The way businesses handle invoices is changing fast. Manual processes that once worked at scale are now falling short. Whether it's meeting new compliance standards, improving accuracy or keeping up with the speed of modern operations, there's a growing demand to improve how invoices are sent and processed.
E-invoicing, a concept that’s been around for decades, offers an efficient and accurate way to transmit invoices. Governments worldwide are taking note, pushing for greater adoption to improve transparency and security, while businesses are recognizing its value in cutting costs and boosting efficiency. Perhaps this is why the global e-invoicing market is forecasted to grow at a 16.2% CAGR to nearly $17 billion (€15.4 billion) by 2029.
This page will guide you through everything you need to know about e-invoicing, from how it works to its strategic role in invoice automation, along with the global trends driving its adoption. Whether you’re looking to streamline your invoicing process, stay compliant with evolving regulations or simply reduce manual workloads, e-invoicing is the future – and it’s happening now.
For a closer look at the role of invoice automation in accounts receivable, check out our article: Order to cash: The definitive guide to a complex process.
Table of contents
- What is e-invoicing?
- What are the benefits of e-invoicing?
- The state of e-invoicing around the world
- The role of e-invoicing in invoice automation
- Why is it best to perform e-invoicing and invoice automation within NetSuite?
- New technologies that are improving invoice automation
- How can you get ready for e-invoicing?
- Frequently asked questions about e-invoicing
- Preparing for the future of invoice automation
- The journey to invoice automation starts now
What is e-invoicing?
E-invoicing isn’t about sending a PDF via email (electronically). E-invoices are structured data sets that contain all the necessary information from an invoice, sent and received through a regulated network. This network not only delivers the invoice instantly, but it also identifies the specific customer or vendor who should receive it. The entire process is fully digital and typically happens in seconds – whether triggered by a click or fully automated within your enterprise resource planning (ERP) system.
Unlike unstructured invoices like PDFs sent via email, e-invoices don’t require manual intervention. PDFs may be produced, sent and viewed electronically, but they still involve manual steps like data entry or verification. E-invoices are far more efficient. They exist in a structured format such as XML or EDI, and they communicate all invoice data electronically. This means an e-invoice is readable only by machines and is processed automatically, without any human input.
Today, when businesses refer to e-invoicing, they’re almost always talking about structured e-invoicing. In fact, some countries have advanced legislation that doesn’t recognize PDFs as e-invoices. Governments and organizations are increasingly adopting standardized, secure systems that support fully paperless, automated submissions of vendor bills directly between suppliers’ and customers’ ERP systems.
For more information, check out our video: What is e-invoicing?
What are the benefits of e-invoicing?
E-invoicing provides substantial benefits for businesses, customers and governments by automating the delivery of invoices as structured data sets, ensuring accuracy, security and speed.
For businesses that send invoices
With e-invoicing, businesses can streamline invoice delivery, removing manual steps like data entry and reducing the risk of errors. By automating the transmission of invoices, businesses can ensure faster, more secure delivery, improving operational efficiency and accuracy.
One key benefit is security—e-invoicing significantly reduces the risk of fraud by using verified, secure networks for invoice delivery. Businesses can rely on full traceability, ensuring no unauthorized changes are made to invoices.
E-invoicing also simplifies cross-border transactions. Invoices are automatically translated to meet local standards, eliminating the complexities of international invoicing and ensuring timely, accurate delivery across regions. And since it relies on less paper than traditional invoicing, e-invoicing helps businesses reach their sustainability goals, too.
For companies that receive invoices
Customers benefit from faster, more reliable invoice delivery. With e-invoicing, structured invoices can be automatically processed into their systems, eliminating manual entry. Any errors are flagged automatically, streamlining communication and reducing the need for follow-up.
Additionally, e-invoicing reduces the chances of fraudulent invoices, as invoices are delivered through secure channels, providing confidence in their legitimacy.
For governments responsible for taxation and oversight
Governments gain improved control and transparency with e-invoicing. By using verified digital networks, e-invoicing reduces tax evasion by ensuring all business transactions are traceable and accurately reported. Governments benefit from real-time visibility into invoicing data, which enhances their ability to monitor compliance and identify discrepancies early.
