Xero invoice reminders: how to set them up — and when you've outgrown them

Updated 3 August 2026 · By the Badger team

Xero's built-in invoice reminders are free, already in your subscription, and better than chasing nothing. Start there. This guide covers how to set them up well — and the honest checklist for recognising the day your business has outgrown them.

Xero's features change over time — check Xero Central for current behaviour. Badger connects to Xero, so yes, we have a view here; we've tried to be fair about it.

What Xero invoice reminders do well

Switched on (Business menu → Invoices → Invoice Reminders), Xero will automatically email customers about unpaid invoices on a schedule you set — before the due date, on it, and at fixed intervals after. You can edit the wording of each reminder, include a link to the online invoice, and turn reminders off for a particular customer or a particular invoice. For a business whose late payers just need a nudge, that's genuinely enough — and it costs nothing extra.

Two setup tips that fix the most common complaints: personalise the default wording (stock reminder text reads like stock reminder text), and set the first reminder close to the due date — day 3, not day 14. Speed of first contact is the strongest predictor of getting paid.

Where built-in reminders stop

Xero's reminders are a scheduler, not a credit controller. The gaps show up predictably as a book grows:

• Replies land on you. "Can you resend it?", "I've already paid", "can I pay half now?" — the reminder went out automatically, but every response still needs a human to read, answer, chase evidence, and remember the outcome.
• The tone doesn't escalate far. A few templated emails step up only as far as you pre-wrote them. There's no judgment about who needs a gentle third nudge versus who needs a firm notice and a phone call — and no warning/final stage with a human in the loop.
• No promises, no plans. A customer who says "I'll pay Friday" or asks for instalments needs tracking: was the promise kept? Is the plan on schedule? Built-in reminders have no memory of any of it.
• Email only. No SMS for the customers who never open email, and no channel judgment about who responds to what.
• No morning picture. Reminders fire invoice by invoice. Nobody tells you "here's what's going out today, here's who paid so I stopped, here's the one reply that needs you."

The honest checklist: built-in is enough if…

• You have a handful of late invoices a month, from customers who pay after one nudge.
• Replies to reminders are rare, and you're happy fielding them yourself.
• Nobody's ever surprised by an invoice quietly hitting 60+ days.

…and you've outgrown it when:

• Reminder replies are a real inbox stream, and answering them is someone's unpaid second job.
• You're manually watching who promised what, who's on a payment plan, and who needs the firmer letter.
• You've turned reminders off for tricky customers because the fixed sequence felt wrong — which means your hardest payers now get chased the least.

That last one is the classic tell. The customers you exempt from automatic reminders are precisely the ones who most need a smarter chase.

What "dedicated AR software on top of Xero" adds

Accounts receivable software like Badger connects to Xero and picks up where the scheduler stops: invoices and payments sync in automatically, every overdue invoice gets a courteous chase that escalates properly, replies are read and answered with a draft for your approval, payment plans are negotiated inside limits you set, and a paid invoice halts its reminders instantly — checked again at send time. You get one morning email with the whole picture and a single Approve button. Your Xero stays the system of record; Badger is the colleague working it.

The two aren't rivals: run Xero's reminders while your book is easy, and move up when the checklist above says so. When you do, Badger is A$129/month + GST with a 14-day free trial — connect Xero and the first morning brief tells you exactly what it found in your book.