Electronic invoicing is rapidly becoming a standard business process. In fact, the global e-invoicing market is on its way to surpassing the $24.7 billion mark by 2027, marking an 80% increase from $4.6 billion in 2018. The private sector has, for the most part, championed the adoption and implementation of electronic invoicing. However, there’s a rapid fundamental change led by governments across the globe. Now, many governments are encouraging businesses to adopt e-invoicing.
The European Union is a perfect example. The EU, through the EN16931, resolved to harmonize e-invoice standards. As a result, many EU member states, including the United Kingdom, now rely on the PEPPOL specifications to exchange electronic business documents.
Further, various governments are issuing mandates for suppliers engaging in public procurement to use e-invoices, resulting in B2G–business-to-government–e-invoicing.
Why are Governments Advocating for B2G e-Invoicing?
There are two main reasons governments are pushing for the adoption of B2G invoicing. These are:
To tap into the cost-saving potential of electronic invoicing. Repeated research shows that processing an e-invoice is 50 to 80% cheaper than a paper invoice. In the EU, for instance, it costs €1 to process an e-invoice compared to €30 to €50 for a paper invoice.
To encourage the adoption of B2B e-invoicing by the private sector. While the electronic invoice market is growing steadily, many businesses are yet to use e-invoices. Governments would want, therefore, to lead by example to encourage private companies to embrace electronic invoicing.
What Does B2G e-Invoicing Mean to Businesses?
To begin with, B2G e-invoicing mandates affect you directly if you’re a business that’s public procurement in countries where e-invoicing is mandatory.
Put differently, your business must support electronic invoicing to transact with government agencies in these countries.
Further, the adoption of B2G e-invoicing will propel B2B invoicing implementation. B2G mandates mean exchanging electronic documents will become a standard for supply chains. The ripple effect is that B2B enterprises will also have to adopt e-invoicing.
There will be a natural B2G to B2B transition with the new mandates. Soon, most companies will require that all their suppliers issue electronic invoicing.
What Does B2G e-Invoicing Mean for B2B Transactions?
B2B e-invoicing offers a lot of benefits. Therefore, it is not surprising that electronic invoicing has experienced phenomenal growth over the last couple of years.
Businesses in countries where B2G document exchange is mandatory already feel the impact of B2B transactions.
By having an electronic portal for public procurement, companies can see the benefits of e-invoicing firsthand–this convinces them to implement e-invoicing for B2B e-invoicing voluntarily.
How to Ensure B2G e-Invoicing Compliance
As B2G mandates continue to increase, compliance is becoming a significant concern for every business or organization conducting business in countries enforcing the use of e-invoices.
The question then becomes, how do you ensure compliance? Here’s how:
Comply With the e-Invoicing Standards
Several e-invoicing standards exist, including PEPPOL BIS, EDIFACT, UBL, etc. The first step toward electronic invoicing compliance is to familiarize yourself with these standards.
You can know what information to include in your e-invoice as per the country-specific requirement. Even more important, you want to be sure that your ERP system can support that particular standard or that you need to upgrade it.
Partner with the Right Access Point Provider
Once you’re familiar with the e-invoicing standards in the country where you’re conducting business, the next step is to find an access point provider to connect to the e-invoicing network.
Ideally, you want to partner with an e-invoicing solution that can help you become compliant. Further, you want to work with an e-invoice service provider authorized to connect businesses to e-invoicing in the country.
On top of that, you want to make sure that the access point provider is experienced enough to facilitate a smooth transition.
Also, it would be best to hire a service provider that can offer technical support and training to ensure the accounting department can make the most out of e-invoicing software.
Unimaze Can Help You Implement B2G e-Invoicing.
Sure, B2G e-Invoicing regulations can be too complex and confusing. It is essential to focus on the benefits instead of the complexity of transitioning to B2G e-Invoicing.
Still, it would help if you didn’t underestimate the time it can take to roll out e-invoicing and, by extension, B2G invoicing.
For a large, multi-national company, it can take one to two years before you can process 50% of all your invoicing electronically. It is crucial to select an e-invoicing solution that will see the onboarding process to fruition.
At Unimaze, we’ve helped businesses implement e-Invoicing projects in several countries, including the United Kingdom, Canada, Iceland, Singapore, and Serbia.
We'll be glad to hop on board if you’re looking for a reliable service provider to help roll out your electronic invoicing project as you gear toward B2G e-invoicing.
Start your B2G e-Invoicing journey today.