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How to Transition to Paperless Invoicing: A Step-by-Step Guide

Paperless Invoicing
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Minimalism is all the rage these days and for a good reason, it gives one freedom from clutter and time-wasting activities. More than a lifestyle, minimalism is a mindset. But how does it apply to business? Transitioning from manual paper based invoicing processes to Paperless Invoicing is one way in which business can embrace minimalism. 

Paper based processes create a lot of clutter, paper waste (which is not to mention not environment friendly) and an added task of filing and maintaining the entire paper trail, more so in processes like invoicing. Businesses are therefore embracing digitization for key-operational processes such as human resource, finance, procurement and more – Paperless Processes is the future.  

One of the key processes that  involves a lot of paper work is invoicing. Transitioning to a paperless invoicing or E-Invoicing (electronic invoicing) can help business streamline processes and make it accurate and agile.

With more and more companies striving to automate and digitize their invoice processing and go paperless, the Global E-invoicing market is projected to be worth US$ 35.9 billion by 2028.   

Are you as a business still stuck with manual paper based invoicing and grappling with endless challenges associated with it? It’s time to move to Paperless Invoice Processing and make it streamlined, efficient, and agile. Wondering where to start? In this blog we guide you step by step on how to transition from Paper Invoicing to Paperless Invoicing. So, let’s get started. 

What is Paperless Invoicing?

Paperless invoicing aka E-invoicing refers to the method of creating, sending, receiving, and processing invoices through a digital medium such as email or Invoice Processing Software. As opposed to paper invoicing that rely on physical documentation, E-invoicing leverages electronic systems and automation software to handle invoice processing.

Invoices are created electronically and sent to the concerned party via digital channels such as an email, online portal, or an electronic data interchange system.  

Unlike paper invoicing, paperless invoicing ensures that the invoices created have a standardized structure and format so as to seamlessly integrate with accounting software or any other financial management tools a business may be using. 

Paperless Invoice Processing 

Invoice processing is a series of steps starting from receiving an invoice from a supplier and ending with paying them. The invoices received could be hard copies (printed on paper) or a softcopy received on email as a PDF, either was the invoices have to be entered into a company’s accounting system either manually or automatically. Invoice processing involves the following steps: 

  • Invoice receipt 
  • Invoice verification 
  • Invoice approval 
  • Invoice payment 

Paperless invoice processing entails migrating all manual paper based accounts payable processes to an electronic or digital process comprising invoicing, data storge, invoice matching and approvals, compliance with tax laws, and more. Zycus, provides an intelligent AI-powered E-invoicing Software which enables companies to implement a touchless invoice processing system portal based invoice generation, three way matching, and adherence to compliance capabilities.

Businesses can create, send, receive, and manage their entire invoice processing electronically eliminating the need for paper-based invoicing and the cumbersome task of manual data entry. E-invoicing software enables a business to optimize invoice processing costs, shorten the payment cycle, and make invoicing more efficient. 

The future of accounts payable is paperless.

Read this whitepaper by Zycus to navigate the transition from paper based to paperless invoicing and transform your accounts payable into a cost-effective function. 

Benefits of Paperless Invoicing 

1. Efficient Processes 

Manual paper invoicing means your team spends a considerable amount of time doing the same tasks over and over. Manually entering invoices is not only time-consuming but also fraught with errors such as duplicate entries, missed entries, incorrect information entered, human oversight, and man such errors.

Moving to a paperless invoicing means eliminating redundant and repetitive routine tasks by automating them, reducing or eliminating human errors which makes the overall invoice processing cycle faster and efficient.  

By going paperless and investing in an AP automation software, companies can process their invoices 4.11x times. 

2. Cost-effective 

The cost savings of a paper vs paperless invoicing is something businesses often fail to understand. Not only do you save on costs like printing, cartridges, paper you also save on the costs of storage facility which you will have to maintain to store all the files and paperwork. Not to mention the labour costs and time spent on systematically filing these documents.

The time and manpower can be utilized on more important business functions. By switching to a paperless invoicing systems a business can save up to 49% on invoice processing costs. Now that’s some food for thought.  

3. Streamlined Workflows 

Digital paperless invoicing streamlines and expedites invoice processing time. Invoices received can be matched as per internal policies and lined up for approval, approving authorities get system generated alerts ensuring that approval are done on time. All compliances can be adhered to and any exceptions flagged in the system.

Timely or early payment of invoices can enable businesses to leverage early bird discounts which in turn can positively impact cash management and supplier relations. From the suppliers standpoint POs can be converted in to invoices and sent on time, any disputes whatsoever can be resolved in real-time. All of this together makes your invoice processing streamlined and in the long run helps optimize costs. 

4. Sustainable Business Practice 

Switching to paperless invoicing implies saving a lot of paper and other physical resources like files and other stationery. Not only is this good for the business but also for the environment at large, given the carbon footprint a business is able to reduce by eliminating paper use and physical storage facilities. 

Switching to a cloud-based AP Automation Software like Zycus helps businesses save precious real-estate, documents can be accessed anytime anywhere with ease, and there is no risk of paperwork getting lost. 

