What is e-invoicing?
E-invoicing, also known as electronic invoicing, is the exchange of invoice data between a supplier and a buyer in a “structured” format. The structured format allows an accounts payable (AP) receiving system to immediately understand each unique invoice field, to quickly begin the invoice processing cycle.
What is the e-invoice process?
Invoicing is a segment of the entire procure-to-pay (P2P) cycle. Invoicing starts only after a purchase order has been received, and depending on the terms of the delivery of the good(s) or service(s), the invoice may be sent at a later stage.
The purchase order is critical to the invoicing process as it outlines the terms of the purchase, including the cost, delivery and payment method agreed for the transaction. This clarity is essential and allows the transaction to move forward.
When the product delivers or the service has been provided, the e-invoice can then be raised and sent digitally. The vast majority of invoices are created with a net 30, meaning customers have 30 days to make the payment. This does, however, depend on the terms agreed between the buyer and supplier.
An invoice is issued, transmitted, received, processed and stored electronically using structured document formats, meaning everything is completed online and streamlined to enhance the entire process.