7 Best OCR Software of 2023: Extract text from images

Business Wire recently reported that the global Optical Character Recognition (OCR) market is projected to grow by 15.4% annually and that by 2030 it will reach a value of USD 33.44 billion. The demand driving this growth is automation. More specifically, being able to automate how we digitize documents and manage important data streams.

Businesses in the banking, medical, retail, and insurance sectors, among others, are increasingly turning to OCR to automate document processing. OCR software can help to automate everyday tasks such as customer onboarding, ID verification, and basic office administration. The value of that in terms of money and time saved is significant, but with multiple software applications vying to take on that work, which is the best?

Read more for our list of the best OCR software of 2022, and the value of switching over to automated document digitization.

What is OCR Software?

OCR technology extracts text from scanned documents and images, digitizing information that would otherwise have been manually processed and entered into a data system. Manual data entry, though the norm up until recently, runs the risk of incurring errors and high costs.

With OCR software, businesses are able to automate data capture and limit these issues. When combined with Machine Learning technologies to comprehend the context, OCR can return the extracted data in structured forms like CSV or JSON, making it readily available for further analysis.

Why OCR?

In the digital era, data is its own currency. A business operating without a good handle on its data is shooting in the dark and who can blame them when 80% of data is trapped in unstructured formats like physical documents, PDFs, emails, and images? The solution to this problem begins with OCR.

The only true limitation of OCR software is that it works best when combined with other technology. The capability of OCR itself is confined to recognizing characters and returning texts that it identifies. The result is not structured and furthermore, OCR alone cannot identify specific data fields or information that the users want to extract. However, when used with other AI technologies such as Machine Learning models and Natural Language Processing, OCR provides a highly usable solution to the problem of unstructured data.

The problems that OCR software can help businesses solve extend from simplifying administrative tasks to improving customer experience. Here are some examples of the benefits of this technology:

Increase Operational Efficiency

The fastest typist ever recorded typed at 216 words per minute. The fastest OCR software can recognize almost seven times that per second. Manual document processing and data entry cannot come even close to matching how fast OCR can perform the same tasks, it’s why the software is such a game changer. By increasing the speed of document processing, every other process that follows can occur quicker too. OCR's positive knock-on effect on overall operational efficiency is one of its most significant advantages.

Provide Better Customer Experience

We’ve all been stuck in a bank or store with a set of lengthy forms and tasked with filling out our information in a way that feels unnecessarily time-consuming. With OCR available, it really is unnecessary. OCR software can make it so that a simple scan of your ID is all that’s needed in these scenarios. Once scanned, it would recognize the relevant details from the ID and populate the form with the extracted information.

Providing this speedy experience isn’t just more efficient for a business, it also creates a better experience for the customer and allows them to walk away feeling like their time wasn’t wasted.

Reduce Cost

There are a few ways in which OCR software helps to reduce costs but chief among them is that by eliminating manual data entry, labor costs are reduced. It also reduces the risk of expensive errors being made which is so often the risk when doing things manually.

Perhaps the most unexpected cost benefit of OCR is simply a storage one. All those files of paper that would usually need to be stored in big cabinets are replaced by a single server and platform. Not only does this mean that physical space frees up, but finding the files is far more simplified – yet another cost and time saver.

How OCR is Used Across Multiple Industries

If you’re still asking, “What is OCR software?”, the best way to understand it is sometimes just to see it in action. Here are some of the main industries that have already found success using OCR:

Retailing

OCR technology completely streamlines shipping tasks by automating how data is captured from packing lists and purchase orders. Retailers can also automatically extract data from receipts, digitize invoices, track inventory, and more. This saves time on manual work, reduces the risk of errors, and ensures that the retailer is gathering all available insights on customers and their behaviors.

For customers, OCR software can be used to simplify how they claim rewards. They just have to take a photo of their receipts, upload them to the reward app, and the OCR software integrated within will extract the data and return it to the reward app for the customer to claim rewards or accumulate membership points. OCR is a win not just for retailers, but also for their consumer base.

Finance and Banking

Some of the first companies to incorporate automation technology and OCR into their workflow were banks and insurance companies. In these contexts, processes such as customer onboarding are simplified with the use of OCR software to a simple scan of the customer’s ID, proof of address, or passport – no paper forms required.

This simplification extends to how financial institutions can extract data from other documents including pay slips, and loan and mortgage applications. Performing these tasks with OCR software rather than doing them manually makes for faster and more accurate data extraction. It’s why OCR integrates so well into the finance and banking sector.

Public Sector

Processing applications for governmental subsidies tends to require a large amount of identity verification. By incorporating OCR technology into public sector websites and systems, governments can extract data from documents like IDs or business certificates much faster. This then speeds up the whole administrative process and prevents the age-old issue of a government application getting stuck just because someone didn’t have the time to look at your form. Incorporating OCR software improves the administrative efficiency of the public sector as well as the overall experience of the citizens relying on it.

