Accounts Receivable Automation in Australia: Debtor Follow-Up Inside Xero and MYOB

It is software taking over the routine steps of getting paid: sending invoices, reminding customers before and after the due date, matching money in the bank to the invoices it settles, and reporting who is overdue. Your credit controller still decides who gets more credit, how a dispute is settled and what is written off. In Australia this work is usually called debtor management.

Debtor management is how a business makes sure customers who buy on credit pay on time. It covers setting payment terms, checking new accounts before giving credit, sending invoices and statements, following up overdue accounts, recording promises to pay, and deciding when to stop supply or refer a debt to a collector. Automation handles the follow-up and record keeping; people handle the judgement.

A debtor is someone who owes you money, such as a customer with an unpaid invoice. A creditor is someone you owe money to, such as a supplier. Your debtors sit in accounts receivable and your creditors sit in accounts payable. The same company can be both: a wholesaler is a creditor to the retailers it supplies and a debtor to its own manufacturers.

Debtor days is the average number of days customers take to pay you. Many finance teams call the same measure days sales outstanding, or DSO. A common way to work it out: divide your trade debtors at the end of a period by your credit sales for that period, then multiply by the number of days in it. If debtors equal a third of a 90-day quarter’s credit sales, that is about 30 days. Watch the trend, not one month.

They are a checklist for deciding how much credit to give a customer: character (their record of paying), capacity (whether their cash flow can cover the bill), capital (what the business is worth), collateral (security you could fall back on) and conditions (the state of their industry and the economy). The agent can pull the payment history for the first one; people judge the rest.

Be early and make paying easy. Send a friendly note a few days before the due date, then one on the day after, quoting the invoice number, amount and a pay link or bank details. Attach the invoice again. If there is no reply after a week or two, ring. Keep the tone the same as your sales team uses, because the customer relationship outlasts one late payment.

Yes. Xero’s Australian invoicing page says reminders are sent before and after the due date, and customers can pay online by card through Stripe, or by GoCardless direct debit, PayTo or Zip. Those reminders follow a fixed schedule. They do not read the customer’s reply, notice a dispute, or change tone for a key account. That gap is where a custom agent earns its place.

Xero AU: send invoices and reminders ↗

Yes. MYOB says its Business API connects to AccountRight, new Essentials and MYOB Business files. Its customer payment endpoint can create payments and apply an amount to each sales invoice, which is what an agent needs to record what a customer paid. MYOB Acumatica is a separate product, so if you run it we confirm the connection route on the first call.

MYOB API: customer payments ↗

Xero’s published API specification lists the pieces an agent uses: emailing a copy of an invoice to the customer, reading your invoice reminder settings, recording payments against invoices or credit notes, creating batch payments, pulling the Aged Receivables by Contact report, and adding history notes to an invoice. So the agent can follow up, record and leave an audit trail without anyone retyping figures.

Xero Accounting API specification ↗

There is no single best one. Australian businesses on Xero often compare ezyCollect, CreditorWatch Collect and Paidnice, and practices look at FeeSynergy Collect. Each automates reminders with a dashboard, and some also log replies or draft next steps for approval. Pick a product if your process is standard. Consider a custom agent when you run several entities, sell through reps or an ERP, or need replies read and routed by your own rules.

Usually, yes. If your ledger is NetSuite, Odoo or QuickBooks Online, or your orders sit in Cin7 or Unleashed, the agent reads open invoices and customer details from the ledger and, where useful, order and delivery records from the inventory system, so it can answer “what was this for?” emails. We check each system’s API access for your plan before we quote.

AI can handle the early, routine part of collecting from business customers: reminders, resending invoices and statements, answering simple questions and logging promises to pay. It should not decide to stop supply, threaten action or refer anyone to a collection agency. We build agents that write email in your approved tone, stop chasing the moment a dispute appears, and pass those accounts to a named person.

