Xero invoice payment apps compared

What a Xero payment app does

Xero does not take the payment itself. A Xero payment app connects a payment provider to your account so every invoice you send can carry a pay-now link or button. The customer clicks it, pays by their chosen method, and the payment flows back into Xero so it reconciles against the right invoice. In practice it turns an invoice from a request into something payable in a couple of taps, which is the single biggest lever on how fast you get paid.

Why the right app matters: getting paid faster

Late payment is a persistent drag on UK small businesses, and most of it comes down to friction. A manual bank transfer means the customer has to leave the invoice, log into their banking, copy your details and type a reference, and it often arrives without a clear reference for you to match.

A pay-now link removes that friction, and the method you offer changes both your fee and how quickly the cash lands. That is why it is worth comparing apps properly rather than defaulting to the first one Xero suggests.

What to compare

• Fees, and whether pricing is published. A percentage plus a fixed fee, and any monthly or chargeback fees underneath.
• Payment method. Card, Direct Debit or Pay by Bank, each with different cost, speed and customer experience.
• Settlement speed. From seconds (Pay by Bank) to a few working days (Direct Debit).
• Chargebacks. Card and some wallet payments can be charged back; Pay by Bank cannot.
• Reconciliation. Whether the payment carries the invoice reference and matches cleanly in Xero.
• Contract and lock-in. Most are pay-as-you-go, but check.

The Xero payment apps compared

Fees are indicative UK figures, as of July 2026. Confirm each provider’s live pricing before you decide.

The apps in detail

Atoa and open-banking Pay by Bank (lowest fees, instant)

Open-banking apps add Pay by Bank to your invoices: the customer approves the payment in their own banking app, and the money moves straight to your account. Atoa takes Pay by Bank from 0.6% + VAT and cards from 1.3%, settles Pay by Bank in seconds, and carries no chargebacks on bank payments. Because the payment can carry the invoice reference, it also reconciles cleanly. It suits one-off invoices of any size where you want the lowest fee and the fastest cash, while still offering card for customers who prefer it.

Stripe

Stripe is Xero’s built-in card integration and the most established pay-now option. It puts a “Pay now” button on every invoice and accepts credit and debit cards plus Apple Pay and Google Pay, with automatic reconciliation in Xero. UK consumer card fees start from around 1.5% + 20p, rising for EU and international cards. It suits businesses whose customers expect to pay by card, and whose margins can absorb card fees. Card payments can be charged back.

GoCardless

GoCardless handles Direct Debit rather than cards, with fees from 1% + 20p per domestic transaction, capped at £4. It is the natural fit for retainers, subscriptions and any regular billing, because once a customer sets up a mandate you can collect automatically on each due date. The trade-offs: the customer has to set up a mandate first, payments take a few working days to clear, and Direct Debit can be reversed through an indemnity claim. Less suited to one-off project invoices where you want paying today.

PayPal

PayPal can be offered on Xero invoices and benefits from strong buyer recognition, but at around 2.9% + 30p per transaction it is usually the most expensive option on this list. It can make sense where customers specifically want to pay with a PayPal balance, but on fees alone it rarely wins.

Card vs Pay by Bank vs Direct Debit

The method matters as much as the brand:

• Card is familiar and instant to the customer, but it is the highest-fee option and can be charged back.
• Direct Debit is ideal for scheduled, recurring amounts, but needs a mandate and clears over days.
• Pay by Bank is usually the lowest-fee and fastest to settle, with no chargebacks, and is well suited to one-off and ad-hoc invoices. For the recurring version, see Pay by Bank vs Direct Debit for Xero users.

Which app suits which business

• Freelancers and one-off invoices: a Pay by Bank and card app like Atoa gets you paid fastest at the lowest fee.
• Professional services with retainers: pair Direct Debit (GoCardless) for the recurring clients with a Pay by Bank app for one-off work. Running the two together covers most firms well and keeps fees down.
• Card-heavy or consumer-facing: keep a card option (Stripe, or Atoa’s card) so nobody is turned away, and add Pay by Bank to lower the average fee.
• Higher-value invoices: Pay by Bank avoids a percentage fee ballooning on a large amount and removes chargeback risk.

How to choose the right Xero payment app

1. Match the method to your invoices (one-off vs recurring).
2. Compare the total fee on your typical invoice size, not just the headline rate.
3. Check settlement speed against your cash-flow needs.
4. Confirm it reconciles automatically in Xero.
5. Consider chargeback exposure and any contract.
6. Do not assume one app must do everything: many firms combine two.

How to connect a payment app to Xero

In Xero, open your invoice or payment settings, add a payment service, connect your provider account, and switch it on so new invoices carry the pay-now link. Our step-by-step guide walks through it, and Xero payment reconciliation shows how to keep matching clean. To add Atoa, see Atoa for Xero and current pricing, or read our wider guide to the best Xero payment integrations. You can also add pay-now links through invoice payments.

Frequently asked questions

What is the best payment app for Xero?

It depends on how you invoice. For the lowest fees and fastest settlement on one-off invoices, a Pay by Bank and card app like Atoa is a strong fit. For scheduled recurring billing, GoCardless Direct Debit is well suited. Many firms run both.

How do I add a pay-now button to Xero invoices?

Add a payment service in Xero’s invoice or payment settings, connect your provider account, and enable it. New invoices then carry a pay-now link.

Which Xero payment app has the lowest fees?

Pay by Bank is usually the lowest-cost method, at around 0.6% + VAT with Atoa, versus roughly 1.5% + 20p for cards and 2.9% + 30p for PayPal. Compare on your typical invoice size.

Does PayPal work with Xero?

Yes, PayPal can be offered on Xero invoices, but at around 2.9% + 30p it is usually the most expensive option.

GoCardless or Stripe for Xero?

GoCardless (Direct Debit) suits recurring and retainer billing; Stripe (cards) suits one-off card payments. They solve different jobs, and some businesses use both alongside a Pay by Bank app.

Can customers pay a Xero invoice by bank transfer?

Yes. With an open-banking app like Atoa, the pay-now link lets the customer approve a Pay by Bank payment in their banking app, which is faster and lower-fee than a manual bank transfer and reconciles cleanly.

Does Atoa work with Xero?

Yes. Atoa connects to Xero so invoices carry a pay-now link for Pay by Bank and card, and payments feed back for reconciliation.

Sources (external links; verify with dated screenshots before publishing)

• Stripe UK card fees (from 1.5% + 20p): Stripe pricing; Connect Stripe to Xero (Xero Central).
• GoCardless fees (1% + 20p, capped £4): GoCardless for Xero; About GoCardless (Xero Central).
• PayPal (~2.9% + 30p) and market overview: Mobile Transaction, invoice apps for UK small business.
• Xero invoice payments overview: Xero UK, invoice payments.
• Atoa: Pay by Bank from 0.6% + VAT; card from 1.3% (reconcile vs 1.25% on the live Pay by Card page): Atoa pricing.