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What is Automated Billing?

Malcolm Tatum
Updated May 16, 2024
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Automated billing is an action in which the invoicing for goods and services occurs without the need to prepare the invoice by hand. Many billing systems of this type provide the ability to generate and send electronic copies of the invoices to customers. The use of this type of billing software makes it possible to manage the invoicing process with greater efficiency, saving the company both time and money.

There are several features that are common to automated billing software. In most cases, the software is designed to allow the creation of customer profiles which contain all the data needed to accurately prepare the invoice. This data will include the customer name, billing address, billing contact, and an email address if the invoice is to be sent electronically. In most cases, the automated billing program will collect data from other sources that have to do with customer usage, or allow for the manual entry of orders once they are fulfilled. The processes within the billing system then apply the proper rates for each order and create an invoice.

Depending on how the automated billing system is configured, the invoice may be printed out, along with a companion envelope, immediately after the invoice generation. However, it is possible to set up the software so that invoices are automatically printed at a specific time of day. There are even some examples of software that will prompt machinery to fold the invoice, insert it into a pre-addressed envelope, and seal the envelope. When email is used as the delivery medium, the system may expedite the delivery immediately after generating the invoice, or manage the email process at a specific time of day, an approach that allows business owners to survey invoices before they are sent out.

Electronic billing systems of this type sometimes include the ability to receive and apply payments to outstanding invoices. For example, email invoices may contain a embedded link that allows the customer to immediately render payment after receiving and reviewing the invoice. Rather than requiring an individual to receive the payment and manually enter it into the Accounts Receivable database, the software recognizes the payment, applies it to the appropriate invoice number, and deducts that amount from the balance of the customer account.

Automated billing works very well with situations where a customer has a standing order, or there is a recurring payment that must be requested on a weekly or monthly basis. With this application, the system can be configured to automatically generate standing or recurring invoices to the appropriate customers, thus eliminating the need for one or more employees to spend hours on this repetitive task. The end result is that personnel can be utilized for different functions, allowing the workday to be more productive and thus cost efficient.

The use of automated billing is common today with companies of all sizes. Business types ranging from telecommunications to online retail stores benefit from the use of this types of software. By saving the company time and resources, businesses are able to keep expenses lower and thus remain more competitive.

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Malcolm Tatum
By Malcolm Tatum
Malcolm Tatum, a former teleconferencing industry professional, followed his passion for trivia, research, and writing to become a full-time freelance writer. He has contributed articles to a variety of print and online publications, including SmartCapitalMind, and his work has also been featured in poetry collections, devotional anthologies, and newspapers. When not writing, Malcolm enjoys collecting vinyl records, following minor league baseball, and cycling.
Discussion Comments
By anon1000095 — On May 25, 2018

As online accountant, I can help those who have more complex financial circumstances to lower their tax bills and/or keep them in compliance with the tax laws. Those laws can get very complicated for those with businesses, rental properties, etc.

By anon311804 — On Jan 04, 2013

I've a read a lot about automated invoicing tools. Never used one though. They say Invoicera, Freshbooks, and Zoho take the cake. So, I'm still on the fence about that.

Malcolm Tatum
Malcolm Tatum
Malcolm Tatum, a former teleconferencing industry professional, followed his passion for trivia, research, and writing...
Learn more
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