Disadvantage of Paperless Invoicing 

Despite being a convenient option, paperless invoicing requires internet access. Though the internet penetration is deep, as per reports 5.18 billion people globally have access to the internet as of 2023. This implies that nearly 1/3rd of the global population still has no access to the internet and therefore implementing paperless invoicing is a challenge. 

Paper vs Paperless Invoicing 

1. Format and Storage 

Paper invoices as the name suggests are invoice hard copies printed on paper and need to be properly filed which means they occupy storage space. Paperless invoice is a digital or softcopy which can be stored in a computer or on cloud and hence does not occupy any space. 

2. Time and Mode of Sharing 

Creating paper invoices is a manual and time-consuming process more so when transaction volumes are high. Next is sending the invoice which must be done via fax, courier, or post. Another alternative is to scan the paper invoice and share the invoice via email. 

On the contrary digital invoice can be created quickly thanks to the ready to invoice templates most E-Invoicing software come with. The vendor can check the invoice on the system itself in real-time once its raised. 

3. Accuracy 

Since paper invoice is created manually the chance of human error is high and any mistake cannot be rectified. The chance of human error with paperless invoicing is bleak and errors if any can be easily rectified/edited in the system. 

It’s a well-established fact that in today’s digital era paperless invoicing is the way forward, however the transition needs to be well planned with clear objectives in mind. Let’s walkthrough a detailed step-by-step process of transitioning from paper to paperless invoicing. 

Steps to Transition to Paperless Invoicing 

1. Define your Goals 

As a first step clearly define your short- and long-term goals. Make sure the goals set are measurable and realistic. Set KPIs (key performance indicators) like average approval time, supplier discounts captured, days payments outstanding to review periodically. 

2. Set Expectations 

Resistance to change is a given and basic human nature. Many employees might resist automation and fear that they might end up losing their job. Communicate to them what to expect and take them onboard by explaining how the initiative would simplify their tasks and make it more efficient. If you plan to automate supplier onboarding, they need to be informed about this change as well.  

3. Standardize Workflows 

Create a standardized workflow, this is the most crucial step when transitioning from a manual process to automation. Make sure to include the tiniest of details like general ledger coding when laying out the workflow. Involve executives who actually do the data entry of invoice in the systems to ensure no detail is missed out. 

4. Identify E-Invoicing Software 

Now that you have the entire process laid out, identify a software that fulfils all your requirements. The success of paperless invoice processing will only be successful if you implement a software that meets your requirements and can be customized to accommodate your unique business needs. 

5. Digitize Existing Data 

The next step is to feed all existing paper data (purchase order,  invoices, and any other paper trail) into the identified software. Identify team members and create a plan with timelines to accomplish this mammoth task. 

6. Integration with Existing Systems 

Your E-Invoicing software needs to be connected with your ERP, Supplier onboarding portal, and other relevant systems already in use. 

7. Training Employees 

Perhaps the most important step, train your employees on the new systems. A system is only as effective as its users. People need to be trained and made comfortable on these systems else they might be tempted to go back to old ways of doing things which will make the entire transition futile. 

Zycus AI-Powered E-Invoicing for the Win 

Experience the true power of touchless E-Invoicing with Zycus AI-powered Accounts Payable Automation Software and make your invoice processing faster and efficient. Reduce the average time to generate an invoice by 53% and cost per invoice by 65%.  Harness the power of Zycus AI/ML powered invoice matching and approval capabilities which ensure that all internal policies and compliances are adhered to. 

The Zycus Mobile Invoicing App ensures suppliers, buyers, and key stakeholders have access to invoices and other important information on the go. The e-Invoice Generation Solution ensures improved collaboration with suppliers, seamless integration with existing systems, accuracy, and regulatory compliance.

The Dynamic Discounting Software Workflow comprising an integrated supplier network platform, effective cashflow management flexibility, and intuitive dashboard provides a centralized view of all discount programs, enables users to approve early payment of invoices to leverage discounts, and also gives a view of available capital for early payments. Do more with Zycus E-invoicing software and embrace the paperless future. 

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Swagata Kumar having over 13 years of experience as a seasoned Product Marketing leader, developing and implementing effective Go to Market strategies for high growth B2B SaaS Products and Technology solutions. She bring with an unique and strong blend of experience across Product Marketing, Go to Market, Customer Marketing, Business Strategy, Sales Enablement and Business Development in B2B SaaS. Throughout her rewarding career, she have closely collaborated with sales leaders in diverse markets, enabling me to design and implement impactful campaigns that have significantly contributed to business revenue growth and market share expansion. As a result, She have developed an in-depth understanding of revenue-driven marketing strategies for B2B SaaS products in the US and EMEA regions. She expertise encompasses Product Marketing, Product Positioning and Messaging, GTM Strategy, Cross Functional Leadership, New Product Launches, Sales Enablement, Product Evangelization, Customer Marketing, Market and Industry Research, Competitive Benchmarking, Content Marketing,
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