Xero VS Wave: Comparison

Wave's free and low-cost plans are great for small businesses, while Xero's more robust features work well for medium to large businesses.

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Erica Seppala
Editor & Senior Staff Writer

Last updated onUpdated July 15, 2026

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Xero VS Wave

	Xero	Wave
Ideal For	Medium to large businesses	Small to medium businesses
Pricing	$25 - $90/month	$0 - $19/month
Standout Features	Numerous advanced features 1,000+ integrations Strong security	Forever free plan Easy-to-use interface Supports multiple companies & users
What’s Missing	Built-in payroll Built-in payment processing Phone support	Integrations Advanced reporting Features like time tracking & inventory management

Table of Contents

Xero VS Wave: At A Glance
Where Xero Wins
Where Xero Falls Short
Where Wave Wins
Where Wave Falls Short
Xero VS Wave: Pricing Comparison
Xero VS Wave: Features Comparison
Which Is Best For My Business: Xero Or Wave?

Xero VS Wave: At A Glance

On the surface, Xero and Wave have a lot in common. Both are also well-reviewed across the internet. But once you dig a little deeper, you’ll see that there are some very distinct differences.

Xero is a robust accounting solution that rivals QuickBooks in terms of capability and popularity. It offers strong accounting, 1,000+ integrations, access for unlimited users, and an impressive feature selection.

Wave, on the other hand, is designed with small businesses in mind. The software is easy to use and boasts standard features such as invoicing, contact management, and personal and business expense tracking. There’s also a forever-free plan available.

It’s also possible that neither option fits the bill. If that’s the case, we invite you to check out our picks for best accounting software for small businesses to see other top choices that may be better for your small business.

Where Xero Wins

Xero offers a more robust accounting feature set than Wave, including inventory management, accounts payable, advanced reporting, and one of the strongest contact management systems available in small business accounting software.

Xero also outpaces Wave with more than 55 built-in reports and over 1,000 integrations, making it a better choice for businesses with more complex accounting needs.

In addition, Xero offers strong security features, a 99.97% uptime commitment, and feature-rich mobile apps for iOS and Android.

Here’s where Xero stands out:

Robust accounting features
Numerous reports
1,000+ integrations
Strong security
Full-featured mobile apps

Where Xero Falls Short

Wave has the advantage when it comes to pricing, especially for freelancers and very small businesses. While Xero’s Early plan is affordable, its usage limits make it best suited for businesses with lower invoicing and billing needs. Growing businesses will likely need to upgrade to one of Xero’s higher-priced plans.

Xero also requires a separate subscription for each business you manage, which can become expensive if you oversee multiple companies.

Xero also relies on third-party integrations for payroll and payment processing rather than offering these features natively. It also doesn’t include live bookkeeping services.

Finally, Xero has a steeper learning curve than Wave. While it’s not difficult to learn, its broader feature set may require more time for new users to master.

Here’s where Xero falls short compared to Wave:

More expensive than Wave
Steeper learning curve
No built-in payment processing
No built-in payroll

Where Wave Wins

Wave stands out for its free accounting plan, which includes more features than many competing free accounting platforms. It’s an excellent choice for freelancers and small businesses that need basic accounting software without a monthly subscription.

Wave also offers optional payroll, payment processing, and bookkeeping services, making it easy to add additional business tools as your needs grow.

Unlike Xero, Wave supports unlimited users and up to 15 businesses under a single account at no additional cost. Combined with its intuitive interface, it’s a great choice for small businesses and accounting beginners.

Here’s where Wave stands out:

Forever-free accounting plan
Unlimited users
Supports up to 15 businesses per account
Easy to use
Great for freelancers and small businesses

Where Wave Falls Short

Wave’s biggest drawback is its limited feature set. While it covers the accounting basics well, it lacks some of the advanced accounting tools you’ll find in software like Xero.

Wave also offers fewer reports and integrations than many competitors, making it less flexible for businesses with more complex accounting needs.

Its mobile apps are more limited than the web version, and some users have reported bugs and missing features, particularly on the free plan.

Here’s where Wave falls short:

Limited advanced accounting features
Fewer reports than competitors
Limited integrations
Mobile apps not full-featured

Xero VS Wave: Pricing Comparison

	Xero	Wave
Price	$25 - $90/month	$0 - $19/month
Number Of Users	Unlimited	Unlimited
Discounts Available
Payroll	Gusto integration starts at $49/month + $6/month/employee	$40/month + $6/employee or contractor
Payments	Varies by third-party processor	2.9% - 3.4% + $0.00 - $0.60 per transaction
Live Bookkeeping	Not available	$149+/month

Xero has three pricing plans, and all plans support unlimited users for no additional fee. The company frequently runs promotions for new users, and a 30-day free trial is available to test out the software.

Xero does not offer a built-in payroll but integrates nicely with Gusto. There’s also no built-in payment processing, but you can choose from several third-party processors. Live bookkeeping services are not available.

Wave has two plans. The paid Pro plan includes more automations, digital receipt capture, and discounted payment processing rates. You can save money on this plan by signing up for an annual subscription.

Wave also has built-in payroll and payment processing, as well as Live bookkeeping services.

Xero VS Wave: Features Comparison

Feature	Xero	Wave
Invoicing
Inventory Management
Project Management	Established Plan
Time Tracking	Established Plan
Payroll	Gusto integration
Budgeting
Live Bookkeeping		Add-on
Reports	55	12
Integrations	1,000+	4

Features are where Xero really sets itself apart from Wave. With Xero, you’ll find lots of advanced features, strong reporting, and numerous integrations.

