Power of PAYBOX®
Why OMB's E-Invoicing Mandate Is a Positive Move for Federal Government Agencies
The federal government announced that it will move to adopt e-invoicing solutions, mandated by the Office of Management and Budget (OMB). Out of the nearly 19 million invoices the federal government receives annually, just over 7.5 million (about 40 percent) are electronically processed.
In recent years, more companies have shifted toward the use of electronic invoicing and automated AR processes. Per the OMB mandate, government agencies are obligated to use a shared e-invoicing service provider. However, the federal government isn’t alone in transitioning to e-invoicing. In recent years, many private sector organizations have said goodbye to paper-based, manual invoicing and AR processes.
E-invoicing delivers a host of benefits that agencies and companies can’t get with outdated paper invoicing solutions. Benefits include:
- Cost-Effectiveness – Paper invoices can cost organizations as much as $13 per invoice. E-invoicing relies entirely on electronic presentment and collections, reducing invoice costs to around $1 each. In addition, electronic platforms reduce the need for AR department personnel to create, distribute and process invoices, which enables agencies to reassign staff to tasks that need immediate attention.
- Improved Cash Flow – One of the biggest obstacles agencies run into with paper invoices is slow processing. Between printing, mailing and payment times, departments can wait weeks before invoices are settled. Not only does an electronic system speed up invoice presentment, but it enables agencies to receive payments faster. The result? A reduction in Days Sales Outstanding (DSO) cycle time and increased cash flow.
- Increased Security – Paper invoices aren’t secure, and stand a high likelihood of being viewed by an unauthorized third-party. But automated invoices are typically hosted on a secure, encrypted platform that protects sensitive and company information. The advanced security protocols mitigate the chances of information being lost or stolen. Additionally, an automated solution can protect agencies from payment fraud.
Solutions like PAYBOX® CORE from Direct Insite simplify e-invoicing adoption for government agencies. A full-featured, cloud-hosted financial automation platform, PAYBOX® CORE combines electronic invoice processing, presentment and collections to streamline AR department processes and accelerate cash flow.