The Opportunity for E-Invoicing

And the Perils for Ignoring It
by Gareth Lodge, May 24, 2012
Global, Asia-Pacific, EMEA, Latin America, North America


The potential for e-invoicing has long been recognised by the banking industry. Even though volumes are steadily increasing, doubling in the last three years, the level of penetration is still below 10% in most countries. This report addresses how an industry promoting electronic payment types can use e-invoicing to make the leap into the 21st century of client servicing.

In a new report, The Opportunity for E-Invoicing, Celent looks at the reasons why e-invoicing has failed to gain traction in the banking industry. Much of the shortfall in effort and ensuing success lies in the fact that banks are being driven by business cases that require returns on investments in short timeframes. While e-invoicing can enable many opportunities, it is unlikely to satisfy those business requirements in the short term. Part of the problem that is that e-invoicing is widely misunderstood and often finds itself compared to areas such as supply chain finance, the financial supply chain, or e-billing. This report aims to define what e-invoicing is (and isn’t), why it lies at the heart of many of these areas, and why Celent believes e-invoicing could unlock many other benefits.

The US Department of Defense estimates that, by adopting e-invoicing, it has saved in excess of US$250 million per annum. The European Commission has estimated that the savings over a six-year period would be the equivalent of 1% of Europe’s GDP. The challenge for many banks is that, at first glance, these are savings for corporations and society, and not necessarily banks.

However, Celent believes that banks will ultimately benefit from these savings, and probably more than any other sector. But even more importantly, e-invoicing builds the platform for the digital client relationships of the future. By starting with the invoice, “queen” of all the documents that accompany a transaction, banks are enabling greater efficiencies in a vital part of the value chain. That, in turn, will lead to new insights, from opportunities for trade finance to greater insight into their customers. But it also enables other initiatives, from greater adoption of electronic payments (and therefore greater straight-through processing), to a natural progression to electronic bank account management (eBAM) for all clients.

“E-invoicing is a necessary part of an evolution in client interaction. The business case is slim unless it has been mandated by regulation, as it has in a number of countries such as Brazil,” says Gareth Lodge, Senior Analyst with Celent’s Banking Group and author of the report. “But the value that e-invoicing unlocks will be more than the initial investments. Banks need to work together now, before they find that the ecosystem has evolved without a role for them.”

Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is a wholly-owned operating unit of Marsh & McLennan Companies [NYSE: MMC].

Media Contacts

North America
Michele Pace
Tel: +1 212 345 1366

Europe (London)
Chris Williams
Tel: +44 (0)782 448 3336

Asia (Tokyo)
Yumi Nagaoka
Tel.: +81 3 3500 3023

Table of Contents

Executive Summary


Why E-Invoicing Now?


What Banks Should Revisit E-Invoicing


Banks Need to Take a Broader View


What Is E-Invoicing?



Defining E-Invoicing


Anatomy of an Invoice


Global Status of E-Invoicing









North America



South America



Africa and Middle East


Addressing the Myths



Myth #1: E-Invoicing Will Get You Paid Quicker



Myth #2: Kill the Postman and Collect the Reward



Myth #3: Standards Will Solve Everything


The Way Forward for Banks




Leveraging Celent’s Expertise



Support for Financial Institutions



Support for Vendors


Related Celent Research


Sign in to download reports and access personalized information