Thursday 18th October, 2012

Continued reliance on self-scanning and manual processes is holding businesses back from improved cash flow visibility but mass adoption of e-invoicing is accelerating globally

53% of businesses still scan and capture physical invoices in-house, with a quarter not scanning invoices at all, and PDFs continue to be relied upon to send and receive invoices, according to the results of the annual Global E-Invoicing Study from Basware.

The second annual global study, which surveyed 908 finance professionals from the US, UK, Sweden, Norway, Germany and Finland, was conducted by Basware and the Institute of Financial Operations (IFO). The 2012 Global E-Invoicing Study is a benchmarking study of the e-invoicing practices by businesses of all sizes in key markets, the rates of adoption of electronic invoicing.

The study found that 81% of invoices are scanned for invoice processing, yet only 26% of enterprises outsource the scanning of purchase invoices into electronic format, with the number as low as 11% among SMEs. This presents a large burden on any size business to complete the scan and capture of physical invoices as it requires internal resource to manually scan the information and input the data or files into the system; this delays the invoice process and hinders cash flow visibility.

The volume of paper printing is also relatively high – 69% of businesses print invoices in-house. Those using more sophisticated systems (sending XML e-invoices, using point-to-point connections, third party web service or portal) are more likely to outsource printing services (30%); only 8% do not print invoices.

PDFs continue to be the most common format for ‘electronic’ invoices (58%) and whilst this is a progression from paper invoices, it shows a large percentage of companies are still a long way from full automation. Unsurprisingly, heavy senders of PDF invoices are heavy receivers. 79% of companies that send out invoices as PDFs receive email invoices in this format, compared to 50% of companies that use state billing and automation systems.

Yet, businesses with sophisticated systems experienced a number of benefits beyond companies that rely on PDF-based paperless processes: 56% of businesses with sophisticated systems experienced a reduction in the cost of invoice processing compared to their counterparts that use PDF; 38% saw a reduction in invoice errors compared to 28% using PDF-based processes.

Despite the continued reliance on rudimentary electronic documents and manual processes, the survey found that there has been a reduction in the perceived barriers that prevent the adoption of e-invoicing automation compared to 2011. Supplier resistance to e-invoicing adoption has significantly decreased from 46% in 2011 to 26% in 2012 as suppliers realise the benefits.

28% of businesses that use sophisticated invoicing systems found it had a positive impact on the relationships with suppliers and customers. There has also been a steady increase in those businesses that use electronic invoicing to some degree in 2012 – 73% compared to 59% in 2011.