Electronic invoicing, or e-invoicing, just like the name implies, could be the electronic exchange of invoice documents from the supplier and the customer. Electronic invoicing goes past merely sending a PDF receipt to a customer via email. A genuine e-invoicing option is a built-in solution where an electric invoice is transmitted and received seamless between the supplier’s a / r system along with the customer’s accounts payable system. E-invoicing documents are normally exchanged in EDI or XML formats. (Source: E-Invoicing Basics)
Why switch from the manual, paper-based system to a electronic invoicing system? Paper-based system is notoriously time-consuming and prone to errors. Therefore, paper invoicing is likely to have higher costs and longer processing lifecycles.
Despite the widespread adoption of automation for several business processes, accounts payable and a / r processes remain largely manual (Source: Dolphin Corp).
Advantages of E-Invoicing for Suppliers
Switching to e-invoicing solves these issues, leading to faster processing, lower transaction costs, greater visibility, and significant savings. From a business perspective, e-invoicing delivers advantages through the AR / AP process.
First of all, there isn’t any mail to sort, distribute, or open. In addition to that, e-invoicing eliminates expenses related to paper bills, envelopes, and postage. Plus, it requires significantly less time to process generate bill payment. With all the new system, you could make and distribute an entire batch of invoices with only a couple of clicks. (Source: Pay Simple)
Next, there isn’t any data entry required. Because the payment arrives in the buyer’s accounts payable system automatically, the accounts payable clerk doesn’t need to enter in the data yourself. E-invoicing eliminates the opportunity for mistakes and ensures accuracy. Likewise, there’s no need to scan paper bills, another manual method that will take time and could be prone to errors for example illegible scans.
Meanwhile, all invoices are instantly and securely delivered. By reduction of mail from the equation, you happen to be also eliminating a few days from receipt to payment. Similarly, electronic payments speed the process and mean it’s not necessary to wait in line with the bank to deposit your money.
Electronic invoices are easy to store and reference, without physical file cabinets required. When you follow up with customers, you can easily incorporate a link or attachment for the original payment receipt, purchase order, or related documentation.
Great things about~advantages of~important things about E-Invoicing for Buyers
E-invoices offer benefits for the customers also. As an example, you’ll be able to give you a various payment options for example debit, credit, and ACH. Paperless system also paves the way to automated reminders complete with integrated "pay now" buttons that url to the check. Your customers’ accounts payable team will appreciate not having to manually enter data or scan paper bill, too.
Switching to e-invoicing saves time and expense, a win-win both for sides.
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