Note: pricing for this product is in US$.

All businesses need to invoice their customers for products and services supplied. Invoicing is, of course, available in accounting packages that also track accounts receivable and handle many other chores such as financial statement preparation.

But if you don't want the hassle of installing full-fledged accounting software and keeping your records up to date, you can use an online service that handles just the billing and collection services you require.

That's the appeal of Zoho Invoice, part of a growing suite of online business services from Zoho. Zoho Invoice lets you invoice customers by e-mail, track receivables, and collect payments online.

The flexibility of Zoho's suite design means you can share common data with other, extra-cost Zoho services, such as Zoho CRM (customer relationship management) and Zoho Projects. You may also export data to accounting apps in CSV, Excel, and other formats. But if invoicing is all you need, you can use and pay for just that.

The free edition of Zoho Invoice limits you to five invoices per month. Yet even the high-end plan, which offers sufficient capacity for most small businesses, costs a relatively modest US$35 per month.

Despite its low cost, Zoho Invoice offers enough flexibility in invoice forms and sales reporting to suit the billing needs of almost any small business. If you don't require a complete integrated accounting program, but want to automate your sales invoicing and collections, Zoho Invoice could offer just the right mix of services for you.

Using Zoho Invoice

Signing up for Zoho Invoice, if you don't already have a Zoho account, is easy. Zoho Invoice is highly flexible — so much so that you could spend 20 to 30 minutes or so to choose the options that suit your business.

We particularly liked the selection of estimate and invoice templates designed for selling services or products, or to collect fixed price amounts, which are generally used for recurring bills. You may also design your own custom template, with sales tax rates you define.

You can opt to skip most of the configuration steps until you create your first invoice. Zoho Invoice lets you select most invoicing options on the fly, as you create the bill.

Invoice lets you decide how to follow up on unpaid bills. You may select up to three e-mail reminders and determine how many days after the payment due date they should be sent. You may also change the default reminder message text.

Zoho Invoice is particularly well suited for exporters, since it supports multiple currencies.

We're disappointed, however, that Zoho Invoice supports only PayPal for online payment of invoices. While PayPal is easy to use and not unreasonably priced for very small businesses, cheaper payment options exist for businesses that have larger monthly sales volumes.