It stops reminders on that invoice straight away, so a customer who has raised a problem is not chased again. It summarises the email, attaches the invoice and any order or delivery record it can find, and sends the case to the person who owns that account. Once the dispute is settled, that person marks it, and the agent picks up the follow-up again.

No. An AI collections agent works inside your own business. It sends payment reminders from your accounts address, in your name, while the customer relationship is still yours. A debt collection agency is a separate company you refer a debt to once you have stopped chasing it yourself. The agent can hand over the full history of reminders and replies if you decide to refer an account.

That is your decision, and we recommend being open about it. By default the agent sends from your accounts address and signs off with your team’s name, using wording your credit controller approved. If you want to disclose it, add one line to the email footer, such as: “Replies to this address are sorted automatically, and a person on our accounts team reads anything unusual.”

Often. When a customer pays several invoices in one transfer and sends the remittance as a PDF or email, the agent reads it, finds the open invoices by number, amount and customer name, and proposes a match. Anything it is unsure about goes into a review queue for a person. Clear matches are recorded in Xero or MYOB with a note saying how they were matched.

Yes. ASIC and the ACCC publish a joint debt collection guideline for collectors and creditors, which sets out how consumer protection law applies to collection conduct. The guideline is addressed to creditors as well as collectors, so it covers a business chasing its own invoices. Before launch, your credit controller signs off every reminder template, the send times and how often each customer group hears from you. Ask your lawyer how the guideline applies to your customers.

ASIC: debt collection guideline ↗

It can, when some of your debtors are sole traders or partners, because their details are personal information. The deadline to note is 10 December 2026. From then, the OAIC says an APP entity (a business covered by the Australian Privacy Principles) must explain in its privacy policy where a computer program helps make significant decisions about people. Ask your privacy adviser whether a credit hold suggestion counts. We give you a written description of what the agent decides.

OAIC: APP 1 guidelines ↗

It can help. Peppol is an international standard for sending invoices from one accounting system straight into another. business.gov.au lists faster payments among the benefits of eInvoicing. Start with your largest customers: ask whether they can receive Peppol eInvoices, and check that your Xero or MYOB file is set up to send them. The agent then follows up an eInvoice and an emailed invoice in the same way.

business.gov.au: eInvoicing ↗

Yes, as a bad debt, but it is an accounting and tax decision, so agree the steps with your accountant first. Usually the business shows it tried to collect, decides the debt will not be recovered, and records the write-off in Xero or MYOB. The agent can help by producing the full history of reminders, replies and promises for that customer, ready for your accountant to review.

Accounts receivable software is sold as a subscription, and each vendor publishes its own price. A custom build is priced by scope. Two Australian market guides, linked below, put custom AI agents and multi-system automation between A$15,000 and A$150,000, without saying whether GST is included. Those are market ranges, not our prices. FactoryJet quotes a fixed price per phase in writing after scoping.

Flowtivity: AI agent cost in Australia ↗ Web Video Digital: custom AI agent cost ↗

A first phase covering one entity, reminders and reply sorting in Xero or MYOB usually runs for a few weeks from the first workshop, including testing on your own past invoices. Payment matching from remittances, several entities, an ERP or inventory system, and credit hold suggestions add time. Each phase is scoped and signed on its own, so you decide whether to continue after seeing results.

Yes. Before a contract, we run a first version on a sample of your own data: last quarter’s overdue invoices and the replies your team received. You see the reminders it would have drafted and how it would have sorted each reply, side by side with what actually happened. If Xero or MYOB’s built-in reminders would do the job, we tell you then.

You do. The code and repository are yours from day one, and the AI and hosting can run in your own accounts at cost with no markup. Defects are fixed inside the build price for a cover period agreed before work starts. Support after that is optional: each change is quoted and approved, and there is no monthly minimum.

A short written brief is ideal, or an RFP (request for proposal) if you have one. Tell us your accounting system and version, how many entities, roughly how many invoices you send each month, your current reminder wording, how customers pay, and any other systems involved such as a CRM, ERP or inventory tool. A de-identified aged receivables report helps us size the job quickly.