Billing & Invoicing Software: How To Set Up Own Billing System


invoicing software

An automated billing system refers to a software solution that bills or invoices customers without significant manual intervention. The system works especially well in businesses that charge customers a recurring amount every month through a subscription or retainer model.

For example, a small wine store near me offers a monthly service where they’ll package three expertly chosen bottles of wine for $25. If they used an automated billing system, they wouldn’t have to worry about manually processing the recurring charge. Instead, their billing software would take care of it and notify them only if my card expired or was declined after multiple tries.

Consulting, law, and medical offices can also benefit from implementing an automated billing system, even if they don’t charge a uniform amount to clients and patients.

Automated billing systems operate either by invoicing customers and accepting payment or automatically charging customers with an on-file payment method.

You can find automated billing in standalone software solutions as part of invoicing software or included in accounting software. How you decide to set up an automated billing system depends on your company’s needs and the features available in your current software lineup.

 

Benefits of Billing Software

Automated billing can bring cash into your business faster while taking a big task off your plate.

More timely billing

The subscription model has gained so much popularity in part because it ensures a steady revenue stream. However, essential to the process is timely billing; when you bill customers inconsistently, you collect revenue inconsistently.

Automated billing software doesn’t have to juggle multiple jobs, unlike you do as a small business owner. Automated billing systems will bill your customers on time.

Time savings

It can take hours to send out business invoices, especially if you’re using a paper billing system. I’m sure you’d like back the hours you’ve spent printing bills, folding them, stuffing them in envelopes, and putting on stamps.

Automated billing systems generally operate digitally. Not only do they help your business to go paperless, but they also free up the last Sunday of every month that you dedicate to billing. Salesforce is one such automation system that will completely automate your billing system while also storing all the data on their Commerce Cloud platform for you to review later or keep a permanent tab of.

Further, automated billing software all have a “dunning” feature that retries declined cards and notifies customers of an expired or declined payment method, prompting them to update it. Without the automation, you’d be stuck having to collect valid payment information.

Error reduction

Manually charging customers inevitably leads to clerical errors. You can avoid human error by correctly setting up an automated billing system. Less human intervention leads to fewer billing errors that can seriously anger customers.

Billing Software Industries Specifics

To ensure mutual understanding between different BS of different operators (this, for example, is required for roaming), groups of billing standards have been developed. There are three main international groups of standards.

In 1998, the American Standards Institute ANSI approved the ANSI 124 standard. TIA is engaged in further improvement and support of ANSI 124. Subsequently, CIBERNET created a working group to define the ANSI 124 messaging business process specifications, which were called NSDP-B&S. These specifications establish a one-to-one correspondence between the business processes of telecommunications operators and the information transmitted during the exchange of data between switches according to the ANSI 124 standard.

In 1998, the description of the first North American CIBER billing standard was published, which is currently maintained by CIBERNET and its CAC-IS committee. This committee brings together developers of billing systems and telecommunications operators. The main scope of CIBER is cellular networks of the AMPS standard.

The European (originally) TAP standard appeared in 1992. It is maintained by the TADIG working group. Most operators in Europe use TAP2, although there is a third version. Since 1995, the TAP2 modification, known as the TD.27 specification, or NAGTAP2, has also been used in the United States.

Steps to Create Own Billing System

The ideal automated billing system requires little to no attention after you set it up. Here’s how to get started with choosing and setting up a new automated billing system.

Research industry-specific billing software

Medical offices can’t use the same automated billing software as flower shops. If there are special considerations that you need to consider in the billing process — such as insurance payments — make sure you’re choosing an automated billing solution that can accommodate it.

Ensure integration with existing accounting software

Make sure your automated billing system integrates with your accounting software if it’s not already built-in.

Suppose your business uses the accrual accounting method. The billing system should automatically record journal entries that recognize revenue and accounts receivable when invoices go out and update your books again when customers make payment. Cash-basis businesses will recognize revenue only when customers pay.

Implementing a billing system that doesn’t communicate with your accounting software is just pushing your current billing workload onto bookkeeping.

Migrate customer payment data

Once you’ve selected the right billing software to meet your business’s needs, get working on importing your customers’ payment information to the new system.

Part of the accounting software integration should include seamless customer data migration.

Set up a customer payment portal

Nearly all automated billing systems include a customer-facing online portal that accepts online payments and lets customers download invoices and update their payment method.

Customize the payment portal with your company name and logo so customers know they’re logging on to the correct website to pay their bills.

Customize invoices

If you’re using billing software to create recurring invoices, customize them by adding your company name, logo, automatic payment information, and contact information. You don’t want to switch billing systems and leave your customers wondering whom they’re paying.

Review transactions regularly

If you’ve seen the movie I, Robot, you know not to leave everything up to robots. Regularly go into your billing system and test it for accuracy. Guarantee its accuracy by randomly selecting at least 10% of your monthly transactions, and then make sure they accurately reflect the amount each customer owes.

You also want to check that your billing software isn’t missing any customers. Generate an accounts receivable report from your accounting software and compare it to the list of customers billed in your billing software.

Conclusion

With the growing trend for a real-time economy and government enforcement of e-invoicing, billing software should be an essential part of your finance department.

Joining forces with a reliable outsourcing billing system development company like Ardas can give your project a jump start. With 15 years of hands-on experience in fintech full-cycle development and dozens of completed projects, our team knows how to design a billing system that your team will love. Contact us to discuss your billing software development project!

 


Apple Gazette Team
We are a team of writers passionate about entrepreneur lifestyle and innovation. We write about topics which you are sure to find useful. This includes everything from economics and finance topics, product and technology reviews, to in-depth how-to guides and much more.

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