Invoice Data Extraction: Best AI Tools & How It Works
In the past, extracting data from invoices was a tedious manual process. Even with traditional accounting software like QuickBooks, businesses had to rely on employees to copy and paste invoice details.
Fortunately, AI has revolutionized invoice data extraction, making it as seamless as a tap on a screen. With AI, invoices can be scanned, understood, and categorized automatically, reducing errors and boosting efficiency.
In this article, we’ll cover:
- Fundamentals of invoice data extraction
- How AI-powered invoice processing works
- 5-step guide to automated invoice processing
- Top 5 AI platforms for invoice data extraction
What is invoice data extraction?
Invoice data extraction refers to the process of capturing key details from an invoice such as vendor information, invoice number, line items, and total amount and transferring it into another application, such as a database or accounting software.
Traditionally, businesses assigned teams to manually input invoice data, which was time-consuming and prone to human error. Today, AI-driven invoice processing automates this entire process, increasing accuracy and speed.
Why AI automation outperforms manual data extraction
AI-powered invoice management utilizes technologies like Natural Language Processing (NLP), Optical Character Recognition (OCR), and machine learning (ML) to extract and organize invoice data efficiently.
Key advantages of AI-driven invoice processing:
- High accuracy: AI follows predefined rules, ensuring data is extracted precisely while reducing human errors.
- Compliance-friendly: AI-generated reports help maintain detailed audit trails, simplifying tax reporting and regulatory compliance.
- Cost savings: Automating invoice extraction reduces labor costs and reallocates human resources to higher-value tasks.
- Scalability: AI can handle a high volume of invoices across multiple clients with different formats and structures.
Which industries benefit from AI invoice automation?
Many industries benefit from automated invoicing, including:
- Healthcare: AI-powered invoice management helps healthcare providers maintain HIPAA-compliant records while improving data accuracy.
- Financial Services: AI-driven automation ensures precise financial tracking, fraud detection, and regulatory compliance.
- Logistics: Logistics firms process thousands of invoices from various suppliers, making AI a crucial tool for streamlining billing and payments.
How to set up automated invoice data extraction: 5 steps
Step 1: Identify the data you need to extract
Determine the essential invoice fields, such as invoice numbers, vendor details, line items, and payment terms. Involve your accounting team to ensure the right information is captured.
Step 2: Choose an AI-powered invoice extraction tool
Selecting the right AI platform is key to successful automation. Here are five top platforms for AI invoice processing:
- Axioma AI: A robust AI-driven invoice management system that seamlessly integrates with existing accounting software.
- Azure Document Intelligence: Microsoft’s AI-powered tool designed for enterprise-level data extraction.
- Docparser: A cost-effective option for small and medium businesses processing structured invoice formats.
- Nanonets: Uses AI to convert unstructured invoices into organized financial records.
- Astera: A scalable enterprise solution for large businesses handling high invoice volumes.
Step 3: Configure your AI workflow
Set up your AI platform to automatically retrieve invoices from emails or cloud storage. Define which fields need extraction and where the data should be exported (e.g., QuickBooks, Google Sheets, or Airtable).
Step 4: Test and refine the process
Run test extractions on sample invoices to verify accuracy. Adjust workflow settings to ensure data is captured correctly before fully implementing automation.
Step 5: Deploy automation gradually and monitor performance
Start with a small batch of invoices, review results, and then scale up. Continuously monitor accuracy and make refinements as needed.
Key features to look for in AI invoice extraction software
- Real-time automation: Instant data extraction from invoices received via email or cloud storage.
- Customization: Ability to adjust workflows and extraction parameters based on unique business needs.
- Security & compliance: Ensure the software follows strict security standards (ISO 27001, SOC 2, HIPAA) to protect sensitive financial data.
- Integrations: The AI tool should seamlessly connect with third-party accounting and ERP systems.
How the top AI invoice extraction tools compare
Feature | Axioma AI | Azure Document Intelligence | Docparser | Nanonets | Astera |
Free version | ✅ | ✅ | 14-day trial | ✅ | ❌ |
HIPAA & SOC 2 Compliance | ✅ | ✅ | ❌ | ✅ | ✅ |
Best for SMBs | ✅ | ❌ | ✅ | ❌ | ❌ |
Custom Workflows | ✅ | ✅ | ✅ | ✅ | ✅ |
Pricing | Starts at $29/month | Pay-per-page model | Starts at $39/month | Usage-based | Contact sales |
#1 Axioma AI: Best all-in-one invoice automation tool
Features:
- AI-powered invoice data extraction tailored for businesses of all sizes.
- Integration with QuickBooks, Google Sheets, and more.
- Secure, SOC 2 and HIPAA-compliant invoice management.
Pricing: Starts at $29/month.
#2 Azure Document Intelligence: Best for enterprise users
Features:
- Advanced OCR-based invoice scanning and structured data extraction.
- Designed for large-scale enterprise document processing.
Pricing: Pay-per-use model, starting at $1.50 per 1,000 pages.
#3 Docparser: Best for structured invoices
Features:
- Simple UI for small and medium businesses processing structured invoices.
Pricing: Starts at $39/month.
#4 Nanonets: Best for handling unstructured data
Features:
- AI-powered NLP and OCR for extracting data from messy, unstructured invoices.
Pricing: Usage-based pricing.
#5 Astera: Best for enterprise-level automation
Features:
- Large-scale automation designed for businesses handling high invoice volumes.
Pricing: Contact sales for details.
Final thoughts
AI invoice processing is transforming how businesses handle invoices. Axioma AI offers a streamlined, secure, and customizable solution for invoice data extraction. Whether you’re a small business or an enterprise, implementing AI-powered invoice automation can save time, reduce errors, and improve financial management.
Ready to automate your invoice processing? Try Axioma AI today and simplify your accounting workflow!