E-invoicing also simplifies financial reporting processes, helping governments reduce administrative costs while improving the accuracy and speed of tax collection. This level of transparency allows governments to close tax gaps and increase fiscal oversight, ensuring that businesses comply with national and regional tax laws.
To learn more about the impact e-invoicing can have, watch our video: Who benefits from e-invoicing?
The state of e-invoicing around the world
Thanks to several growth factors, e-invoicing is rapidly becoming the global standard for secure and transparent financial transactions. Governments are leading the charge, pushing businesses to adopt e-invoicing to improve efficiency and compliance. Key sectors like manufacturing, transportation, retail and telecommunications are seeing widespread adoption as e-invoicing simplifies complex billing processes.
Europe
Europe has been a frontrunner in e-invoicing adoption, with countries like Norway, Finland and Sweden mandating its use in business-to-government (B2G) workflows. This push is expanding into the business-to-business (B2B) space as companies realize the operational benefits of e-invoicing. Italy has gone a step further, mandating e-invoicing for B2G, B2B and even business-to-consumer (B2C) transactions, setting a new standard for transparency and fraud prevention.
Latin America
Latin America is a global leader in mandatory e-invoicing. Brazil was one of the first countries to implement e-invoicing regulations, requiring all businesses to use electronic invoices to combat tax fraud and streamline reporting. Mexico and Chile have followed suit, making e-invoicing compulsory for most transactions, significantly improving tax collection and reducing errors in cross-border trade.
Asia-Pacific (APAC)
In the APAC region, China requires businesses involved in cross-border trade to comply with its national system for invoicing, reporting and e-signatures. These regulations ensure that companies operating in China follow stringent tax and invoicing laws, helping streamline international transactions.
Australia also has mandates for businesses working with government entities to use e-invoicing. Local governments, such as those in New South Wales and Queensland, have adopted similar measures.
United States
In the U.S., e-invoicing is gaining popularity in the B2B sector. While there are no federal mandates yet, the U.S. government has signed a joint declaration with the E.U. to improve the alignment and interoperability of e-invoicing. As more businesses discover its efficiency and accuracy benefits, e-invoicing is expected to grow in the U.S., especially as projects to build B2B invoicing networks gain traction.
To learn more about how e-invoicing makes it easier to conduct business across borders, watch our video: Electronic invoicing and global commerce.
The role of e-invoicing in invoice automation
While e-invoicing focuses on the electronic delivery and receipt of invoices, it lays the groundwork for broader invoice automation initiatives that benefit both accounts payable and accounts receivable. Because e-invoices are delivered and received digitally, they reduce the need for manual data entry and minimize the risk of errors that are common in data entry. But this is just the beginning.
When combined with broader invoice automation solutions, e-invoicing helps businesses automate several steps of the AP process, while streamlining several core functions:
- Capturing and validating invoice data
- Matching invoices to purchase orders and receipts
- Guiding invoices through automated approval workflows
- Assigning general ledger codes based on predefined rules
- Initiating payments for approved invoices
Similar opportunities exist to leverage invoice automation in accounts receivable (AR). Automating the order-to-cash (O2C) process can streamline everything from order entry to payment collection, speeding up cash flow and improving accuracy. Using configure, price, quote (CPQ) software adds to these benefits by automating pricing, quotes and product configurations to make the sales process faster and more accurate.
Starting with e-invoicing helps you take full advantage of broader automation solutions, which ultimately frees up time, reduces costs and improves financial accuracy for your finance team. As your business grows, e-invoicing and invoice automation can help it scale without reverting to manual processes, setting the stage for long-term efficiency and compliance benefits.
Why is it best to perform e-invoicing and invoice automation within NetSuite?
Integrating both e-invoicing and invoice automation directly into your NetSuite instance offers distinct advantages. By handling both functions natively within the ERP, you can eliminate the need for external platforms and disjointed workflows, leading to smoother operations and better financial control.
