It is said every e-Invoice that replaces a paper invoice can deliver up to $20 in cost savings to the businesses involved, according to Deloitte Access Economics estimates.
With approximately 89 per cent of small businesses (SMEs) using manual invoices, and 1.2 billion invoices being exchanged in Australia annually, e-Invoicing can cut costs significantly, putting money back into the economy, while also improving productivity within each business if e-Invoicing is used more widely.
Given these benefits, e-Invoicing has been adopted by the Australian government with the implementation of the Pan European Public Procurement OnLine (Peppol) framework. As part of the 2020-21 Budget, the Government announced further action to increase usage of e-Invoicing for public and private sectors. For large departments e-invoicing will be mandatory by July 1st 2021 and remaining agencies by July 2022, making 80% of invoices to be e-invoices by July 2021.
Feedback from industry stakeholders is currently being collected around when all businesses should be made to adopt e-Invoicing. Key government and financial bodies are strongly suggesting that the benefits will flow if large businesses are also mandated to have e-Invoicing in place sooner rather than later.
It is clear that small business owners will benefit most from e-Invoicing. This is because larger businesses know the benefits of automating the invoice process and have already invested in refining those activities, whether with OCR or EDI technologies. Because of this investment, initially they are less likely to see the same level of benefits as an SME. This may cause larger businesses to delay adoption, so mandating becomes necessary to encourage all sides to work together.
Equally, because they have done work in this area already, enterprises can find it much easier to activate e-Invoicing within their business. It will therefore provide benefits and may not be much of a challenge to roll it out.
Whatever the outcome of this process, e-Invoicing will be mandated in Australia in the near future, and we look forward to the benefits flowing through all levels of business.