However, don’t count Wave out just yet, as it does offer some things you won’t find with Xero, including built-in payroll and a live bookkeeping add-on.

Here’s a breakdown of how Xero and Wave differ in terms of their features.

Accounting

Both Xero and Wave offer the standard features you’d expect to find with accounting software.

With Xero, you’ll find features such as a customizable dashboard, invoices, quotes, contact management, bank reconciliation, inventory management, accounts payable, and expense tracking.

Xero also has more advanced features, such as class tracking, project management, time tracking, fixed asset management, and expense claims.

Wave has the features you would expect for small business accounting software. Wave’s notable features include bank reconciliation, expense tracking, invoices, accounts payable, contact management, and inventory management.

Wave does lack some of the more advanced features you’d find with Xero. However, many smaller businesses will find everything they need with Wave, and you can’t beat the cost (or lack thereof).

Invoicing

Xero offers decent invoicing, although it only has a single template. Wave has multiple invoice automations, including recurring invoices, automated invoice reminders, and bulk invoicing.

The biggest drawback is that unlimited invoicing is only available on Xero’s two more expensive plans. The Early plan is limited to just 20 invoices per month.

Wave has surprisingly well-developed invoicing, which is unlimited even on the free plan. Wave has three invoice templates that are customizable. There are also a handful of automations available, although automated payment reminders are only available with Wave Pro.

One drawback of Wave’s invoicing is that discounts and sales tax must be added manually.

Inventory

Xero has a pretty advanced inventory management feature that’s available on all plans. With this feature, you can add products and services, track inventory, make adjustments, and add attachments.

Wave’s inventory feature is essentially a list of items. There are no inventory tracking or management options available.

Project Management

Xero has a project management feature that businesses can use to create projects, track expenses and time, and send invoices. The only caveat is that this feature is only available on the most expensive plan.

Wave does not have a project management feature.

Time Tracking

Subscribers of Xero’s Established plan can track time and add it to projects.

Wave does not offer time tracking.

Payroll

Xero no longer offers built-in payroll. Don’t be too disappointed, though, as the software integrates with Gusto. Gusto offers competitively-priced, easy-to-use payroll software that’s received high marks here at Merchant Maverick.

Wave does offer built-in payroll. Wave Payroll is also easy to use and competitively priced.

Budgeting

Xero has a budgeting feature that allows you to create a three-month, six-month, 12-month, or 24-month budget. You can view a summary at any point to make sure you’re on track to your financial goals.

Unfortunately, Wave does not offer a budgeting feature.

Live Bookkeeping

If you need assistance with bookkeeping services, Wave has you covered. For an additional monthly fee, you can subscribe to Wave Advisors services. These services include bookkeeping support and accounting coaching.

Xero does not offer comparable services.

Reports

While both offer reporting, Xero has a more extensive reporting feature. You can create, view, and print 55 different reports covering everything from sales to cash flow and budget.

Wave has only 12 reports that cover the basics, such as balance sheets, profit and loss, and cash flow.

Integrations

Xero is at the top of its game when it comes to integrations, with over 1,000 options available in the Xero App Store. API is also available for developers.

Wave, on the other hand, lags significantly behind, as it only integrates with PayPal, Etsy, Shoeboxed, and Zapier. API is available for developers.

Customer Support

While not technically a feature, it’s important to note a few things about the customer service and support of Xero and Wave.

Xero’s self-service support options are pretty top-notch, offering everything from the Xero Central help center to in-software help. It’s getting in touch with a human that’s the problem, as Xero does not offer phone support, and email responses could take up to a day to receive.

Wave also has customer service issues, especially if you’re on the free plan. If you’re on the free plan, self-help resources are all that are available to you. Phone support isn’t available to any user (paid or otherwise), although email and live chat options are available to Wave Pro subscribers.

Which Is Best For My Business: Xero Or Wave?

Xero and Wave are both excellent accounting software options, but they’re designed for different types of businesses.

Xero is the better choice for businesses that need advanced accounting features, extensive integrations, robust reporting, and room to grow. While it’s more expensive than Wave and takes longer to learn, its scalability makes it a strong long-term solution for growing businesses.

Wave is best suited for freelancers and small businesses with basic accounting needs. Its free plan, intuitive interface, and support for multiple users and businesses make it one of the best free accounting solutions available.

Ultimately, the right choice depends on your budget, accounting needs, and how much complexity your business requires today — and in the future.

Choose Xero If …

You need advanced, scalable accounting software
You rely on integrations with other business software
You need features like inventory management and project tracking

Choose Wave If …

You’re a freelancer or small business with basic accounting needs
You want free or low-cost accounting software
You prefer an easy-to-use platform with a minimal learning curve

Still undecided? Wave offers a free plan, and Xero offers a free trial, so you can try both and see which best fits your business.

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Erica Seppala

Editor & Senior Staff Writer at Merchant Maverick

Erica has been writing about small business finance and technology since 2008. She joined Merchant Maverick in 2018 and specializes in researching and reviewing business software, financial products, and other topics to help small businesses manage and grow their operations. Her expertise has been cited in MSN, Reader's Digest, Vox, U.S. News & World Report, and Real Simple. She is a Certified ProAdvisor for QuickBooks Online and QuickBooks Payroll, a graduate of Limestone University, and currently resides in Greenville, South Carolina.

View Erica Seppala's professional experience on LinkedIn.