Four Best OCR Software for Invoice Processing in 2024

Imagine that you have a growing business. Your finance team may deal with various transactions from different entities, requiring you to upscale your accounts payable workflow with automated invoice processing tools that use optical character recognition (OCR).

Multiple companies have adapted OCR technology to their accounts payable processes to decrease the need for manual data entry.

In this guide, we’ll review the four best OCR software you can integrate for processing invoices. We’ll also discuss the basics of optical character recognition, how it works, and what factors you must consider when choosing the ideal invoice OCR software for your business.

Read on to learn more.

What is OCR Software and Its Role in Invoice Processing

Optical character recognition (OCR) software extracts data from scanned documents, PDFs, and camera images and converts them into searchable and editable text. In invoice processing, Users can integrate OCR software into the accounts payable workflow to extract invoice data faster and more accurately, eliminating manual data entry. Modern pre-accounting software also offers automated invoice processing, which uses artificial intelligence (AI), OCR, and machine learning (ML) for intelligent document processing.

How OCR Works in Invoice Processing

Optical character recognition is critical in streamlined invoice processing since it can automate processes like manual data entry. It transforms data from scanned invoices to machine-readable text. Here’s a detailed overview of how OCR works in invoice processing:

Step #1: Invoice Imaging and Upload

Paper invoices are captured and uploaded to the OCR invoice processing solution. You can also manually import digital invoices into the software.

Step #2: Data Capture via OCR

The OCR software will sharpen the scanned invoice to extract data more accurately, which can involve editing methods like noise removal, image enhancement, and more.

Once ready, the tool will use OCR technology to extract invoice information automatically. It singles out letters and numbers on the image and puts them into phrases, enabling you to access and extract key data from the scanned invoice (e.g., invoice number, date, vendor name, due date, line items, etc.)

Some advanced invoice processing tools integrate AI and machine learning to identify invoice formats, languages, handwriting, and critical information, such as early payment discounts, for cost savings.

Step #3: Data Validation and Manual Review

Modern OCR invoice processing tools let you create validation rules to ensure the accuracy of extracted data. Since the software has access to past captured invoice data, it can automatically detect discrepancies and issues like fraudulent invoices, allowing for faster and streamlined invoice approval.

Flagged invoices can be passed on to the accounts payable department for manual review, ensuring the extracted data is correct.

Step #4: Data Export and Archive

After the data is cross-checked and approved, it will be exported to an enterprise resource planning (ERP) system linked to your accounting system. Captured vendor invoices and extracted data are automatically archived for auditing purposes.

The Four Best Invoice OCR Software in 2024

Here are some of the best OCR invoice processing tools you can adapt this year to automate your AP process. We’ll go through their main features and pricing, helping you to make an informed decision on which OCR software fits your business best. To learn more, you can also read our list of the best invoice scanning software this year.

#1. Envoice

Envoice Main Features

Robust Invoice Extraction
Envoice can extract invoice data in seconds using SmartExtract, eliminating manual processes like data entry. It uses advanced technologies like self-learning AI, OCR, and machine learning for quick data capture. The platform also provides ExactExtract backed by Human-in-the-loop review for a fully accurate and hands-off experience in essential pre-accounting tasks, helping your team focus more on critical business processes.

Efficient Workflows and Approvals
Envoice simplifies your company’s approval process through a streamlined multi-level approval workflow tailored to your needs. It enhances transparency and accountability within your team by providing real-time status updates and a clear audit trail. This also allows for timely approvals on expense reports and reimbursements, making your accounts payable process more efficient.

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Streamlined Document Management
As an intelligent document processing solution, Envoice automates your document collection tasks by simply forwarding digital documents to your Envoice inbox for quick processing and storage. Your team can also use the Envoice mobile app to scan and submit receipts, effectively reducing clutter caused by paper documents.

Price

Envoice offers the following pricing tiers:

• Essential – The Essential plan costs $9/company monthly and is ideal for freelancers and small companies looking to automate invoice processing. It includes key features like quick data capture via SmartExtract, document collection, expense report creation, and integrations with accounting systems like Xero, QuickBooks Online, and Sage Accounting. Envoice also provides add-ons to fully automate data capture and invoicing tasks, like line item extraction ($0.2/line item), ExactExtract ($0.2/document), and invoicing ($0.15/document).
• Business – The Business plan starts at $18/company monthly and is suitable for growing businesses and enterprises. It offers everything from Essential, plus access to multi-approval workflows and the ability to create travel requests.

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Key Advantages of Using Envoice for Invoice Processing

Integrating Envoice into your accounts payable team provides the following benefits:

• Accurate Data Capture – Envoice’s SmartExtract allows you to extract key data from invoices accurately, eliminating data entry tasks. The platform provides ExactExtract and Human-in-the-loop review to ensure 99.9% accuracy in extracted data.
  
• Efficient Invoice Processing – Envoice helps your accounts payable team process invoices much faster using multi-stage workflows tailored to your company’s policies. It uses self-learning AI and machine learning to automatically approve recurring expenses and automatic delegation to ensure timely approvals.
• Automated Document Handling – Envoice provides a dedicated email address where suppliers can send invoices and business documents. It allows seamless data transfer from your preferred cloud storage provider, like Google Drive, OneDrive, and Dropbox. Employees can also submit their expenses digitally through the Envoice app for quick invoice scanning.

