What is an e-invoice? – Everything you need to know

What is e-invoicing?An e-invoice is an electronic version of a traditional paper invoice. It can be sent and received electronically, using a computer or mobile device.

E-invoices can offer many advantages over paper invoices, including the ability to track payments, send automatic reminders, and reducing the risk of lost or damaged paperwork.

In addition, e-invoices can help businesses save time and money by eliminating the need to print and mail invoices.

For these reasons, e-invoicing is becoming increasingly popular among businesses of all sizes.

E-invoices or electronic invoices as they are often called, aren’t really all that new of a concept. However, this doesn’t mean that many people can lack a bit of understanding around them.

Today we will be answering all the questions you have on the subject, and listing the benefits provided by e-invoicing.

What is e-invoicing?

E-invoicing makes use of accountancy software to issued, transmitted, received, and processed electronically. When being created they require specific document format types and remain digital throughout their entire life cycle, from the initial issuing to the eventual archiving.

Electronic invoicing can help to reduce overall workload by replacing manual tasks and minimising error.

What isn’t an e-invoice 

To fully understand what electronic invoices are, you will need to understand what they are not. For instance, not all types of invoices or digital invoices are recognised as e-invoices. Here’s a couple of examples of ones that do not make the cut:

PDF Invoices –

PDF invoices are not recognised as e-invoices, even though they are normally sent by email, as they cannot be processed automatically. This is because they are not typically sent in a structured format.

Paper Invoices –

Paper invoices are not issued electronically, so even though they are converted to a digital format, they are not recognised as a form of e-invoicing.

Advantages of electronic invoicing 

There are a large number of advantages to e-invoicing, which include the level of convenience they can provide a business and a customer with, the time-saving aspect they can provide, the reduced level of cost attached to them, and more.

Here is the full list of e-invoice advantages for you to consider:

Touchless operations: E-invoicing empowers the computerisation of tedious and blunder-prone assignments such as data entry, coordinating and approvals so you can redistribute staff to more important tasks.

Increased cash flow: By removing paper work and manual errands you can improve your cash flow levels and maintain a higher profit margin. This will also free up time for your employees to complete more important things on a daily basis.

Secure document and data exchange: Encrypted document transfers, digital signatures and secure networks all make e-invoicing the most secure way of sending and receiving invoices. There’s likewise no danger of documents being lost via the post office or ending up in someone’s junk email folder.

Real-time delivery and processing: View live conveyance and handling status of records on cloud-based platforms or straightforwardly from your ERP.

High-quality data: E-invoicing allows you to get to and dissect line level information that drives business development through better monetary and obtainment choices.

Reduced levels of error: Automated receipt approval and enhancement help guarantee only correct value-based information enters your ERP framework. Less disparities mean shorter process durations and better business relations.

Track and traceability: E-invoicing naturally tracks exchange history and the entire journey of your invoice; thus, you don’t need to invest energy doing it physically.

Harmless to the environment: E-invoicing not only assists you with bringing down paper use and CO2 outflows; this maintainable exertion additionally brings down task costs, prompts higher profit margins, and makes a straightforward, dependable brand reputation.

Satisfy lawful prerequisites: E-invoicing with the right service provider guarantees you are consistently up to date and agreeable with B2B and B2G charge and archiving enactment.

Remote work-prepared: E-invoicing errands can be finished from anyplace without the requirement for extra assets like printers, scanners or the postal services.

As you can see, the advantages awarded to any business venture utilising e-invoices are very much worthwhile. If you begin to use this format your invoicing standards will remain high, the amount of cost and time will become lowered, and your trading partners will appreciate the electronic format you now use, as it is more convenient for them to deal with.

Is e invoicing mandatory?

E invoicing is an electronic way of sending invoices, and it is becoming increasingly common in businesses of all sizes. There are many benefits to using e invoicing, including the ability to track payments, save on paper and postage costs, and speed up the payment process.

In some countries, e invoicing is even mandatory for certain types of businesses. Whether or not e invoicing is mandatory in your country, it is definitely worth considering making the switch to this more efficient way of doing business.

How e-invoicing differs from traditional invoicing

Unlike traditional paper-based invoices that involve manual creation, printing, and mailing, e-invoicing leverages digital technology to streamline the entire invoicing cycle. With e-invoicing, invoices are generated electronically, often using specialized software or platforms, and sent directly to recipients via email or electronic data interchange (EDI).

This eliminates the need for physical paperwork, reduces administrative costs, and speeds up the invoicing process. Furthermore, e-invoicing enables seamless integration with accounting systems, facilitating automatic data entry and reconciliation, thereby minimizing errors and enhancing efficiency.

Additionally, e-invoices can be easily archived and retrieved electronically, providing a more organized and accessible record-keeping system. Overall, e-invoicing offers businesses a more efficient, cost-effective, and environmentally-friendly alternative to traditional invoicing methods.

How do I create an electronic invoice?

Creating an electronic invoice is a simple process that can save you time and money. By using an electronic invoicing system, you can streamline your billing process and avoid the hassle of paper invoices. Here’s how to get started:

First, you’ll need to choose an invoicing software or service that meets your needs. There are many options available, so be sure to do your research to find the one that’s right for you. Once you’ve selected a software, create an account and proceed to set up your business information. This will include your company name, logo, contact information, and payment terms.

Next, you’ll need to add your products or services to the software. Be sure to include all pertinent details such as pricing, descriptions, and any applicable taxes.

Once you’ve added all of your items, simply send your invoices out to customers via email or directly through the software. And that’s it! You’re now ready to start providing electronic invoices instead of paper ones.

Is now the time for you to begin e-invoicing?

We see no reason why it shouldn’t be. You are already aware of the benefits it provides you with, but if you are in need of even more reasons, we can help you out.

Many countries including the United Kingdoms, making tax digital scheme have begun to make e-invoicing mandatory by law, so your country could be the next to do so. Be ready for this to happen by making the change as soon as possible.

If you begin to use electronic invoices, you may be recognised as a forward-thinking business venture, and one that always has its customers and clients in mind. By utilising e-invoicing you will create a more convenient service for everyone that’s involved.

Don’t worry about having to let staff go if you decide to proceed with e-invoicing, as it will actually create more working opportunities than it’ll ever take away. Your company will be able to create skill-based roles, evolve existing ones, and keep in-house productions on the rise, rather than having to look for help elsewhere. As we have touched on previously, this will also make your remote workers more effective and flexible.


In conclusion, e-invoicing has emerged as a game-changer in the realm of billing and payment processes. Its ability to digitise and automate invoicing procedures brings numerous advantages to businesses, including increased efficiency, reduced costs, and improved accuracy. By eliminating the reliance on paper-based invoices and embracing digital technology, organisations can streamline their operations, enhance cash flow management, and establish stronger relationships with their customers and suppliers.

Furthermore, e-invoicing aligns with the broader trend of digital transformation, allowing businesses to stay competitive in an increasingly interconnected and fast-paced marketplace. As the adoption of e-invoicing continues to grow, businesses of all sizes can benefit from its many advantages, making it a vital component of modern financial workflows.

Business Finance specialist at Invoice funding | + posts

Seasoned professional with a strong passion for the world of business finance. With over twenty years of dedicated experience in the field, my journey into the world of business finance began with a relentless curiosity for understanding the intricate workings of financial systems.

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