Electronic invoicing used to be a B2B topic while B2G (business-to-government) was hardly mentioned. Over recent years, this has shifted drastically to the extent B2G electronic invoicing is catching most of the attention and investment in many countries.
This has been driven by 2 main reasons:
- First, governments also want to tap into the cost savings potential of e-invoicing. Most estimates show a 50-80% reduced costs of invoicing processing when electronic means are adopted (adoption in the EU estimates a processing cost per invoice of €1, down from €30 to €50 in some cases).
- Second, and maybe more importantly, governments want to set an example for B2B, following disappointing e-invoicing adoption growth rates albeit the huge announced benefits for the economy. They believe that once companies start e-invoicing with them, they’ll also do it among themselves.
This trend has been most prominent in Europe (with EU authorities mandating all member States to accept e-invoices no later than 2018 and promoting the PEPPOL technology) and in Latin America (where many governments imposed B2B as well as B2G driving fast adoption). Even the United States has now joined this trend in the last year by publishing an initiative for all government agencies to adopt a Federal Shared Service Provider (FSSP) as an eInvoicing solution by the end of 2018.
What does this mean for businesses?
First off, if your business does any work with these government entities, then these mandates affect you directly. You’ll need to ensure your business is ready to support electronic invoicing when the mandates go into effect.
Secondly, there’s no doubt that these initiatives will spill over into the B2B landscape. Because of these mandates, government entities will be the leading force of electronic document exchange as a standard for supply chains. Since this forces companies to adopt these methods, they will look for ways to leverage this new technology in other ways to distribute the cost impact. Moving from B2G to B2B is a natural evolution. It won’t be long before we’ll see most companies requiring electronic invoicing for all suppliers.
The future of B2G integration
Mandated eInvoicing will soon be a requirement for B2G relationships (if it isn’t already mandated). And the next step from there will be a step towards all B2B communication. Over the last few years, we, at Babelway, have worked hard to continually upgrade the Babelway platform to support our customers in their B2G e-invoicing initiatives. Let’s mention a few:
- It started with NHS (National Health Service) in the UK who imposed PEPPOL as the technology for the millions of supplier invoices. NHS has now qualified a few service providers, including Babelway, as PEPPOL providers of the Crown (sounds good, doesn’t it).
- In Belgium, our home, Babelway worked with the Belgian government to create a PEPPOL access point for all national public authorities. E-invoicing is now being rolled out and made compulsory by a growing number of administrations
- In Mexico, Peru and Chile, Babelway worked with Tradeshift and Trustweaver to provide compliant B2B e-invoicing solutions now trading millions of invoices
- In Luxembourg, Babelway also provides the PEPPOL access point of the public authorities
- In France, Babelway is getting ready for the mandatory use of Chorus, the e-invoicing solution of the French public authorities
If there is one thing we learned during this work is that, whatever efforts cross-national bodies put into standardizing and simplifying technologies, each government (a bit like large companies) comes up with slightly different requirements making it paramount for suppliers (and those helping them with invoicing solutions) to have a robust and flexible solution to handle electronic exchanges and compliance.
The way Babelway promises to help is to always support the various formats or connectivity requirements that any partner may impose on you. In such an evolutionary world, this is no small feat.