Some of the specific benefits of performing e-invoicing and invoice automation within NetSuite include:
- Real-time tracking and visibility: Gain full visibility into invoice status, from receipt to payment, with real-time tracking that allows finance teams to monitor and manage cash flow more effectively.
- Multi-currency support: Easily handle cross-border transactions by managing invoices and payments in multiple currencies, ensuring compliance with international standards.
- Improved accuracy and reduced manual intervention: By removing manual processes from invoice handling, businesses can reduce errors and improve the accuracy of financial data.
- Advanced reporting capabilities: With all data centralized in NetSuite, finance teams can generate detailed reports on invoice processing, payment trends and financial performance, helping leadership make informed decisions faster.
By integrating e-invoicing and invoice automation directly within NetSuite, businesses create a seamless financial operation that reduces delays, minimizes errors and improves cash flow management – all while scaling to meet the demands of a growing business.
For a deeper dive, check out our article on AP automation in NetSuite.
New technologies that are improving invoice automation
Technology advances are quickly transforming invoice automation and making virtually every step of an invoice’s journey faster and easier, while improving accuracy and compliance.
- Data capture and extraction: Artificial intelligence (AI), often in combination with optical character recognition (OCR), automatically reads and extracts information from invoices including invoice numbers, amounts, dates and vendor information. By doing this, AI eliminates the need for manual data entry, reducing errors and speeding up the process.
- Data validation and verification: Once the data is extracted, AI can assist with three-way matching to cross-check it against purchase orders, contracts or historical data. It ensures information like the amounts, tax details and terms match, flagging any discrepancies for review to improve accuracy and prevent fraud.
- Approval automation: Automation allows you to create predefined business rules that guide the invoice approval workflow. For example, invoices that meet certain criteria (such as being under a specific amount or matching a purchase order) can be automatically approved, while others can be routed to the appropriate personnel for further review.
- Compliance: AI-driven systems can monitor invoices for potential compliance issues. By analyzing patterns in invoice data, AI can detect anomalies, such as duplicated invoices or invoices from unverified vendors, and flag them for further investigation.
- Predictive analytics and reporting: With AI, you can analyze historical invoicing data to provide insights and predictions, such as identifying trends in payment behavior or forecasting cash flow needs. This can help you improve financial planning and make better decisions.
- Machine learning for continuous improvement: As AI systems process more invoices, they grow better at recognizing patterns and become more accurate. And since machine learning algorithms adapt over time, they become more efficient at handling exceptions, validating data and detecting fraud.
How can you get ready for e-invoicing?
If you’re planning to implement e-invoicing as part of a broader invoice automation initiative, follow these steps to ensure a smooth and compliant transition:
1. Assess your current systems
Start by evaluating your existing invoicing systems and determining their compatibility with e-invoicing platforms. Solutions like ZoneCapture are built to work natively within NetSuite, offering a fully integrated approach to AP automation. If you’re unsure of your systems’ readiness, consider consulting with an expert to help identify the scope of the project and how e-invoicing can be seamlessly integrated.
2. Work with a consultant and run tests
We recommend working with a consultant familiar with e-invoicing to understand the technical details, such as how to send invoices to customers and how the data will be processed. Set up a sandbox or test environment where you can run e-invoices and catch any potential issues before fully deploying the system.
3. Educate yourself on country-specific regulations
Before going live, ensure you are familiar with the e-invoicing guidelines specific to your country. For example, the PEPPOL framework is a widely used standard for managing e-invoices, adopted in over 30 countries across Europe, Asia and the U.S.
Technical considerations: Ensuring standardization and security in e-invoicing
As part of your e-invoicing implementation, it's essential to consider the technical frameworks that deliver invoices between systems. Different payment networks and countries may have variations in how invoice data is structured and transmitted, so ensuring standardized data and secure formats is key.
- Standardized Data: E-invoicing relies on structured data formats that are readable by both sending and receiving systems. Common formats like the full e-invoice and simplified e-invoice ensure that all necessary information including VAT numbers, invoice dates and product details are included and processed accurately.
