Online payment gateways: a guide for accountants and bookkeepers

Published Wednesday 17 June 2026

Table of contents

• Why online payment gateways improve client cash flow
• How online payment gateways work with Xero
• Payment gateway options available in New Zealand
• What to consider when recommending a gateway to clients
• How to set up a payment gateway in Xero
• Grow your practice with the Xero partner program
• FAQs on online payment gateways

Key takeaways

• Online payment gateways let your clients accept card and digital payments directly from Xero invoices, removing friction from the payment process. Xero customers who use online invoice payments get paid up to twice as fast.
• Several gateways integrate with Xero in New Zealand, including Stripe, Windcave, eWay, and PayPal. Each has different fee structures, supported payment methods, and setup requirements worth evaluating for each client.
• Recommending the right gateway is an advisory opportunity. You can help clients choose based on transaction volume, customer payment preferences, and the types of cards or digital wallets they need to accept.
• Setup takes minutes. Once a gateway is connected in Xero, online payments are automatically enabled on invoices, and reconciliation happens in the background.

Why online payment gateways improve client cash flow

Late payments remain one of the biggest cash flow challenges your clients face. When invoices rely on manual bank transfers, clients are at the mercy of their customers remembering to log in, enter the right details, and click send. Online payment gateways remove that friction by embedding a "pay now" button directly into invoices.

The impact is measurable. Xero customers who use online invoice payments get paid up to twice as fast. For your clients, that means fewer overdue invoices, more predictable cash flow, and less time spent chasing payments.

From a practice perspective, this is a straightforward advisory conversation. If a client regularly complains about late-paying customers, connecting a payment gateway is one of the fastest improvements you can recommend. It also frees up your time; less chasing means fewer ad hoc queries and cleaner reconciliations at month end.

How online payment gateways work with Xero

A payment gateway acts as the bridge between your client's Xero invoices and their customers' payment methods. When a gateway is connected, Xero adds a secure payment link to every online invoice. The customer clicks the link, enters their card details or selects a digital wallet, and the payment is processed through the gateway provider.

On the Xero side, the payment is automatically matched to the correct invoice during reconciliation. This means you're not manually matching bank feed entries to outstanding invoices; Xero handles the connection. For practices managing dozens of clients, this automation adds up to significant time savings across the board.

Xero's online invoicing supports multiple gateway integrations. Your clients can choose the provider that best fits their business, and you can standardise your recommendation based on what works well across your client base.

Payment gateway options available in New Zealand

Several payment gateways integrate directly with Xero in New Zealand. Each has different strengths, fee structures, and payment method support. Here's what to know about the main options when advising clients.

• Stripe. One of the most widely used gateways globally. Stripe charges a percentage-based fee per domestic card transaction, with no monthly subscription required. It supports credit cards, debit cards, and Apple Pay. Setup is fast, and the Xero integration is straightforward.
• Windcave. A New Zealand-based provider with strong local support. Windcave supports a wide range of payment methods, including Visa, Mastercard, and Account2Account bank payments. Pricing is typically negotiated based on volume, making it a good fit for higher-turnover clients.
• eWay. An established gateway in the Australia and New Zealand market. eWay offers transparent per-transaction pricing and supports major card brands. It's a solid option for clients who want a simple, no-fuss setup.
• PayPal. Familiar to many small business customers, PayPal lets invoice recipients pay with their PayPal balance, linked bank account, or card. It can be useful for clients whose customers already prefer PayPal as a payment method.

New Zealand banks also offer their own gateway solutions, such as BNZ Buy-line+ and ANZ eGate. These may suit clients who prefer to keep everything with their existing bank, though setup and integration options can vary.

Transaction fees differ across providers and can change, so it's worth checking current rates directly with each gateway before making a recommendation. The right choice depends on your client's transaction volume, average invoice size, and the payment methods their customers prefer.

What to consider when recommending a gateway to clients

Choosing a payment gateway isn't one-size-fits-all. As a trusted advisor, you're well placed to help clients evaluate their options based on how their business actually operates. Here are the key factors to weigh up.

