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Peppol eInvoicing: An Introduction to New Opportunities for Australian Businesses

February 21, 2022

Peppol eInvoicing: An Introduction to New Opportunities for Australian Businesses

Peppol eInvoicing is transforming the invoicing experience for businesses of all sizes and in different industries, including construction, manufacturing and services across Australia. From a business’s perspective, Peppol eInvoicing can reduce the time spent on administrative tasks and also allows businesses to quickly, accurately and securely send invoices to their customers and receive invoice data from their suppliers.  General awareness across Australia for Peppol eInvoicing is growing but there is still some confusion, myths and misinformation out in the market,  in this context we are going to provide an introduction to the opportunities that Peppol eInvoicing provides for businesses across Australia.

what is Peppol eInvoicing?

Electronic invoicing (or eInvoicing) is the digital and automated process of sending and receiving invoice data between two companies.  Data is shared directly between the buyers and suppliers system – removing the need for any manual data entry or validation of the invoice. This process often includes validation of invoice information, acknowledgement of receipts and some specific business rules.  Historically, sending PDF invoices via email was often wrongly referred to as eInvoicing due to the fact that manual data manipulation or validation was required enter the invoice data – even where OCR data capture solutions are in place.

The game-changing piece has been the adoption of the Peppol framework for eInvoicing, which provides a secure, effective way to send and receive Peppol eInvoices via a commonly adopted framework. The Australian, New Zealand and Singaporean governments have all agreed on adopting the Peppol framework for eInvoicing with over 11,000 businesses already using the Peppol network (up from approximately 200 12 months ago). The ATO estimates that businesses shifting to eInvoicing can reduce the cost of processing an invoice down to $9.18 (down from $27.67 which is the average cost to process a PDF invoice). The NSW Government estimated a shared saving between suppliers and the NSW government of $71m based on the 4.2 million invoices across NSW Government in 2019. So the business benefits are pretty hefty when e-invoicing is adopted between buyers and sellers.

Is peppol eInvoicing right for you?

With so much different information in the market around Peppol eInvoicing its important to consider where you are coming from when deciding whether Peppol eInvoicing is right for you, our team of procure to pay automation experts pulled together the table below to help you identify the differences between each method of invoicing and the pros and cons of each.

Depending on which invoicing method you are currently using, the benefits of Peppol eInvoicing can be game-changing. Typically, we find that Peppol eInvoicing can help support businesses with a range of challenges they face today:

Problem: Large supplier base making invoice automation impossible and too expensive

Once you are connected to the Peppol network you can automatically engage with any other organisation in the network – greatly enhancing your ability to automate invoice processing with all your suppliers. If your trading partner is not on the Peppol network yet, there are straight forward ways for businesses to get connected.

Problem: High Risk of Invoice Fraud

PDF invoices can easily be intercepted and manipulated before being received, email compromise scams like this are on the rise. With Peppol eInvoicing, the sender is validated to ensure they are who they say they are and that bank account details match your records before transmitting the data through the Peppol network. The network itself is highly secure as only accredited Peppol Access Points providers can exchange the documents over the Peppol network. Access providers like us are required to meet strict security protocols equivalent to ISO27001 covering intrusion prevention, multi-factor authentication for privileged user access and data encryption to ensure the security of the network. This creates an affordable, reliable and scalable way to combat invoice fraud.

Problem: Cash Flow Management

Businesses can be crippled when buyers pay them late, invoices can get missed when it’s reliant on human intervention. Equally, buyers can miss out on early payment discounts if the invoice is lost or not processed quickly. eInvoicing speeds the whole invoice processing piece up for both sides, removing the worry of whether an invoice has been received and processed or not. In Australia, Commonwealth and NSW government agencies also guarantee 5-day payment terms for Peppol eInvoices which makes eInvoicing even more attractive.

what do i need to get started with peppol einvoicing?

To be able to send and receive Peppol eInvoices you need 3 things:

1. An integration between your finance systems and the access point

You need to be able send data into the Peppol network, this is most commonly enabled through an automated integration from your accounts payable (to receive invoices) and accounts receivable (to send invoices) into a Peppol Access Point.

You can choose to use a different Access Point to send invoices and a different Access Point to receive them but be mindful that this may create an administrative and overhead management that comes with two providers.

2. Provide additional information to be able to send a Peppol eInvoice

The Peppol framework has mandatory data requirements to ensure that the security, compliance and robustness of the network is maintained.

For Australia and New Zealand, the information that is required is pretty standard to what organisations are already producing to create an invoice at the moment but there may be new fields that you need to create in order to meet the format.

Some providers, like us, can augment some data that is required based off information that is already provided for the invoice – make sure you discuss this with prospective solution providers.

3. Your invoice data export to be converted to a Peppol (BIS 3.0) format

Some finance systems are able to export your invoice data into the format that Peppol requires – Business Interoperability Specifications (BIS). For those that can’t, access point providers like us are able to translate the invoice date you can export into a BIS format as part of the integration. In the simplest of circumstances you can be up and running with Peppol in less than two weeks, with more complex systems and processes this may take a few weeks.

where are we now with peppol einvoicing in australia?

Interest in Peppol in Australia is definitely on the rise and the term is becoming more well known and more well used in the market. We are certainly seeing this in our own data, with monthly website visits to our Peppol related pages up over 880% compared to March 2021. As mentioned earlier there are well over 11,000 organisations registered in the Peppol network in Australia alone – an increase of over 3,500%.  There are already a number of Peppol eInvoicing mandates across State and Federal Governments and a consultation paper out for what a business mandate may look like in the future, so the wind is certainly behind the sails of Peppol in the region.

where can i find more information about peppol einvoicing in australia?

There is wealth of information on the ATO’s website – Additionally we have created a series of articles to help businesses understand more about Peppol eInvoicing:

takeaway: e-invoicing is a new opportunity for businesses across australia.

The ability to send invoices electronically enables Australian businesses to connect with their customers and suppliers in a new way, saving time and improving accuracy. You might also be able to be paid faster. Peppol eInvoicing is an innovative technology that is putting power back in the hands of the businesses of all sizes, creating opportunities for them to reduces errors, save time, improve cash flow and ultimately deliver peace of mind that your documents have been send and received safely and securely.

If you need some help deciding whether Peppol is right for you, feel free to contact us today!

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