Tuesday, April 16, 2024

E-invoicing improves cashflow for SMEs

Australian Small Business and Family Enterprise Ombudsman Kate Carnell says e-invoicing is good for small and medium-sized businesses (SMEs).

Ms Carnell argues that it streamlines payments and improves cashflow, and therefore makes SMEs more productive.

She also welcomed the Australian Treasury’s public consultation on how e-invoicing could work best.

$28 billion over 10 years

“Around 1.2 billion invoices are exchanged in Australia every year,” Ms Carnell said. “So the potential benefit to the Australian economy in switching to e-invoicing is $28 billion over 10 years.

“The benefits of are significant for small businesses. It means quicker payments and reduced administration costs.

“Research shows it costs $30.87 to process a paper invoice, $27.97 per PDF invoice and only $9.18 per e-invoice. A significant saving.

“E-invoicing helps to eliminate processing errors as your core business details are stored online and can include a direct link to your bank account for payments.

“Research reports around 20 per cent of invoices today are sent to the wrong person and 30 per cent contain incorrect information, therefore delaying payment.

“E-invoicing also reduces the time from creating an invoice to getting paid, as the sending and payment are automatic. This increases business productivity.

“We’ll continue to advocate digitalisation, and its many applications, so small businesses can realise the benefits of participating competitively in the digital economy.”

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