- Secure Formats: Data must also be transmitted securely to avoid tampering or fraud. Common formats include electronic data interchange (EDI) and extensible markup language (XML), which securely transfer invoice data between systems. These formats ensure that invoice information is validated and cannot be modified once submitted.
4. Register with an e-invoicing network
Once you're familiar with the relevant regulations, your business will need to register with an e-invoicing network, usually through an online portal requiring tax identification information. This process typically takes 3-4 weeks. A consultant can help guide you through this step if needed.
5. Move from testing to production
After testing your e-invoicing system in a sandbox environment and ensuring compliance with country-specific guidelines, you’re ready to move to full production. From here, you can begin sending e-invoices and reaping the benefits of automation.
6. Align with internal processes and workflows
Finally, make sure your e-invoicing platform aligns with your internal processes. This includes integrating it with your existing workflows and training your team on the new system. Early buy-in from leadership and key stakeholders will help ensure a smooth transition and reduce any friction during implementation.
For more information, check out our video on how to implement e-invoicing.
Frequently asked questions about e-invoicing
How do I create an electronic invoice?
To create an electronic invoice, you’ll need to use an e-invoicing platform that automates the process. Enter the details or allow the system to automatically capture them, and once validated, the invoice is sent electronically to the recipient.
What is electronic billing and e-invoicing?
Electronic billing automates payment requests, while e-invoicing focuses on creating, delivering and managing invoices. E-invoicing allows for faster, more accurate processing.
What is the difference between EDI and e-invoicing?
EDI (electronic data interchange) is a legacy system for exchanging business documents. E-invoicing offers more flexibility, integrates better with modern financial systems and supports real-time validation and processing.
Who is eligible for e-invoicing?
Any business can implement e-invoicing, regardless of size. It’s especially useful for companies that manage large volumes of invoices or operate in regulated industries.
What is the difference between an invoice and an e-invoice?
An invoice is typically a paper or PDF document, while an e-invoice is a digital version based on structured data that can be processed automatically. E-invoices reduce manual work and errors, leading to faster processing.
What are electronic invoicing systems?
Electronic invoicing systems automate the creation, validation and delivery of invoices. These systems use OCR and AI to improve compliance and accuracy, while integrating with other financial systems for seamless operations.
Preparing for the future of invoice automation
As technology evolves, the future of AP automation and e-invoicing promises greater efficiency, accuracy and security. Advancements in AI, machine learning, blockchain and global standardization will drive several key developments:
1. AI and machine learning
AI will take on more complex tasks like real-time data validation, fraud detection and predictive analytics. It will enhance the accuracy of OCR in e-invoicing, reducing the need for human input, while streamlining invoice matching and approvals.
2. Global standardization and compliance
As more countries adopt e-invoicing mandates, global standards like PEPPOL will simplify cross-border transactions and tax compliance. Real-time tax reporting will become more widespread, improving transparency and reducing fraud.
3. Full invoice-to-pay automation
Payment automation will integrate seamlessly with e-invoicing, creating a fully automated invoice-to-pay process. This will improve cash flow, decrease manual intervention, reduce errors and accelerate payment cycles.
4. Blockchain for security
Blockchain technology will increase security and transparency by creating tamper-proof records of transactions. This will reduce fraud, enhance compliance and provide a clear audit trail for invoices and payments.
5. Touchless AP processes
We’ll see more touchless AP systems where invoices move through receipt to payment without manual intervention, helping finance teams focus on strategic decision-making instead of repetitive tasks.
The journey to invoice automation starts now
As finance professionals like you prepare to modernize the invoice-to-payment process, e-invoicing cannot be overlooked as a first step. It not only makes invoice delivery fast, secure and accurate, but when integrated into a broader invoice automation strategy, e-invoicing reduces manual tasks for your team, provides structured data to your ERP and improves the visibility you have into payments. And as your business scales, combining e-invoicing with invoice automation solutions creates a streamlined and efficient financial operation that improves cash flow management, makes it easier to conduct international business and provides a solid foundation for long-term growth.
To discover how our AP automation solutions, including ZoneCapture, can streamline your invoicing workflows and drive efficiency, consult with an expert from Zone & Co today.
