’s a lot that needs to happen before, during, and after the payment.” 

Workflows on the sender’s side involve approvals, preparation, collaborations, monitoring where the payments are, and ensuring that suppliers receive the funds.

On the supplier side, once the paper check is received and deposited, there are a number of taxation considerations, as well as reconciliation and communications between accountants and bookkeepers.

“All of this can take 10 business days — or 30% of the month,” Levine told PYMNTS, “and that’s a long time to wait for money.”