Wave vs Xero
A head-to-head comparison to help you pick the right tool
Last updated: April 30, 2026
Wave
Wave is a free accounting and invoicing platform designed for small businesses, freelancers, and solopreneurs. It offers genuinely free accounting, invoicing, and receipt scanning with no subscription fee. Wave makes money through payment processing and payroll add-ons. It is one of the best free accounting tools available for very small businesses with simple needs.
Xero
Xero is a cloud-based accounting platform popular with small businesses and accountants worldwide. It is known for its clean interface, strong bank reconciliation tools, and excellent integration ecosystem. Xero is particularly popular in Australia, New Zealand, and the UK, and is considered the main alternative to QuickBooks for cloud-based accounting.
Pros
- ✓Genuinely free accounting and invoicing — no subscription required
- ✓Clean and easy to use interface
- ✓Good enough for most very small businesses and freelancers
- ✓Receipt scanning and bank connections included free
Cons
- ✗Limited features compared to paid alternatives
- ✗Customer support is minimal on the free plan
- ✗Not suitable for growing businesses with complex needs
- ✗Payroll and payment processing add-ons can add up in cost
Pros
- ✓Beautiful and intuitive interface — one of the cleanest in accounting software
- ✓Unlimited users on all plans — no per-seat pricing
- ✓Excellent bank reconciliation with smart matching
- ✓Strong ecosystem of 1000+ integrations
Cons
- ✗Payroll requires a separate add-on in most regions
- ✗Inventory management is basic compared to QuickBooks
- ✗Reporting is less comprehensive than QuickBooks on lower tiers
- ✗Customer support is primarily online with no phone support
Wave vs Xero: Side by Side
| Factor | Wave | Xero |
|---|---|---|
| User Rating | N/A | N/A |
| Category | Accounting Software | Accounting Software |
| Pricing Model | Freemium | Paid |
| Starting Price | Free | $15/mo |
| Best For | Solopreneurs and very small businesses wanting free accounting and invoicing software | Small businesses and accountants wanting a clean, modern alternative to QuickBooks |
| Our Pick | — | — |
Wave Features
- ✓Free accounting
- ✓invoicing
- ✓receipt scanning
- ✓bank connections
- ✓financial reporting
- ✓payments processing
- ✓payroll add-on
- ✓mobile app
Xero Features
- ✓Bookkeeping
- ✓invoicing
- ✓bank reconciliation
- ✓expense claims
- ✓payroll
- ✓financial reporting
- ✓inventory
- ✓project tracking
- ✓integrations
- ✓mobile app
Pricing Comparison
Our Take
Choose Wave if solopreneurs and very small businesses wanting free accounting and invoicing software. Choose Xero if small businesses and accountants wanting a clean, modern alternative to quickbooks.
Best For
Solopreneurs and very small businesses wanting free accounting and invoicing software
Best For
Small businesses and accountants wanting a clean, modern alternative to QuickBooks
How Wave and Xero Are Similar
- •Both are Accounting Software platforms designed for business teams
- •Both offer web-based access with no software installation required
- •Both provide customer support and onboarding resources
- •Both integrate with popular third-party business tools
- •Both offer a trial or demo to evaluate before purchasing
Also Consider
If neither Wave nor Xero is the right fit, Dext is worth evaluating.
Dext
Bookkeepers, accountants, and businesses with high receipt volumes wanting to eliminate manual data entry
From $15/mo
Frequently Asked Questions
What is the difference between Wave and Xero?
Wave is best for solopreneurs and very small businesses wanting free accounting and invoicing software. Xero is best for small businesses and accountants wanting a clean, modern alternative to quickbooks.
Which is better, Wave or Xero?
Choose Wave if solopreneurs and very small businesses wanting free accounting and invoicing software. Choose Xero if small businesses and accountants wanting a clean, modern alternative to quickbooks.
How much does Wave cost?
Wave starts at Free. Pricing model: Freemium.
How much does Xero cost?
Xero starts at $15/mo. Pricing model: Paid.
Who should use Wave?
Solopreneurs and very small businesses wanting free accounting and invoicing software
Who should use Xero?
Small businesses and accountants wanting a clean, modern alternative to QuickBooks