Xero raises your invoices, sends email reminders and reconciles payments, but it doesn't take money from your customers or chase beyond email. Payment apps collect the money, credit control apps chase it, and a few do both. The right choice depends on how your customers pay, how much chasing you do now and how many tools you're willing to run around Xero.
In this article
The short version
- Xero invoices, sends email reminders and reconciles, but doesn't collect money or chase beyond email
- Payment apps collect, credit control apps chase, and a few do both
- Payment apps post to Xero through a clearing account; gross payouts are simpler to reconcile
- If you add a chasing app, switch Xero's own reminders off yourself
- Adfin is an approved Xero payment partner that collects and chases in one app
What Xero does without an app
Before you add anything, it's worth knowing what you already have.
Xero raises and sends invoices, including repeating invoices on a schedule you choose. It can send automatic reminder emails when invoices are due or overdue, on a schedule you set for your organisation, and you can switch them off for individual customers or invoices. Bank feeds bring your transactions in, and bank rules and reconciliation suggestions help you match them. The aged receivables report shows who owes what and for how long, and each contact's history shows how quickly they usually pay.
Where your customers mostly pay on time by bank transfer, that may be all you need.
What Xero doesn't do is collect. Its pay now button only works once you connect a payment provider. Its reminders go by email only, and they aren't tailored to how each customer tends to pay. And nothing in Xero follows up a direct debit mandate your customer hasn't signed, or a direct debit that fails.
The main kinds of payment and credit control app
The payments and debtor management sections of the Xero App Store mix several quite different products. Most fall into one of four groups.
| Kind of app | What it does | What to check | Usual pricing |
|---|---|---|---|
| Collects and chases | Takes payment by several methods and follows up unpaid invoices | Which methods and chasing channels are included | Per transaction |
| Collects by direct debit | Holds mandates and collects on the due date | Card payments, chasing, fees on failed payments | Per transaction |
| Collects by card | Takes card and wallet payments from a pay now button | Direct debit support, chasing, fees taken from payouts | Per transaction |
| Chases only | Sends reminders and statements, sometimes adds late fees | You still need a provider to take the payment | Monthly subscription |
A fifth group, debt recovery services, picks up debts that chasing hasn't resolved. You'd usually bring one in for a handful of accounts, once your own chasing has run its course.
Collecting and chasing do different jobs. A reminder asks your customer to log in and pay, and it works if they act on it. A direct debit mandate takes the money on the due date whether or not they think about it. For regular fees and retainers, a live mandate usually leaves nothing to chase, so chasing is for the exceptions. For one-off invoices, a payment link your customer can pay by card or bank in a couple of taps is often what gets them settled.
You can end up running one of each: a direct debit provider, a card provider and a chasing app. It works, but it means three sets of fees, three logins, and payments arriving in different shapes to reconcile.
How an app works alongside Xero
A payment app connects to Xero as a payment service, so a pay now option appears on the invoices you send. When your customer pays, the app records the payment against the invoice in Xero, usually through a clearing account, and each payout to your bank is recorded as a transfer from that account. You then match the transfer against the line in your bank feed.
How much work that leaves depends on how the app pays you. If it deducts its fees before paying out, the transfer is a net lump sum and the fees need posting separately. If it pays out gross and invoices its fee separately, each transfer equals the payments behind it.
Chasing apps read your invoices and contacts from Xero and send their own reminders. They generally can't switch off Xero's reminders for you, so if you add a chasing app, turn Xero's own reminders off yourself, or your customers can get two sets of emails about the same invoice. The same goes for invoice emails: if an app sends the invoice for you, approve it in Xero without emailing it.
How to choose, and where Adfin fits
Work through these in order, because the early ones rule options out fastest.
- Does it collect money, or only ask for it? Look for the methods it takes. A listing that talks about getting paid without naming direct debit, card or bank transfer probably chases rather than collects.
- If it collects by direct debit, is it UK Bacs Direct Debit? Some apps listed on the store may be built for other countries' schemes.
- Can one customer pay one invoice by more than one method?
- Does the money arrive in full, and how quickly?
- What happens when a direct debit fails, and does a failed attempt cost you?
- Who chases, by which channels, and from whose email address?
- If you're moving from another provider, do your customers have to sign new mandates?
Adfin is an approved Xero payment partner, listed under payments and debtor management, and it does both jobs in one app. It picks up the invoices you approve in Xero, or only those on the branding themes you choose, and adds a payment link to the invoice. Customers with a mandate are collected by direct debit on the due date, and anyone else can pay by card, Apple Pay, Google Pay, pay by bank or bank transfer. Payments post back to Xero against the invoice, and payouts arrive in full every weekday with the fee invoiced separately.
On chasing, Adfin's Customer Agents send reminders by email, SMS or WhatsApp from your own email domain, on a schedule you set and within rules you approve. They can follow up unsigned mandates, retry a failed direct debit at no cost, then offer the customer a different way to pay, add statutory late payment fees to overdue business invoices, and offer instalment plans. Each successful payment costs 1% + 20p, with the percentage capped at £4 on direct debit and bank payments (direct debits over £2,000 carry an extra 0.3%), and failed payments cost nothing. With 10 or more mandates at another provider, Adfin moves them across through the Bacs bulk change process without your customers re-signing.
Common questions
Does Xero collect payments itself? No. Xero shows a pay now option and records the payment, but a connected provider such as Adfin, Stripe or GoCardless takes the money.
Are Xero's built-in reminders enough? They can be if most customers pay on time. They go by email only, on one schedule for your organisation, and don't follow up unsigned mandates or failed direct debits.
What's the difference between a payment app and a credit control app? A payment app collects the money, by direct debit, card or bank. A credit control app chases customers to pay but doesn't take the payment itself.
Will a chasing app stop Xero sending its own reminders? No. Switch Xero's reminders off yourself, for the organisation or for the customers the app handles, so customers don't get both.
How do payments from an app show up in Xero? Most apps record payments against the invoice through a clearing account and record each payout as a transfer to your bank account.
Do I need both a payment app and a credit control app? Only if your payment app doesn't chase. An app that collects and chases in one place, such as Adfin, saves running and reconciling two.
Sources
- Xero - Invoice payments: give your customers more ways to pay (accurate as of October 2026) https://www.xero.com/uk/campaign/invoice-payments/
- Xero - Invoicing software (accurate as of October 2026) https://www.xero.com/uk/features-and-tools/accounting-software/invoicing/
- Xero App Store - Adfin (accurate as of October 2026) https://apps.xero.com/uk/app/adfin
- Adfin Help Centre - Connect your Xero account to Adfin (accurate as of October 2026) https://support.adfin.com/en/articles/10199659-connect-your-xero-account-to-adfin
- Adfin - Pricing (accurate as of October 2026) https://www.adfin.com/pricing
