Should you integrate Xero with a spend management platform? Yes! Here's why (and how)

If you use Xero, you already know it’s a smart, intuitive accounting platform for small and medium-sized businesses. It handles everything from automatic bank reconciliation to expense tracking, so you can spend less time chasing receipts and more time running your business.

Connect Xero to a dedicated spend management platform, and you instantly see spend in real time — across every entity, department, and team. You get tighter controls, faster processes, and complete visibility the moment you need it.

Why integrate Xero with a spend management platform?

As you grow, finance gets more complicated — more people, more spend, more accounts to track. What once worked with spreadsheets or basic tools quickly starts to buckle under the pressure of more people, more spending, and more moving parts.

You end up chasing receipts, updating budgets, and reconciling transactions by hand — a process that quickly becomes unsustainable. And while accounting tools like Xero are brilliant at the basics, they’re not built to handle the real-time demands of a scaling business — that’s where automated spend management comes in.

Without automation or integration, you’re stuck reacting to problems instead of preventing them. Here are five common moments when growing companies outgrow their finance setup:

1. No real-time visibility into spending transactions

Lack of real-time visibility makes it difficult to track spending, spot issues quickly enough, or keep accounts accurate. Delays in syncing transactions can lead to outdated data and more manual work. 

But with a seamless Xero X spend management integration, you can get complete and instant visibility, with approved expenses automatically pushed to your bank feed and categorised in real time.

2. Fragmented data, no unified view.

As your business grows, your finance setup starts to feel the strain. What used to be simple — a few transactions, one bank account, maybe a shared company card — quickly turns into a messy web of bank portals, shared folders, and employee-bound cards. Suddenly, nothing’s connected, and your finance team is stuck stitching together spreadsheets just to see where money went.

Tools like Xero are great for accounting, but they’re only as good as the data that goes in. And if you’re relying on manual uploads or chasing receipts across teams, you’re always a step behind.

That’s why having one place to manage all your spend matters so much. When your expense data flows straight from cards to accounting, with native integrations handling the sync, you get real-time reconciliation and up-to-date spend visibility without any manual work.

3. Slow month-end closures

Month-end doesn't have to be stressful. But if your processes are manual, it probably is. Finance teams waste hours chasing receipts, fixing errors, and piecing together data from different systems.

Integrating Xero with a spend management platform changes that. Approvals flow faster. Reconciliation happens automatically. Errors drop. Compliance improves. And you close the books quicker, with less stress and more confidence in the numbers.

Carolina Einarsson, CFO at Essentia Analytics, says of the Xero x Payhawk integrations: 

The integration Payhawk has developed for Xero is one of the strongest I've seen in the market. You just need to do a click in Xero, and all the information is shared in Payhawk.

4. Lack of compliance and audit-readiness

Manual expense tracking makes it difficult to enforce policy compliance or maintain clear audit trails without visibility into who approved what and when, resulting in compromised accountability.

Connecting Xero to a modern spend management tool ensures every action is automatically logged, giving you a transparent audit trail and enforcing compliance across the organisation.

5. Manual, slow, and error-prone reconciliation

Manually reconciling expenses is slow, frustrating, and often inaccurate.
Without automation, you’re comparing statements, retyping amounts, and chasing missing receipts just to get the books straight.

But reconciliation becomes automatic when you can connect Xero seamlessly with a spend management platform. Transactions sync in real time, receipts are matched instantly using OCR, and everything lines up without the manual work. You get clean, accurate books — without the late nights.

P.S. It’s not just theory. Take MDM Props, for example. They save 32 hours every week after switching to Payhawk, just by eliminating manual finance admin.

Key features to look for in a spend management platform (as a Xero customer)

With so many features floating around, which should you focus on?

These are the priorities:

Multi-currency support

Although Xero can help you manage bank accounts and transactions in multiple currencies, you can’t manage multi-currency payments like you can by integrating with a spend management platform. 

At Payhawk, our platforms can facilitate international payments in over 50 currencies, helping you access low-cost cross-border payments, which is essential for any business dealing with suppliers, customers, or employees outside of their local currencies. 

Built-in approval flows and role-based permissions

Although you can mark invoices as “awaiting approval” in Xero, you can’t build multi-step approval workflows to suit your unique organisational structure. Spend management platforms allow you to create custom approval workflows and assign role-based permissions to control spend at a granular level, without creating approval bottlenecks or disrupting business operations.

Assign designated approvers for different expense types and ensure spend policy compliance at every turn.

Advanced spend controls and customisable spending limits

You can only get spend controls and limits with a third-party spend management integration. Take Payhawk for example, with us, you can issue physical or virtual corporate cards to every employee, empower accountable spending, and manage it all remotely.

Set merchant spending restrictions or issue single-use cards for project-based work or contractors, and keep sight of every penny spent without all the manual effort.

Stephen Wilkinson, Finance and Operations Director at Astrid & Miyu, says:

As a Finance Director, financial literacy outside the finance function is super important. And with Payhawk, we've been able to change the spend culture internally and make everyone autonomous for their own budget.

Real-time integration with Xero for seamless sync

Find a spend management solution that exports things like deposits, reviewed expenses, and settled transactions directly into your Xero account in real time. As soon as you connect with Payhawk, for example, you have automatic bank feeds in Xero. It reflects every incoming and outgoing transaction once settled, giving you accurate financial records, always with one-click reconciliation to reduce the manual burden.

Integrate Xero with Payhawk in just a few clicks

Let’s kick this direct integration off. You’re closer than you think to flexible, effortless expense exporting. Remember, to start this integration, you need admin rights for both Payhawk and Xero.

1. Find the Xero integration. From the dashboard, navigate to settings > integrations, find Xero and click connect.
2. Map bank accounts and categories. To ensure accurate transaction data synchronisation, specify which bank account corresponds to each Payhawk account, also known as bank account mapping.
3. Sync masterdata, including Tax rates, tracking categories, and  G/L codes
4. Export and reconcile transactions. Once reviewed, Payhawk pushes deposits and expenses, and settled transactions from Payhawk automatically export to Xero as paid bills or bills to pay.
5. Your supplier data stays in sync both ways, and you can update integration settings anytime, without ever disconnecting.

See the Xero and Payhawk integration benefits in action in the Astrid & Miyu video below.

Case study: Astrid & Miyu free up 40 hours a week in their finance team with Payhawk

Forty hours? That’s a full-time job! Since integrating Xero with Payhawk, the Astrid & Miyu team managed to cut down processing times by 66% and free up 40 hours each week from their finance team:

Since introducing Payhawk, expenses are no longer seen as a burden. It’s really boosted morale in the finance team — and the rest of the business — and we no longer dread the end of the month!

To manage spend effectively? You need to integrate

Centralising spend management and connecting it to Xero removes uncertainty in decision-making, forecasting, budgeting, and growth planning. It helps prevent discrepancies that can arise from delayed or incomplete manual data entries and reduces fraud and non-compliance. It standardises your entire expense management process across all your entities and gives you control over spending you just wouldn’t get if you solely rely on Xero.

With the landscape of spend management changing rapidly, with the rise of AI in categorisation, reconciliation, and reporting, you can’t afford not to invest in tech to help you streamline your financial processes, improve company-wide efficiency, and reduce manual errors and tasks as you scale. In a competitive environment, you must remain agile and compliant as your team grows.

Book your personalised Payhawk product demo today and see how quickly you can close the month, cut manual work, and get complete control over spend with Xero + Payhawk.