Invoice payments to a supplier can be delayed for two main reasons. The first has to do with the business making the payment. It might be short of cash, struggling with a lockdown or unable for any number of other reasons to settle an invoice quickly.
The second is about process – the time it takes the customer to complete its accounting steps and get an invoice into its next scheduled payment run.
E-invoicing can’t do much about the first reason, but it has a powerful effect on the second. E-invoicing delivers invoice data straight into a business’ approval process for prompt approval and then into the accounting system ready for payment. All the overhead of scanning invoices or keying in data, making corrections and chasing emails or paper for approval is reduced or removed altogether, cutting the invoice payment cycle from weeks to days. That’s one of the reasons that New Zealand Government agencies have undertaken to pay invoices received as an e-invoice within 10 days, a big improvement from the 30-90 day payment cycle that most government suppliers expect.
Interested in faster payments and how we can help your business move to e-invoicing?