Tuesday, September 06, 2011

Domestic issue - false picture

We often come across statements that e-invoicing is a domestic issue - the cross border part is so small (some 5%) that we do not really need to care. This is a false picture as can be arrived at by just looking at the volumes of cross-border trade.

The reason for this misunderstanding is that enterprises have to establish local subsidiaries and thus - from legal and statistical perspectives do only domestic invoicing. From the operative perspective the picture is often totally different as a single shared service center can handle all invoicing.

For these companies it is very important to move faster to the global ISO20022 standard and harmonize regulations and then not having to support costly country specific practices. Another reason - especially in Europe - is the mandatory migration to SEPA payments. The ISO20022 e-invoice standard is by design fully compatible with downstream SPEA messages such as Credit Transfer as well as ISO20022 account reporting. This is seldom or never the case with local e-invoicing formats.

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