• Transaction volume and fees. Clients processing a high volume of transactions may benefit from gateways with negotiable rates. For lower-volume clients, simple per-transaction pricing with no monthly fees is often the better fit.
• Payment methods supported. Consider what your client's customers prefer. Some industries see high credit card usage, while others rely more on direct bank transfers or digital wallets like Apple Pay.
• Settlement timing. How quickly funds land in the client's bank account matters for cash flow. Settlement times vary from one to three business days depending on the provider.
• Security and compliance. All reputable gateways handle Payment Card Industry Data Security Standard (PCI DSS) compliance, but it's worth confirming this with the provider. They handle card data storage and processing on your clients' behalf.
• Integration with existing workflows. A gateway that connects smoothly with Xero's accounting software reduces manual work. Look for automatic payment matching and reconciliation to keep your month-end process clean.

Building a shortlist of two or three recommended gateways for your practice simplifies client conversations. You'll already know the fee structures, setup steps, and common issues, which positions you as a knowledgeable advisor rather than someone passing along a brochure.

How to set up a payment gateway in Xero

Connecting a payment gateway to Xero is a quick process. Whether you're setting it up on behalf of a client or walking them through it, here are the steps to follow.

1. Choose a payment gateway provider

Review the gateway options available in New Zealand and select the one that best suits the client's needs. If they don't already have an account with a provider, they'll need to sign up and complete any verification steps before connecting to Xero.

2. Connect the gateway in Xero settings

In the client's Xero organisation, go to Settings, then Payment services. Select the gateway provider from the list and follow the prompts to link the account. You'll typically need the client's gateway application programming interface (API) credentials or login details to complete the connection.

3. Configure payment options on invoices

Once the gateway is connected, choose which payment methods to enable on invoices. You can set a default payment service so that every new invoice automatically includes the online payment option. This saves the client from having to enable it manually each time they create an invoice.

4. Test the payment flow

Before going live, send a test invoice to confirm the payment button appears and the process works end to end. Check that the payment shows up correctly in Xero and matches to the right invoice during reconciliation. A quick test avoids surprises when real customer payments start coming through.

5. Brief the client on what to expect

Let the client know how payments will appear in their bank feed, what the settlement timing looks like, and where to find payment records in Xero. If you're managing their books, confirm how you'll handle the reconciliation on your end. A five-minute walkthrough avoids confusion later.

Grow your practice with the Xero partner program

Helping clients set up online payment gateways is one of many ways you can add value through Xero. The Xero partner program gives you access to tools, training, and support designed for accounting and bookkeeping professionals. Joining is free, and as your practice grows you can unlock additional features at higher partner tiers.

Xero is trusted by over 4.6 million subscribers worldwide. Join the partner program to strengthen your advisory services and help more clients get the most from their financial tools.

FAQs on online payment gateways

Here are answers to some frequently asked questions about online payment gateways and how they work with Xero.

Do clients need a separate merchant account to use a payment gateway?

It depends on the provider. Gateways like Stripe and PayPal bundle the merchant account into their service, so clients can start accepting payments without a separate banking arrangement. Traditional providers like Windcave may require a merchant facility through the client's bank. Check the provider's requirements before recommending one.

Can clients use more than one payment gateway in Xero?

Yes. Xero supports connecting multiple payment services within the same organisation. This can be useful if a client wants to offer both card payments and PayPal, for example, or if they process transactions through different gateways for different purposes.

How are gateway fees reflected in the client's accounts?

Gateway providers typically deduct their transaction fees before settling funds to the client's bank account. The amount arriving in the bank feed will be slightly less than the invoice total. During reconciliation in Xero, you can allocate the difference to a payment processing fees expense account to keep the books accurate.

What happens if a customer disputes a payment made through a gateway?

If a customer raises a chargeback or dispute, the gateway provider handles the process. The disputed amount is usually held or reversed until the dispute is resolved. You should advise clients to keep clear records of the goods or services delivered, as the gateway provider will request supporting documentation during the dispute process.

Are online payment gateways suitable for all types of Xero invoices?

Online payment gateways work with standard Xero invoices sent via email or shared through a link. They're well suited to service-based businesses, subscription billing, and project-based invoicing. For businesses with complex point-of-sale needs or high-volume retail transactions, a dedicated POS (point-of-sale) system may be a better fit alongside the gateway.