#2. Docparser

Docparser Main Features

Quick Data Extraction
Docparser helps you convert PDFs, Word, or scanned documents to readable data quickly without needing coding or technical skills. It offers predefined templates for extracting formatted data (e.g., invoice number, date, email address, purchase order number, etc.).

Custom Parsing Rules
Docparser allows you to create parsing rules directly tailored to your use case. This lets you get custom data from unstructured data sources (e.g., emails, text files, surveys, etc.).

Line Item Data Capture
Docparser allows you to extract line item data, such as repeating text patterns and tables from multiple documents. It can process files like PDFs, Word, and image files, eliminating the need for manual data entry.

Price

Docparser has the following pricing tiers:

• Starter – The Starter plan starts at $32.5 per month and is great for startups needing an automated data extraction service. It includes 1,200 parsing credits and the ability to create 15 different parsers.
• Professional – The Professional plan costs $61.5 per month and is ideal for small businesses. It offers everything from Starter, including 50 parsers, more parsing credits, and free parsing setup.
• Business – The Business plan starts at $133 per month and is recommended for companies needing to parse many documents. It includes everything from Professional, plus 12,000 parsing credits annually and priority support.
• Enterprise – The Enterprise plan is for large businesses with specific parsing requirements. It offers everything from Business, including custom annual parsing credits and unlimited parsers. Contact Docparser’s sales team to learn more.

#3. Docsumo

Docsumo Main Features

AI-Driven Data Extraction
Docsumo allows you to extract data from invoices or documents quickly and accurately, regardless of format.

Automatic Document Classification
Docsumo helps you seamlessly organize your documents into logical folders for quick retrieval and data capture. It uses artificial intelligence for large-scale document sorting across various file formats.

Powerful Reporting Tools
Docsumo provides tools to extract key insights from documents automatically by identifying patterns and trends. This allows your team to obtain essential data trends efficiently and lessen data entry errors.

Price

Docsumo offers these pricing tiers:

• Growth – The Growth plan starts at $500+ per month and is ideal for startups and small businesses. It includes three users and pre-trained APIs for purchase orders, paper or electronic invoices, and ID cards.
• Business – The Business plan is great for scaling companies. It includes everything from Growth, plus more users and the ability to extract data from bank statements, tax returns, and utility bills. Contact Docsumo’s sales team to learn more.
• Enterprise – The Enterprise plan is for large businesses implementing custom workflows. It offers everything from Business, including unlimited users and access to trainable machine learning models. To get a custom quote, contact Docsumo’s sales team.

#4. Nanonets

Nanonets Main Features

Intelligent Data Extraction
Nanonets uses OCR technology with AI and machine learning to accurately extract data from paper or digital invoices and other financial documents, making invoice processing more efficient.

Accounts Payable Automation
Nanonets provides various tools to help you automate accounts payable tasks, like invoice processing, supplier communication, approvals, and more.

Multi-Format Data Export
Nanonets supports various file formats when exporting data to your CRM or ERP software. You can also import files from popular cloud services like Google Drive, Dropbox, and One Drive.

Price

Nanonets offers these pricing plans:

• Starter – The Starter plan is for startups looking to try the platform’s core features. It follows a pay-as-you-go scheme, with 500 free pages and $0.3 per page. It contains three starter workflows and workflow integrations at $0.05/step run.
• Pro – The Pro plan starts at $999/month per workflow and is for businesses needing workflow automation tools. It includes everything from Starter, plus 10,000 pages monthly and $0.01/page, and the ability to add more team members.
• Enterprise – The Enterprise plan is ideal for large businesses. It includes everything from Pro, plus access to more add-ons like custom integrations, APIs, etc. Contact Nanonets’ sales team to get a custom quote.

How to Choose the Ideal OCR Invoice Processing Solution for Your Business

Here are a few important factors that you can consider when looking for an OCR invoice processing tool:

Speed and Accuracy

Choosing an OCR software that extracts data quickly and accurately is critical, even if the text is handwritten or in a language other than English. Ensure to pick a tool that uses technologies like AI and machine learning since they can handle volumes of documents as your business scales.

Note: Only a few invoice processing tools provide fully automated data extraction of your invoices and other documents. For a robust invoice capture and processing solution, try Envoice. We provide ExactExtract backed by Human-in-the-loop review, ensuring 99% accuracy of extracted data. Contact us today to streamline your data extraction process!

Customization

Choose an OCR invoice processing software that meets your company’s requirements, especially for document processing. Look for software that allows you to customize approvals, categorization, and file formats for data export.

Accessibility

It’s essential to choose an OCR tool with a user-friendly interface, easy to set up and requires minimal technical knowledge for quick onboarding. This lets you integrate the platform into your accounts payable workflows seamlessly and avoid delays.

Final Thoughts

OCR and AI are essential technologies for automating invoice processing. Finding the right OCR invoice processing solution is important to reduce delays, boost your business’s finances, and automate repetitive tasks like manual data entry.

If you’re looking for affordable and effective software for extracting data and automating AP workflows, consider Envoice. It has SmartExtract for accurate data extraction and supports multi-level workflows suited to your company’s needs.

Are you interested in streamlining your invoice approval process using Envoice? Contact us today to start integrating transparent and secure approval workflows in your business!