Telecom

When you’re applying for a new phone number, telecom service providers will generally require that you upload images of your ID documents as well as fill out accompanying forms. With the boost of an OCR application, you would simply scan your documents with your smartphone camera, the relevant information would be extracted and then added digitally to the Telecom’s system. The sale’s person’s time would be saved, and so would yours as the customer.

The Best OCR Software of 2022

Our list of the best OCR platforms of 2022 covers a range of features and even includes an option for free OCR software …

FormX

FormX is a cloud-based SaaS that uses AI to extract information from virtually any document and process them into structured and accurate digital data. A few examples include invoices, receipts, bank statements, handwritten forms, shipping orders, applications, IDs, and much more.

While there are many pre-configured data extraction models available to use with FormX, you can also train your own custom models to suit your specific business needs. API integration with any apps or software is effortless, making it ideal for teams without developers as well as teams with developers. For those without, FormX also provides a desktop app that can parse PDFs and images into Excel spreadsheets in batch. The dependability and flexibility of FormX makes it one of the best OCR software solutions out there and has attracted users that include Google, Link REIT, and Wilson Parking.

Perhaps its most exciting offering is that it’s one of the few free OCR software options available ­– the first 100 documents processed with FormX are completely free.

FormX uses AI to automate data extraction from any physical documents.
The First 100 documents are FREE.
Get started by Signing Up or Scheduling a demo

Google Document AI

Part of the overall Google Cloud, Document AI is a document processing platform that utilizes machine learning to extract data from physical documents and provide analytical insights. While their current AI modules don’t have the best documentation and customization is quite difficult, this tool has a great reputation in terms of speed and ease of implementation. This is especially true if you already have a Google-based tech stack. It is however notably more expensive compared to similar OCR platforms.

AWS Textract

AWS Textract is one of the more well-known OCR platforms. What makes it one of the best OCR software options available is the tool’s ability to identify and understand data that is in table form, which has historically been a roadblock for OCR technology.  AWS Textract is incredibly easy to use and offers a pay-per-use payment model, so there’s no worry of overpaying for your product.

The shortfall of this software is that though it includes basic machine learning, it’s not possible to train AWS Textract and its accuracy tends to slip when faced with scanned documents that are messy or handwritten.

Docparser

Docparser is a popular and well-trust OCR tool that boasts all the usual capabilities of this kind of software. To use it, all you have to do is scan a printed document and transfer it to your account on the Docparser platform. Once you’ve finished creating your parsing rules, you can then pull the text you need from those documents and send that data to a wide range of third-party platforms, from Google Sheets to Microsoft Word and more.

Nanonets

Another great example of an OCR platform that is based on artificial intelligence, Nanonets is capable of automating data capture for various document or image. It provides a range of features through the use of machine learning, image processing, and deep learning. The platform is inexpensive, great for integration and customization, does not require any developers or development teams, and can handle large volumes of documents.

ABBYY Flexicapture

Able to extract data from documents and images and transform them into structured, usable data, Flexicapture hits all the basics that a business generally requires from OCR software. However, the initial setup of Flexicapture can be quite difficult and though it generally recognizes images well, this capability drops when the software is faced with low-resolution images and documents. It’s also not easily customizable and doesn’t offer templates to use for things like processing invoices automatically.

ABBYY Finereader

Though it can be slow to process big files and requires a learning curve to use, this OCR software is mainly aimed at PDF file editing and can convert images into multiple, editable electronic formats. It offers a user-friendly interface and the unique feature of being able to compare documents. It is however on the pricier end of products such as this.

What Sets FormX Apart From the Competition?

FormX has helped various businesses across the globe automate data extraction by combining the power of OCR with machine learning and other AI technologies. Aside from the pre-built extraction models such as receipt, passports, international IDs, etc., FormX also allows any users build their own custom extraction models even without the help of developers.

The intelligent document processing solution:

Achieves 90%+ Accuracy

Our pre-processing features optimize images in several ways, such as adjusting the image angle, light condition, skew correction, etc., to maximize extraction accuracy. Furthermore, as our extraction models are powered by machine learning, even the users can improve the accuracy by labelling the desired fields and providing more sample images.

Is A No-Code Solution

Automatic data extraction from documents with FormX requires little to zero code. Anyone can easily create custom extraction models by uploading sample images and marking specific data fields. FormX will then take care of the rest. Moreover, the intuitive UI and clear instructions allow users to easily familiarize themselves with the portal within a short period of time.

Provides Simple API Intergation

Troubled by complicated integration that makes the workflow even more chaotic? Data extraction of FormX is API-based where the results are returned in JSON format. As a result, it can be easily integrated with any software or application to automate document processing and various workflow.

Ensures Data Security and Privacy

Data extracted from various documents, such as IDs, business certificate, passports, and more, often includes confidential information that shouldn't be shared with any external parties and must be protected securely. FormX does not use or store any images or the extracted data to ensure data security.

In addition, FormX is also protected by the latest user authentication technologies to not only keep your information safe but also ensure a smooth authentication experience.