Brisk growth in E-invoicing and the 3 drivers accelerating it further
e-Invoicing, Digitalization, e-Invoice receiving, e-Invoice sending
Recently, the European E-invoicing Service Providers Association EESPA reported that over 1,25 billion electronic invoices were processed and delivered by its members last year. Compared to the volumes of the previous year, the figure shows a significant increase of 27% in total in B2B, B2G and B2C e-invoices.
It is a brisk growth, and considering that the EESPA members handle over half of all the electronic invoices in Europe, it is fair to state that e-invoicing is in general in a strong tailwind in Europe. But I’m already looking forward to an even more substantial growth that I believe is just around the corner.
Currently, there are many developments in motion pushing the progress further. With our long experience and exceptionally strong foothold in the Nordics – the region that has been and still is the forerunner in e-invoicing – we at OpusCapita are able to actively participate and contribute to the development.
Firstly, the Peppol network (Pan-European Procurement Online) is quickly expanding in Europe. As I said in my previous blog, I believe Peppol will be the game changer in European e-invoicing. Why? As an open, many-to-many network it helps to solve the interoperability, making it easy for any company, regardless of size, industry or location, to join e-invoicing. Peppol’s original aim was to simplify electronic procurement processes in B2G trade, but the OpenPeppol association is now promoting the use of the created standards in B2B trade as well.
Another important step towards common interoperability is the Multilateral Interoperability Framework Agreement, MIFA, that EESPA is about to launch. The agreement is being piloted among EESPA members during the end of this year. The agreement predefines the legal and technical requirements for the e-invoices, so that the service providers only need to comply with a couple of business rules. It takes away a lot of the cumbersomeness of the closed networks and enables an easy step into the common exchangeability.
And thirdly, the new EU directives obligate public sector authorities to receive electronic invoices by the end of the year 2018. It will further remove obstacles from cross-border electronic procurement and trade. Although, I share the concerns that EESPA and OpenPeppol association voiced together about the implementation. At present, the European norm includes multiple syntaxes, meaning the technical languages of the e-invoices. If the public authorities need to be able to receive all of these, the burden might prove be too heavy for them, making the implementation too expensive and thus hindering the adoption. The negotiations are ongoing – we’ll have to wait and see how it turns out.
While many of the obstacles to interoperability are being removed, there is one development in the EU market that I am worried about – the many country-specific or industry-vertical rules that the public sector wants to impose locally on the e-invoices in order to fight the black economy, for instance. These small fractions might hinder the single European market and the seamless interoperability. We need to be proactive to overcome this challenge in Europe as well.
Don’t wait too long to get on the train
Don’t let these challenges I mentioned distract you – you shouldn’t wait any longer. Leave the challenges for the industry professionals to solve and start gaining the benefits that the companies who have already switched to electronic invoices are already enjoying. It is not a train you are going to miss, if you don’t climb onboard now. But, eventually everybody is going to get in it, so I believe the sooner you do it, the better it is for you.
If you are a buyer, you may soon find yourself out of the competition if you are not taking the advantage of the cost and process efficiencies. Electronic invoices help to unlock high, end-to-end automation of accounts payable and optimization of purchase-to-pay process, and even support improving the financial performance of your entire supply chain with receivables financing and dynamic discounting solutions.
And if you are a supplier, you should find the most suitable and futureproof solution for issuing electronic invoices. Soon your customers are going to demand e-invoices from you, if they already haven’t. To avoid the harm and cost of adapting to each of your customers’ needs one by one, look in to the future and choose a service provider with a wide, easy-access delivery network to begin with to be ready.
Solution Owner, E-invoice Networks, OpusCapita
Member of EESPA Executive Committee
Lead of Invoice Response Project in OpenPEPPOL