blogs.tieto.com
Claes Lemnell

Are the Banks too late for the e-invoice Party? – Part 2

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Click here to read Part 1!

The Landscape

OK, we understand there are some potential upsides for both Banks and corporations. But how far have we come?

Let’s have a look on where we stand right now, is there a market or not for this?

 The total estimated market value for the entire Financial Value Chain (Order-2-Cash, Purchase-2-Pay) in Europe is € 200 Billion annually and less than 10% of this is put into practice!

OK, so there is a market..! But what is actually done, by who and for whom?

Electronic invoicing on the EU agenda

The Digital Agenda is Europe’s strategy for a flourishing digital economy by 2020. The European Commission is focusing its efforts on removing barriers to the broad-scale adoption of electronic invoicing in Europe and the four key priorities on this topic are:

  • Ensuring a consistent legal environment for E-invoicing
  • Achieving mass market adoption by getting SMEs onboard
  • Stimulating an environment that creates maximum reach between trading partners exchanging invoices
  • Promoting a common E-invoicing standard

Beyond E-invoicing

After establishing E-invoicing, the next automation steps soon follows:

  • Replace traditional procedures along the procurement supply chain with electronic and automated processes
  • Replace traditional procedures along the financial supply chain with electronic and automated processes

RTE – Real –Time Economy

  • Full FVC

RTA – Real-Time Audit

  • Enables Tax authorities to audit invoice before goods are shipped by suppliers

 My humble conclusion on this; since the “market share” for e-invoice is still below 10% – no one is “too late” for this… Here in Sweden we – Tieto – provide white label e-invoice solutions for Banks allowing them and their corporate customers to send & receive in any channel (e or print) and with any-format-in, -any-format-out. I believe that the process starts with Order-to-Invoice-to-Payment, with a “straight-through-process” allowing for add-on services like supply chain finance; factoring and reversed factoring. Combining all these services (as Tieto does today) is absolutely something for the Banks to take part of as this is close to their core business – Payment, Loans and Funding. At least in Sweden, Banks play a huge role of converting the large SME segment into the “world of e” within the FVC – Financial Value Chain!

Having a meeting with one of the largest Banks in Sweden, discussing further development of their eInvoicing service; they clearly stated that the main reason for the Bank to develop and manage their own e-invoicing service, is that it’s so close to their core businesses; Payment, Loans & Funding, that’s it’s so essential for them to have “their own” service rather than acting as “consultants”. Hence, this service leads them straight to their own “core business products” (as mentioned above) with a smoother straight-through-process and a better margin.

I believe it’s essential for the Banks (like all other e-invoice VAN’s end vendors) to extend their roaming agreements leading towards a larger and smoother “market landscape” for all – not at least the end user/customers!

With a greater roaming network – we are all building the infrastructure and secure the possibility to increase the total market share of e-invoicing!

Ps. did you know that European Banking Association declares that 2 500 trees need to be cut down to deliver 1 000 000 paper invoices?

 
 
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