eInvoicing is the digital exchange of invoice data between supplier and buyer software, happening in Australia and NewZealand via the ATO supported Peppol network. In this article, we’ll dive deeper into what eInvoicing is, how it works, what its benefits are and how it fits into a businesses’ hyper automation strategy along with ProSpend.
Invoices existed thousands of years ago as clay tablets – and possibly even tens of thousands of years ago as Ishango Bones.
Through the 80s and beyond, most businesses adopted computer generated invoice documents – they are easier; more efficient and accurate; convey more information. Larger corporations had the kind of requirements and invoice volumes though, where this was adopted but not effective enough. They had to also make significant investments in Electronic Data Interchange (EDI).
Instead of getting bogged down with invoice documents at all, EDI connects software so data could just flow between buyer and supplier screens – no documents needed. However, the complexity, ongoing costs and security risks of such systems meant that only very large organisations could afford to establish EDI “data super-highways”, and that too, just with their larger trade partners that could also afford it.
Cue eInvoicing (aka EDI on steroids). Instead of establishing locked networks between a buyer and a limited number of suppliers, eInvoicing relies on an open and centralised network to which all buyers and suppliers around the entire world can easily connect. This network can then be instructed to transmit transaction related data between suppliers and buyers at the click of a button, without ever needing a superfluous invoice document. The government supported eInvoicing network in Australia, NewZealand, Singapore, Europe, North and Central America and even parts of Asia is the Peppol network, which is ever growing in terms of its global coverage.
To really establish the “no-brainer-ness” of taking up eInvoicing, here is a list of some clearly laid out key benefits:
Cost Savings
Processing paper and emailed PDF invoices can cost $27 to $30 each. eInvoicing via ProSpend can drop that cost down to the $2-$5 range or less per invoice. 500 invoices = $12,500 dollars saved….. (mic dropped… yep)
Fewer Errors
eInvoices are validated before even being accepted by the network. Corrections, re-typing, relentless back and forth, miss communication, language barriers… eliminated!
Increased Reliability and Security
The Peppol network maintains very high global security standards and eInvoicing by-design removes points of failure from the process so fraud and scam risks are much lower.
Reduce Payment Times
With guaranteed delivery of invoices and drastically improved visibility, suppliers will find it easier to enforce strict Pay On-Time or Pay Penalty policies. Buyers registered for eInvoicing will receive preferential treatment by suppliers and may even be able secure better deals because they are more likely to pay invoices quicker.
Connect Once, Trade with Many
Registering once with the Peppol network means you can trade with anyone else on the Peppol network without needing to register again. It no longer matters that your trade partners use different systems and tools.
The benefits of eInvoicing are now clear, so how do businesses get it set up? It’s easy. All you really need is a Digital Service Provider (DSP) like ProSpend, that is accredited by the Australian Peppol Authority, and your ABN. Simple.
The only limiting factor at this point is whether or not your suppliers are eInvoicing ready. While the number of businesses registered is constantly and quickly increasing, most buyers will still need to cater for multiple invoice formats. As a leading provider of a highly adaptable, comprehensive business spend management platform, ProSpend has you covered on that front. We automate and streamline the processing of all invoice formats – paper-based, digital PDFs, CSV files, eInvoices.
Already increasing employee budget visibility and control, digitising procurement, invoices and expenses and deeply integrating to client ERPs and other systems – eInvoicing is yet another feature with which ProSpend achieves optimal hyper automation results and delivers on unique client automation strategies.
Join us at the ATO e-invoice week for a hosted webinar https://www.ato.gov.au/business/eInvoicing/
ProSpend is Australia’s leading Spend Management Platform that offers Smart Automation for finance teams. Through one cloud-based platform, you can easily manage expenses, supplier invoices, purchase orders and travel spend. All with budget visibility. ProSpend is 100% Australian owned & developed and is used every day by leading brands, including KFC, WWF, Best & Less, Guide Dogs, Peoplebank and many more. For those looking to better understand the benefits of automation, book your FREE savings consultation.