AutomationE-invoicingFinancial management processesRegulations and standardsSecurity and compliance

E-invoicing vs. traditional invoicing: why it’s time to make the switch

2 min read | 15.1.2024

Invoicing has always been a fundamental part of doing business, from the earliest days of trade to today’s modern companies. As with many core practices, invoicing is now being transformed by new technologies, going fully digital. E-invoicing isn’t just a passing trend; it’s a smarter, faster way to manage invoices, that cuts down on paperwork and speeds up transactions. Sending invoices electronically makes the whole process more efficient and accurate, and it’s even backed up by changes in regulation. 

Not convinced yet? Let’s dive deeper into the differences between traditional and electronic invoicing, and why we think you should make the switch already today.

Quicker payments, quicker success: snail mail could never

In today’s world, where instant communication and real-time decision-making are the norm, the traditional pace of invoicing just can’t keep up. E-invoicing brings the speed and efficiency your operations need, leaving paper and PDF invoices in the dust. 

Let’s try a simple exercise: consider the amount of time your company dedicates to scanning, printing and mailing invoices. Are we talking minutes, hours, or even days? Now imagine allocating nearly all of that time to other tasks that benefit your business. Sounds pretty great, right? The most significant advantage of e-invoicing is its rapid delivery and receipt. The days of waiting for the mail to arrive or digging through endless email attachments are over – instead, e-invoicing enables your business to send invoices in real-time, dramatically reducing the wait time from service delivery to starting the payment process. 

But it’s not all about speed. Automation, a core component of e-invoicing solutions like Maventa, takes your invoicing efficiency to the next level. Thanks to their structured format, e-invoices can be processed up to 3.5 times quicker than paper invoices, which can vary widely in format and size. Switching to e-invoicing will not only improve your cash flow but also reduce the time you spend chasing payments and collecting debts. 

Maria Harinen, Commercial Product Director at Maventa, explains this further.

“The structured format of e-invoices isn’t just a detail – it’s a game changing quality. These standard formats enable the development of AI-based solutions, such as identifying  inconsistencies and anomalies in invoice flows and alerting users about discrepancies or price changes,” she says.

Manual data entry mistakes, lost mail, or misplaced paper invoices can lead to costly errors that inflate your company’s expenses unnecessarily. “E-invoicing brings in precision and the ability to make instant corrections,” Harinen adds. 

Essentially, e-invoicing isn’t just about replacing paper with pixels; it’s about leveraging technology to boost operational efficiency and precision.

From data clutter to actionable insights

Traditional invoicing relies heavily on manual work, from data entry to sorting through paper and email invoices, often leading to higher risk of errors and a lot of wasted time. Wouldn’t it be so much nicer to have all your invoicing data and details in one place, say, in your ERP or accounting system? E-invoicing grants you the access to valuable, data-driven insights through structured data. No more manual input, no more unnecessary errors, and so many essential resources freed up to do more valuable work.

As mentioned earlier, structured data offers the opportunity to utilise new, AI-driven solutions as part of your business even more effectively. These technologies offer benefits that extend well beyond identifying errors or inconsistencies; they allow you to go much further into predicting cash flows and can even offer actionable business insights. 

Maria Harinen points out that sending an e-invoice offers significant benefits to the recipient too. 

“The key benefits include automatic upload of the invoice into the recipient’s system, which simplifies the approval, payment, and accounting workflows. And minimises errors on their part too.”

Harinen continues, “E-invoicing operators already offer technology that not only checks invoices for accuracy but also converts them into formats that are easily processed. This is especially crucial in business environments where invoices move through various softwares into multiple different markets.”

Good for the business, great for the planet

Nowadays it’s widely recognized that the everyday choices businesses make have a direct impact on the environment. Adopting e-invoicing isn’t just a smart move for saving money and time; it’s a major step towards becoming a more sustainable and eco-friendly business.

Let me give you an example. The entire lifecycle of a paper invoice contributes to your company’s carbon footprint. This means that every time a paper invoice is created, sent out, delivered and stored, that number increases. To give you an idea, a single paper invoice can produce about 450 grams of CO2e. But, switch to an electronic invoice and that number drops to just 150 grams. When you multiply that by the amount of invoices you send each year, we’re talking about a pretty significant reduction.

Some European countries, such as Finland, are already reaping the benefits of e-invoice adoption early-on. An impressive 92% of Finns handle their invoices online, with 75% embracing e-invoices. 

A 2018 report by Finance Finland highlights that beyond making banking and business operations more efficient, e-invoicing has also greatly decreased environmental harm. By automating financial management with e-invoices, companies can reduce their carbon footprint by a whopping 80-90%.

While the financial gains from switching to e-invoicing are clear, the environmental benefits really underscore its necessity, even on a global level. Choosing e-invoicing does more than just streamline your processes: it gives you the opportunity to showcase your commitment to a shared cause. 

Security? Compliance? Never worry about it again

Protecting sensitive information and meeting legal standards is not only important, but essential. E-invoicing, at its core, perfectly combines these two critical elements.

E-invoicing operators work hard on utilising advanced encryption methods to keep data safe during transmission and storage. Sending invoices securely is obviously important, but so is ensuring that they are stored under the tightest security. Operators like Maventa keep up with the latest standards and do the hard work for you behind the scenes. Risto Collanus, Service Owner at Maventa puts it simply: “Maventa follows strict privacy and security protocols, including the Visma VCDM certification, and complies with regulations like GDPR. We encrypt customer data and regularly test our systems to ensure security.”

The regulatory landscape surrounding e-invoicing can feel complex and full of mandates that are difficult to follow. With each government updating their laws at their own pace, keeping up can be particularly challenging for businesses that operate beyond their home country’s borders. The simplest strategy for your business to stay compliant is to choose a financial management software or an ERP that has partnered up with a reliable and trust-worthy e-invoicing operator. This way you won’t miss out on any opportunities to streamline your business but also keep your business on the right side of the regulatory field.

Available and scalable – always in line with your business

In the hustle of your everyday business, wouldn’t it be great to access your essential business tools and data anytime, anywhere? E-invoicing gives you the freedom to manage, send, and receive invoices without being restricted by location or time. Picture yourself effortlessly checking invoices while relaxing on a beach or your accountant wrapping up work during the late hours; e-invoicing ensures that your financial transactions are always just a few clicks away.

One of the less obvious advantages of e-invoicing is its ability to handle volumes effortlessly. To put it simply, it grows and scales together with your business. Sticking to traditional invoicing methods can quickly become a bottleneck and hinder your efficiency. E-invoicing architecture however, is designed to support your expanding needs without ever encountering a limit to your invoicing capacity. This makes e-invoicing a powerful tool for businesses of all sizes. Whether you’re a startup or an established global corporation, e-invoicing adapts and grows together with your business.

Take full control of your transactions

Getting started with e-invoicing isn’t just about catching up with the latest technology trends. It’s about taking full control of one of the most important aspects of your business: your transactions. It’s a smarter, more secure, and environmentally friendly way to handle your financial operations.

Not sure how to get started? We recommend having a chat with your software provider to see if they already offer e-invoicing solutions. If they don’t, feel free to tip us off about your ERP software, and we’ll make sure you won’t be missing out on e-invoicing services in the future.

Taru Kuusisto

Taru Kuusisto works in the Maventa marketing team. She loves crafting insightful content that both informs and engages readers, bridging the gap between complex technologies and everyday business.