Beginner's Guide to Electronic Invoicing

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Electronic invoices are the exchange of invoice documents between supplier and buyer in an integrated electronic format

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Beginner's Guide to Electronic Invoicing
Beginner's Guide to Electronic Invoicing
Today's companies are increasingly looking for ways to digitize their invoicing systems. When e-billing systems are properly set up, they can help companies reduce costs and make better use of data. What are e-billing and what is important for companies, especially beginners? Read on to find out the answer, where we prepared you a comprehensive guide to electronic invoicing.

What is electronic invoice?

Electronic invoice is an invoice document exchanged between the buyer and the seller in a mutually conceptual format, which controls the electronic invoicing process, so that companies can manage electronic invoicing using consistent processes across most accounts.
Some electronic invoicing standards depend on the rules used by suppliers in good faith, which customers generally expect, there are also billing standards to be used to meet requirements set by governments, and generally, electronic invoicing needs to clearly show the supplier's address and contact information, also the invoices need to show a clear due date, delivery date and issuance date.

What are the benefits of electronic billing?

Electronic invoicing systems have tremendous advantages over paper invoices, including:

1. Reduced costs

Electronic invoices reduce the cost of invoices by avoiding the need to manually print documents and place them in envelopes. For suppliers, electronic invoices help reduce costs by eliminating mail processing costs associated with a transaction. In addition, when bills can be easily accessed through electronic systems, employees can immediately access them from anywhere in the world.

2. Easy to track invoices

When using electronic invoicing software, you will be able to know when the invoice was sent, displayed and paid, and depending on the service provider, you can also know when the invoice was displayed by the customer.

3. Automation

The use of automation can help companies make their cost structures more efficient while improving how invoices are processed, as automated tools can identify transactions for inconsistencies or potential fraud, and in other cases, invoices can be paid immediately through a fully automated process.

4. Simple Archiving

When using the electronic invoicing system, there is no need to print, store and retrieve documents. Instead, the electronic invoicing system gives you the ability to store all your documents digitally in a way that allows immediate recovery at no cost. Therefore, using the electronic invoicing system helps save money while making your business more effective at processing invoices.

5. Organization

Through electronic invoicing, unnecessary steps such as manual entry, accuracy verification, and swap software are eliminated. For this to be possible, the invoice must be in a format that the buyer's system can process, and here come electronic invoice files as structured data.

6. Higher degree of control

If you use electronic billing software, everything will be saved on one platform accessible from anywhere and on any device, and you can also get an overview of your bills through automated reports and analysis.

Electronic invoice types

Electronic invoices can be classified according to their commercial use, here are some of the most common types:

Sales Bill

This is the most common type of electronic invoice, as the company creates a sales invoice for payment request when it sells goods or services to a customer, standard information on the invoice includes suppliers' and customers' names, contact information, invoice number, goods or service provided, amount due, payment deadline and accepted payment methods.

Preliminary invoice

This type of electronic invoice, used by sellers to provide an estimate before issuing any goods or services, uses the estimated cost, description of work and any other information the customer may need to decide whether to proceed and place an order.

Overvalued invoice

This type of electronic invoice is sent to the customer who has not paid a sales invoice by the due date, may include the late fees specified in the sales contract, which must be sent to the customer as soon as possible after the due date, and include all the details in the original sales invoice.

Credit Bill

The company sends a credit note, also known as a credit bill, when you need to offer a discount or refund, a credit bill may be issued in case the product is damaged during shipment or to correct a previous invoice error.

Discount Note

This document is also called the debit bill, and indicates that the company needs to increase the amount owed by the customer, The debit invoice also refers to a range of related business operations carried out by creditor and debtor account staff Sometimes in a central common service centre, these operations involve checking and sending customers' invoices invoices received from the company's suppliers and reconciled them, and monthly rebates applied to vendors' invoices.

Mixed invoice

This type of electronic invoice combines credit and debit fees into a single invoice, and the net amount reflects what the customer owes.

Commercial invoice

This is a special type of electronic invoice required for certain international transactions, used to obtain customs clearance and calculate any tariffs and customs duties, and depending on the country concerned, commercial electronic invoices may include the customs classification of goods, as well as quantity, weight or size, description and price.

Schedule invoice

Companies that provide invoices for their services on an hourly or daily basis usually send schedule invoices, the schedule invoice includes the number of hours worked and the hourly rate collected, professionals who use schedule invoices include lawyers, consultants and psychologists.

Provisional invoice

Large projects are often completed in phases, with partial payments made upon arrival of landmarks, milestones and payments are agreed upon before the start of the project, here temporary electronic invoices help small companies manage their cash flows in large projects.

Final invoice

The final electronic invoices are sent upon completion of a major project and show the amount due after deducting any temporary payments from the total cost of the project.

Recurring invoice

Companies that provide continuous or recurring services often use electronic invoices, which are issued monthly or at other regular intervals, and examples of companies that issue recurring electronic invoices include companies that provide cloud-based software, streaming services or gym membership.


Companies of various sizes are avoiding the process of preparing boring paper invoices from printing to mail, just as, while the company can focus on its core business again and does not need to spend resources on complex support processes such as accounting, Through electronic invoices, the recipient is in turn exempted from handling the received invoice invoice data can be automatically transferred to the ERP/accounting system.

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