As of 2 March, 2026 Xero is changing how it charges for use of its developer APIs: instead of a revenue-share model, it’s shifting to a subscription + usage model.

For years, the low entry cost of basic cloud accounting software like Xero justified what many call the “chain of bolt-on fixes”. Endlessly bolting on apps to fill core functionality gaps. While that approach once made financial sense, rising API fees and increasing limitations now expose the hidden cost of relying on too many add-ons.

Why this matters and why some businesses are nervous

• Rising costs for integrators and apps: Previously many third-party apps built on Xero might have operated with little or no direct API-usage fees (or under a revenue-share model). The new flat-fee + metered-usage model means that as data volume or number of connections grow, so can costs.
• Passing on the fees: Apps may respond by increasing their subscription fees or limiting features, potentially raising costs for end-users (businesses relying on those integrations).
• Need to manage data volume carefully: For businesses with many integrations, large transaction volumes, or automated data flows, unmonitored data egress could lead to unpredictable overage fees.

Essentially, what may have felt like “free and flexible” integration with Xero may now come with a material new cost burden.

Why this change bolsters the case for investing in a full-blown Cloud ERP

Given the uncertainty created by API-fees, many businesses may want to reconsider whether a standalone cloud-accounting platform like Xero remains the best long-term solution. That’s where a true Cloud ERP (Enterprise Resource Planning) system starts to look more compelling:

• Integrated, unified platform – not bolt-on patches: Cloud ERP consolidates accounting, inventory, sales, reporting, CRM, and other business functions into one core system. This reduces reliance on many separate apps glued together with APIs.
• Lower hidden costs & better predictability: Instead of paying per integration or per data-transfer (as under API-based pricing), Cloud ERP typically comes as a subscription bundle, giving you predictable monthly/annual costs, less exposure to usage spikes.
• Scalability and flexibility to grow: As your business expands, more locations, more products, more users, a cloud ERP can scale with you via modular add-ons and licensing changes, without the complexity of adding and managing a growing web of integrations.
• Real-time data, analytics and unified visibility: A single source of truth: financials, stock, sales, operations, all in one place and updated live. That improves decision-making, reduces data silos, and cuts down on manual reconciliation.
• Reduced IT overhead, maintenance and compliance burden: Cloud ERP vendors take care of hosting, backups, security, updates, which lets your internal team focus on business rather than IT headaches.
• Long-term ROI and future-proofing: While a comprehensive ERP may involve higher initial commitment, its ability to streamline operations, reduce waste, prevent duplication and manage growth often delivers stronger long-term return than a patchwork of accounting + add-ons

In short: as reliance on API-based integrations becomes more costly and restrictive, Cloud ERP gives businesses a more stable, scalable, and “all-in-one” foundation rather than a fragile patchwork of tools.

What should businesses do now

• Audit your current setup: List all third-party integrations you use with Xero (inventory, CRM, e-commerce, reporting, add-on modules) and estimate how much API-usage or connections they require.
• Model the future costs under the new API-fee schedule: Especially if you’re a high-volume business or use multiple integrations. Factor in potential overage charges.
• Compare with Cloud ERP offerings: Evaluate cloud-ERP solutions to see what features you get (ERP + CRM + inventory + reporting, etc.), how pricing works (subscription vs usage), and whether they meet your business needs.
• Think long-term: If you plan to grow (more products, more users, multiple locations), Cloud ERP’s scalability, unified data, and reduced administrative overhead often pay off.
• Assess your risk tolerance & flexibility needs: If you value stability, predictability and integrated data more than “pick-and-choose” flexibility, an ERP gives the cleaner, more maintainable path forward.

The shift in Xero’s developer pricing, is a clear signal: the “free-for-all” era of cloud accounting + many add-on tools is entering a more regulated, commercialised phase. For businesses that rely heavily on integrations or that are scaling up, this change could mean higher costs and greater compliance overhead.

That makes now a smart time to seriously consider investing in a full-featured Cloud ERP. While the up-front commitment might be greater than sticking with standalone accounting and plug-ins, the long-term benefits, unified data, predictable costs, scalability, and less IT friction, make it a strategic investment for growth, efficiency, and resilience.

Ready to future-proof your business with a modern Cloud ERP?

Momentum Software Solutions helps growing organisations move beyond disconnected apps and rising integration costs by implementing fully integrated, cloud-based ERP platforms. If your current systems are holding back data visibility, scalability, or automation, our expert team can guide you toward a smarter, more efficient way of working.

Let’s explore how a unified Cloud ERP can support your next stage of growth:

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