How to connect your Xero account to Pencil?

1. Go to www.pencilpay.com Click on the LOGIN button top right on the home page

2. Log in with your Supplier login

3. On the Left-hand side of the click on the “Integrations” tab
4. Select the software in which the Supplier has

   1. Click on the Xero integration tile:

      1. Click on “Get Started”.

      2. Log in to your Xero account.

      3. Click Allow Access.

      4. Select your Xero company from the dropdown and confirm terms of use.

      5. Update the Reconciliation Configuration:

         1. Bank Account
            Select which bank account you wish funds collected to be transferred to; if you don’t have an account, click on the + sign and add, then go back and refresh the list.

         2. Pencil clearing account
            This is the account that Pencil will use to auto-reconcile multiple invoice payments that make up a single bank disbursement. This account should be a separate Current Asset account with “BAS excluded” and the "Enable payments to this account" checkbox ticked.

         3. Customer Credit account
            You can find this account in your DEAR account Settings > Reference Books > Account Mapping > Customer Credit Account. Pencil will use this account to map the bank transaction created from Dear for Customer Deposit collected through Pencil platform. If you don't use DEAR set this to the Xero account you use to apply customer credits.
         4. Chargebacks account
            Your chargebacks account should be the expense account in Xero where you wish to post chargebacks. Pencil will push a chargeback to Xero as a bill.

         5. Transaction Fee Account
            Select which account you wish the Pencil transaction fee to be linked to; if you don’t have an account, click on the + sign and add, then go back and refresh the list.

         6. Invoice Line Item Account
            If you manually import invoices we will assign these sales invoices to this account; select which account you wish to be linked to; if you don’t have an account, click on the + sign and add, then go back and refresh the list.

         7. Branding Themes
            Please select which branding themes which you want to allow your customers to pay their invoices directly from your Xero invoices.

         8. Custom Payment Service Pay Now Text
            Leave this as is, or if you wish to display your own customised text in place of the Pay Now button in your Xero invoices.

         9. Sync contacts options
            You have the ability to sync only Customers with Invoices linked “Customers only” or sync all your contacts in Xero, except for Suppliers with Bills linked “All contacts excluding suppliers”.

         10. Sync Customers using Inventory Settings
             Pencil will sync Xero contacts that are already linked from your inventory system and are not part of the excluded customer groups (enable this setting if you use DEAR Tags).

         11. Enable Contact Group Config:
             If you have specific contacts groups that you wish to sync to Pencil, turn the toggle ON. Pencil will sync the grouped contacts based on your configuration.

             1. If you toggle this setting on you can choose to Include or Exclude groups by selecting one from the Xero Customer Groups dropdown.

             2. Then you can “Select Groups” by clicking in the box and selecting the available groups.

             3. In the “Do you want to sync customers without Xero Groups to Pencil?” toggle, if you have contacts that you wish to sync to Pencil, but have not added any groups to in Xero, turn the toggle ON. Pencil will sync the non-grouped contacts based on sync contacts option you have added above.

         12. Enable pushing payments as customer credits
             Toggle ON to allow Pencil push payments as customer credits or toggle OFF to set as Disabled.
         13. Enable resyncing inactive customers
             Toggle ON to allow Pencil resync customers and invoices that are set as Inactive in Pencil or toggle OFF to set as Disabled.
         14. Enable pushing payments on checkout
             Direct debit payments take 3 business days to process and sometimes they fail. This setting allows you to choose if you want to push the direct debit payment immediately to your accounting system (toggle this setting ON). If you run your business on statements and only want the payment to be updated in your accounting system on successful disbursement of the funds; then toggle this setting OFF.

      6. Click Save to save changes.

      7. Click the green sync button if you want to push the updates now or wait for the system to sync for you.