What is the Future of E-Invoicing? Where is it Heading?

March 2019 — Insights from an Industry Expert on the Future of E-Invoicing in the USA

By Dooap Inc.

We had an opportunity to catch up with Todd Albers, Senior Payments Consultant, The Federal Reserve Bank of Minneapolis, to discuss e-invoicing trends and insights. The Federal Reserve Bank has been instrumental in facilitating industry dialog to adopt e-invoice standards as well as supporting e-invoicing services to the federal government through the Department of Treasury.

Here are some highlights from our discussion:

Dooap: What is the status of e-invoicing at the federal level?

Todd: The federal government has been implementing AP automation and e-invoicing solutions for a number of years. Automating invoice receipt and capture is an important goal for the federal government to reduce processing costs, late payment penalties and costly errors. E-Invoicing also helps these departments better comply with the Prompt Payment Act, which is designed to ensure that the government pays its suppliers on time.

Currently, this is being support by three federal Shared Service Providers – one for the Department of Veteran Affairs, another for the Department of Defense, and the third through the Department of Treasury Bureau of Fiscal Services. We provide support for the Invoice Processing Platform or IPP offered to federal agencies through the Bureau of Fiscal Services.

While the transition to e-invoicing is underway, it is a process. The government receives well over 21 million invoices annually and an estimated 40 to 45 percent of them are electronic. Its goal is to steadily increase that percentage.

Dooap: Describe the Federal Reserve Bank’s role in working with the U.S. Treasury on this initiative?

Todd: The Federal Reserve Bank, is a technology service provider to the U.S. Treasury Bureau of Fiscal Services. We are tasked with helping Treasury Fiscal Services to implement its invoice processing platform in order for Federal agencies and departments to streamline processes and help its suppliers transition to e-invoicing. More than 100 different federal government entities use IPP for their invoice processing today.

Dooap: What work is the Federal Reserve doing to promote B2B e-invoicing and what progress has been made?

Todd: The Federal Reserve recognizes the importance of spurring e-invoicing adoption among B2B companies, and in 2015 published the Strategies for Improving the US Payment System paper. The Federal Reserve Bank established The Business Payments Coalition, a working committee of key industry players – including Dooap – to promote e-invoicing, along with electronic B2B payments and remittance data.

The e-Invoice Work Group, which is a subgroup of this coalition, provides guidance and education to facilitate e-invoicing adoption in the market. We found that promoting e-invoicing not only improves the invoicing process, but it is also integral to reducing manual operations throughout purchase-to-pay. Decreasing paper invoices, for example, helps to reduce check payments, which are costly, outdated and more vulnerable to fraud than electronic payments.

One of our first orders of business in the Work Group was to define what a true e-invoice is. While some people may think sending a PDF document via email is an e-invoice, a true e-invoice is one that can be automatically received, coded and matched. The e-Invoice Work Group defines it as “An invoice that has been issued by the seller, transmitted and received by the buyer in a structured digital format which allows for automated processing.”

Next, we are working on developing e-invoicing industry standards to enable a standardized exchange of information between different invoicing processing systems. This is instrumental in removing obstacles to e-commerce.

Dooap: What are the barriers to e-invoicing adoption in the U.S.?

Todd: We have too many different invoicing formats and no one standard. With more than 800 accounting technology services providers in the U.S., there are numerous e-invoicing formats in the market, creating interoperability issues and roadblocks. Also, given the tendency for people and organizations to resist change, there’s inertia that has to be overcome. Implementing e-invoicing involves an initial investment of time, commitment and money, which while it will pay dividends in the future, might also be a barrier for some organizations. Our work group is focused on helping organizations overcome all of these barriers.

Dooap: How are US initiatives different from the EU?

Todd: While the EU efforts are focused on the public sector, and took a top-down approach with their directives, the U.S. is primarily focused on a bottom-up approach by engaging private industry with its e-invoicing initiatives. This fits in with our free market principles, and recognizes how business moves markets and introduces innovation.

Dooap: What will spur wider e-invoicing adoption?

Todd: We’re still at the beginning stages of developing the necessary standards to transition to broader e-invoicing in this country. Of the estimated 25 billion invoices sent each year, 18 billion of those are still paper-based. As businesses begin adopting e-invoicing and require that their suppliers send invoices electronically, it will create a network effect, encouraging the suppliers’ buyers to participate, and so on.

Adoption also will increase as both buyers and suppliers realize the benefits that e-invoicing delivers, including reduced costs and errors, faster payments and streamlined processes. On a larger scale, it facilitates B2B efficiency and improvement, paves the way for cross-border payments and enables greater market competitiveness. Those are great business incentives.


We’ll continue to keep you posted on the latest developments from the e-Invoicing Work Group and ways you can implement e-invoicing in your organization to gain competitive advantage.


When it comes to invoices, it’s all about the data.

When it comes to invoices, it’s all about the data. The type of data, the format and the way that the data is captured are all things to consider as you transform your invoices from paper to digital and prepare for automation.

The Road to AP Automation No. 2 – The Invoice explains how you can digitize and improve the quality of your invoices as you get ready to automate.

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