Invoice scanner; A detailed guide to invoice scanning

Invoice scanner; A detailed guide to invoice scanning

(Last Updated On: January 25, 2023)

Since ages, manual data entry and record keeping has led to businesses suffering from manual paperwork and data processing, lost invoices, and lack of transparency in invoice processing.

All this manual data entry can lead to incorrect data entry and human error, delaying the billing cycle and causing duplication. To improve data capture and processing, more and more businesses are leveraging AI business solutions to manage their data. Solutions like Invoice scanning software allows you to centrally capture documents, reduce manual processing of invoices, and process them accurately in a fraction of the time.

The term invoice scan is sometimes used broadly to refer to the digitization of paper invoices. However, in today’s digital world, hardware scanners are rarely used. Instead, many organisations rely on invoice data extracting solutions that automatically extract invoice data from electronic invoices or PDFs. Invoice scanning is the first step for AP automation.

Learn more about Invoice Scanners and Invoice Scanning below:

Invoice scanner is basically a software that scan and capture important data on an invoice and present it in a machine readable format and are scanners for invoices and receipts. Invoice scanners enable the users with absolute data transfer in automated workflows. An invoice contains a lot of data fields like vendor, date, invoice ID, amount, etc. which are crucial for business processes which requires businesses to capture this data in a manner that it can be processed, interpreted, and analysed in an efficient and seamless manner.

To ease this process, an invoice scanner can help businesses with quick and efficient digitalization of invoices. In short, invoice scanning refers to the seamless process of scanning, capturing, and converting and extracting paper invoice into a digitised format for ensuring seamless processing of data.

Why should you use an Invoice Scanner?

The major challenge for companies undergoing digital transformation is that even after digitised invoices being easy to share, the data in these invoices is not accessible easily. When invoices are shared in formats like scanned images, PDFs, etc. they cannot be given to any ERP software for further data processing as documents in PDF format are usually not machine readable.

This raises certain questions like, how do companies have access to the well-structured data contained in scanned invoices? How can a company digitally validate a transaction that has been approved as a scanned invoice? How can accountants and data analysts extract important invoice data to keep workflows running smoothly?

This is where Invoice Scanners can be resourceful, considering invoice scanners are capable of recognising and extracting any invoice data into a machine readable format be it JAVA, csv, xsl, etc. Invoice scanners enable businesses to ensure a flawless digital workflow by entering important invoice data as needed and required.

How does an Invoice scanner work?

Invoice scanners leverage OCR technology for extracting information from digitised invoices. OCR (Optical Character Recognition) allows invoice scanning software to recognize and capture data.

By using AI and ML features with OCR, one can train the invoice scanner to extract only the key-value data fields of interest. Such automated invoice processing software works with ready-to-use and pre-trained invoice scanning algorithms. The typical workflow is as follows:

  • First, one needs to upload the invoice into the invoice scanner
  • The invoice scanner starts scanning and extracting data according to the business rules set the user
  • The data is then presented in a machine readable format like csv, doc, etc.
  • This extracted data can be used in ERP software for further processes

What are the qualities of the best invoice scanner?

The best invoice scanner can help you with the following:

  • Make the data capturing, entry, and processing quick and easy
  • Save time
  • Reduce errors
  • Capture a high quality image
  • Has easy sharing options
  • Increase data accuracy
  • Streamline operational process

Advantages and Disadvantages of using an invoice scanner

Like other business solutions, automated invoice scanning has considerable benefits and some limitations. By weighing these factors together, organisations can assess the feasibility of invoice scanning for internal processes.


  • Saves time, has higher accuracy and speed of work as compared to manual processes
  • Displays fewer errors as compared to manual processes
  • In addition to extracting invoice metadata like supplier, date, amount, etc., automatic Invoice Scanners can also extract invoice data from lines
  • Cost saving by eliminating inefficient manual processes and effort
  • Invoice processes provides a rather highly scalable solution as it is capable of processing a lot of data volume


  • It isn’t 100% accurate
  • Common data limitations such as handwritten texts, obscure scans, low resolution images, unrecognisable / unreadable fonts, and distorted text can affect overall performance and accuracy
  • Unknown invoice formats are not recognized accurately
  • Not capable of capturing unstructured data


After understanding the benefits and limitations of invoice scanning and its automated solutions, it is up to you to decide which invoice automation solution you should opt for. It is advisable for you to schedule a demo with a different solution provider. If you would like to contact our experts, you can click here.

Ashutosh Saitwal
Ashutosh Saitwal

Ashutosh is the founder and director of the award winning KlearStack AI platform. You can catch him speaking at NASSCOM events around the world where he speaks and is an evangelist for RPA, AI, Machine Learning and Intelligent Document Processing.