Webinar provided by Storecove on January 31, 2024
Challenges and current state of electronic invoicing (e-invoicing) in the United States. One notable challenge is the absence of a central government authority, at both federal and state levels, to establish and mandate a framework for e-invoicing. Unlike many other major economies, the U.S. lacks a federal Value Added Tax (VAT) or Goods and Services Tax (GST) system.
Currently, there are no e-invoicing mandates at the state or federal level in the U.S. Businesses in the country enjoy more commercial freedom in terms of the data elements and fields required on invoices subject to sales tax. Electronic Data Interchange (EDI) is used for invoicing, with 25 billion invoices issued yearly, but only 25% are electronic. There are over 250 e-invoice providers using various formats and subsets, leading to a complex and diverse environment.
The Digital Business Networks Alliance aims to address these challenges by establishing an electronic delivery exchange network for all commercial enterprises in North America, starting with the U.S. The alliance is an independent, not-for-profit organization with a 50/50 representation of service providers and customers. Their mission is to support faster payments across North America without the involvement of authorities.
The Exchange Framework proposed by the Digital Business Networks Alliance is a set of standards, policies, and guidelines to enable businesses to connect and exchange B2B invoices and documents efficiently and securely. The framework is designed to be easy to adopt within the current operating model and accounting systems, non-disruptive to Accounts Payable (AP) and Accounts Receivable (AR) workflows, payment method agnostic, based on open standards, and system agnostic, allowing electronic document exchange without changing existing systems. The goal is to achieve a network effect, with a tipping point around 30% adoption.