As a member of several European commissions and operators associations with a focus on electronic invoicing standardization (EESPA, CEN), and Pan-European solution expert in financial process optimization, Itella Information offers a first-hand insight on e-invoicing in many European countries, in B2B and B2C areas, supporting this year’s Billentis report.
Due to globalization, shift to electronic is inevitable, with an expected market penetration of above 50% in 2017 for the B2B/B2G/G2B segment, and of above 50% for the B2C segment in 2020. Corroborated data available in this year’s Billentis market report edition and Itella’s own market analyses carried out in the past 2 years, point out to a clear increase in the adoption rate of e-invoicing, phenomenon which had its start in the B2C area. Also, the countries that became early adopters of e-billing, notion by which we understand electronic invoicing for consumers segment only, now tend to embrace electronic invoicing in the B2B area, too. Norway and Estonia offer two relevant study cases in this direction, in Europe.
By 2010, in Estonia, 25% of invoices issued for consumers were received electronically, through the portal www.arved.ee (managed by Itella Information). Before the portal became operational, the e-invoices issued for consumers were only about 4.5% in Estonia, in 2004. After the first 5 years of operation, the e-invoice portal successfully quadrupled the volume of invoices sent, received and paid electronically. Related to the interest for e-invoicing in the B2B area, the percentage of enterprises using electronic sales and purchase invoices was also high by 2010, of over 80%. Estonia’s example is relevant because of the time rate adoption and also because it represents a pro-active model.
Norway’s case is another interesting example, since VAT compliant B2B e-invoicing was legally allowed in Nordic countries since around year 2000. But Norway registered a high B2C adoption rate at first, and only in the past few years can we speak of an increasing B2B adoption rate. In 2010, according to Itella’s Invoicing Survey in 16 European Countries, the electronic channel preferred by Norwegian consumers for receiving invoices was the web, mainly for internet banking use. But starting 2012, Norway is to implement mandatory B2G e-invoicing - by July 1st. From a B2B perspective, companies in Norway registered a notable preference in using electronic purchase invoices, of 74%, whereas sales invoices only 22%, in 2010. Following this year’s public sector initiative (compulsory B2G e-invoicing), an increase of the overall B2B e-invoicing transactions in the order-to-cash segment is also expected, as e-invoicing enables improved costs control and financial process transparency.
Having successful examples of electronic invoicing adoption in Europe, the process is now expected to speed up in the B2B cases and to include SMEs, for which the rollout model may vary considerably. Nevertheless, a wide range of solutions already exists and is ready to answer any company’s demands, regardless the size of the company.
- Being a leading company on the market, Itella Information shares expertise and enables development, in a trans-national approach. Interoperability creates more value in local and global infrastructures than closed networks. With more than 20 years of experience in the financial business process outsourcing, Itella Information is committed to delivering constant innovation for invoicing operations and processes, in B2C and B2B customer areas, on a cost efficient basis and improved service quality. Our direct experience in many European countries is a clear indicator of the change. We have already reached volumes of 150,000,000 e-transactions per year, so we are optimistic about the adoption rate. The sooner the common standards will be agreed upon, the faster and easier the experience of electronic invoicing will be, says Heikki Pulli, Business Development Director for E-Services within Itella Information.
While there are still many challenges on the European market, due to country specific and to each business industry, providing more efficient invoicing processes must always secure healthy relationships all throughout the financial supply chain.
- This is the reason why our focus right now is on building more opportunities, thus contributing to e-invoicing infrastructure development and standardization. As more projects on e-invoicing have to be pushed, several areas are being subject to optimization. The first step has to be achieving standardized and more automated financial processes and sub-processes. Also, companies evaluating the possibility of adopting e-invoicing will soon find out that Financial Processes Optimization, As a Service, represents a more costly and operationally efficient solution, Itella Information representative added.
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Head of Communications, Itella Information
+35 85 03 84 31 62
Tiina.i.Harkonen (at) itella.com
Itella Information provides financial process services and cash flow automation solutions that improve its customers’ profitability and agility. Our services cover all aspects of financial management: from purchase order to payment and from sales order to management of incoming cash flow, plus a full range of accounting and payroll services. With the benefits of scale, automated processes and best practices, we ensure that our customers’ financial processes are managed in an efficient, professional and flexible manner.
Itella Information has direct operations in 11 European countries and several other countries through partner network. Itella Information is a business line held by Itella Group. Itella Information employs more than 2,000 professional staff. In 2011, it had a turnover of EUR 273.7 million. For more information, access www.itella.com/information.