It is safe to say that there are many myths regarding e-Invoicing solutions. Many companies believe they are using e-Invoicing when, in fact, they are simply just sending PDF invoices by email. Effectively, this simply automates the postal service and is not e-Invoicing.
In this article, we dispel 5 commonly held myths about e-Invoicing solutions.
Myth #1: e-Invoicing is Too Expensive
Many people believe that e-Invoicing is very expensive to implement. However, this is not the case, especially as most of us are not aware of how much our current invoicing process costs. This can be difficult to estimate when you consider taking all direct, indirect and ‘hidden’ costs into account.
You might be shocked at how much your invoicing process actually costs! Read the blog post on The True Cost of Invoicing for more information.
e-Invoicing actually reduces the cost of invoicing as it removes many overheads such as:
- Time consumed by queries and their resolution
- Account reconciliation
- Time taken to match documents
- Missing documents
Myth #2: e-Invoicing isn’t Compliant with Tax and VAT Regulations
In Europe and many other areas of the world, e-Invoices have exactly the same legal standing as their paper equivalents.
In 2013 the EU Commission passed a directive which aims to ‘facilitate the use of e-invoicing in Europe – and therefore contribute to its greater uptake – by removing market barriers resulting from insufficient interoperability between e-invoicing systems and setting out rules for the reception of e-invoices by the public sector.’
In fact, by 2018 all government bodies within the EU will have to accept e-invoices.
Myth #3: e-Invoicing is Only for Big Companies
20 years ago, when e-Invoicing first came about, it wasn’t a solution that businesses of all sizes could adopt. It was very difficult to set up and very expensive. Only very large companies sending thousands of invoices per month had the resources to adopt it.
This perception has remained to the present day. People still think that e-Invoicing is only for big companies. However, technology and solutions today are very different, which makes e-Invoicing easy to implement and very cost effective, thus making it suitable for businesses of any size.
Myth #4: Email is Just the Same as e-Invoicing
When e-Invoicing is mentioned, many people assume that sending invoices as PDF attachments by email constitutes e-Invoicing.
However, just ask the question about what can be done with invoices that are received by email as PDF attachments?
Some organisations print the PDF documents and process them manually as if they had received them in paper format via the postal service.
Others detach the PDF documents into scanning systems, but they cannot provide 100% accuracy and time and effort is spent manually inspecting scanned images for errors.
e-Invoicing involves invoice data flowing from one system to another. Invoices may then be matched electronically against purchase orders and goods received notes.
What distinguishes e-Invoicing from email is that with e-Invoicing, data is available electronically and can be analysed, compared, stored and shared, whereas a PDF attachment is essentially a picture of a piece of paper!
Myth #5: e-Invoicing is Too Difficult to Implement
As time has progressed, it has become easier to implement e-Invoicing solutions. Most modern accounting systems have inbuilt capabilities to provide access to invoice data while older systems usually have the ability to output data in CSV format. In fact, in many cases if a simple reporting tool is available, you can be live with e-Invoicing in a matter of hours!
Myths such as these have built up over time and it will take time to dispel them. If you would like more information on how the world of e-Invoicing is being reshaped, why not review the white paper on Rethinking Credit Management! It has some thought-provoking ideas.