E-invoices serve as the documentation of goods supplied by a seller and the outstanding amount that the customer must pay for the goods. The use of e-invoicing improves the traditional invoicing process by boosting accuracy, facilitating quicker payment processing, and lowering expenses.
The GSTN has made it compulsory for certain businesses to generate e-invoices. However, all businesses are still able to create invoices on their ERPs, just like they have in the past. However, they need to modify the process to comply with the standard law.
Businesses have already started to experience the benefits of an e-invoice. For example, e-invoices do not require manual data entry, as a result, there is no data error. Additionally, the software for e-invoice generation can be checked in real-time to eliminate mistakes.
But how has e-invoice improved customer service? What benefits are customers receiving from this modern digital system?
Let us discuss the effects of e-invoice and how they can serve the customers. We will discuss these electronic invoice related topics in this article:
- Customer service benefits
- Enhancing customer experience
- Improving service
- E-invoicing advantages
- Customer service enhancement
- Positive impacts on customer relations
Keep reading to find the answers to all your questions and then decide if e-invoice has benefited the customers.
Customer Service Benefits of E-invoices
The Goods and Services Tax Network (GSTN) introduced the e-invoice system in 2017. An IRN (Invoice Reference Number) and a QR code get produced for each electronic invoice. The goal of implementing e-invoicing is to simplify interoperability by establishing a standard format for all Indian firms, regardless of industry. Since its introduction and implementation, customers generally agree that the e-invoice system has provided certain advantages.
These are the customer service benefits of e-invoices:
- The customers have a better buying experience as e-invoices can be generated online promptly and in real-time.
- Business owners can now expedite the invoice generation process. As a result, the purchase details get finalized quickly, and customers receive their products in a short time-frame.
- Reduced human interaction because of increased automation results in fewer errors in the e-invoice, and that is a factor that customers appreciate.
- The e-invoice is generated online, and customers can track when it is issued and its current status and details.
- Compared to manual invoice records, data saved electronically is safer and cannot be misused easily by an employee. Customers approve of the higher safety that the e-invoice system provides.
- When customers receive an electronic invoice right away after purchase, they usually make the payment online without delay. This method streamlines the payment process.
- Digital document storage also makes document retrieval a simple process. If the customer needs to make changes in the purchase, that can be easily done. This factor is another advantage that customers are happy about.
Enhancing Customer Experience with E-invoicing
All companies want to impress their customers because customer satisfaction directly leads to customer retention. These days, whenever you purchase something online or offline from a big store, you get a computer-generated receipt that is the e-invoice.
However, the small local stores don’t always do that. Have you ever questioned why? The answer is not all companies have to follow the GSTN e-invoicing rules. By law, the e-invoice system must be adopted by companies whose annual revenue in any previous fiscal year from 2017–18 onwards exceeds five crores.
Curiously, this law hasn’t stopped all small companies from generating e-invoice, and that’s because the e-invoice system is hugely popular among customers. Even small businesses have noticed that they can enhance customer experience with e-invoicing.
These are the three benefits of e-invoice that customers genuinely like:
E-invoices are sent directly to the customer’s email address or phone, and the customer information gets saved on the company’s private server. Both processes increase the discretion and security of the customer’s sensitive information. With the right service provider, e-invoices are secured throughout the entire distribution process.
2. Real-time Tracking
E-invoicing makes it possible to track the movement of the goods and the status of the order in real-time. The customer and the seller both benefit from it.
3. E-way bill creation
E-way bills are a necessity for the transportation of goods between states. Generating an e-way bill is simple with an e-invoice because Part A of the e-way bill will automatically fill in the data based on the e-invoice verified through the GST site. Your shipment won’t get delayed because of these technical issues anymore.
Improving Service Through Electronic Invoices
A business can improve its business model and everyday environmental impacts by using e-invoices.
This chart shows how a business can generate e-invoices through an IRP portal:
Let’s see how a company can improve its service efficiency through electronic invoices.
Traditional invoicing is labor-intensive and prone to human error which raises costs and lengthens the processing period. E-invoices use an automated system that gets rid of these issues.
- Automation gives businesses a competitive advantage because ERP systems automatically produce e-invoices, saving time by eliminating manual data entry.
- The likelihood of human-made mistakes gets reduced as a result of this computer-generated process.
2. Instant Invoice Creation
An invoice creation time frame is the time between an invoice being sent and when it is delivered.
- Receiving invoices via electronic means takes less time, and that’s why e-invoices enhance cash flow.
- Offering the buyer early payment incentives leads to a decrease in late fees.
When companies stop producing paper invoices, they start to decrease their carbon footprint. The sustainability factor is a big drive behind customer trust and company branding.
- Reducing carbon emissions and less paper consumption enhances the business’s sustainability goals.
- E-invoices assist businesses in lowering their overall environmental impact, and in the long run, this helps the company build a reputation. Today’s customers prefer to buy from businesses that take their environmental responsibility seriously.
E-invoicing Advantages for Customer Satisfaction
The new, standardized e-invoice formats are widely utilized by companies to boost efficiency and reduce the rate of billing errors. Accurate information, fraud elimination, lower expenses, and increased communication with suppliers all help with customer satisfaction.
- Conventional invoices need to be manually entered into an accounting program; since they are done manually, the results can contain errors.
- The electronic invoice reduces these types of errors and can also be easily integrated with accounting software. Direct input from an e-invoice can prevent manual data input errors and, as a result, enhance overall accuracy.
- The chance of e-invoices sent to the wrong email address is completely nil, and these e-invoices are encrypted too, which means they can only be decoded by an authorized user.
- Unlike sending paper invoices to customers, there is no chance of sending a private invoice to the incorrect recipient.
- Eliminating or drastically reducing the need for human data entry, validation, and invoice registration, electronic invoices can result in significant cost reductions.
- Numerous consumers have seen a decrease in product price since the company is saving money with the use of e-invoices.
- A prompt, error-free payment system helps to improve customer and supplier relationships.
- Any billing-related issues can be resolved immediately and more effectively, and the customers will be happier.
Customer Service Enhancement with E-invoicing
Effective customer service is essential for a company’s success, and with the help of e-invoices, a business can build a partnership with its customers.
- Quick e-invoice creation because of automated procedures leads to fast invoice distribution and processing and improved relationship with the customer.
- The manual processing and mailing delays associated with traditional paper-based invoicing methods can irritate customers, but that problem is eliminated with e-invoices.
- Customers may securely pay bills online with the help of several e-invoicing systems, which come equipped with features like electronic payment choices or online payment portals.
- Payment method convenience gives clients more freedom and increases customer happiness and loyalty.
Positive Impacts of E-invoices on Customer Relations
This chart shows how a company handles the e-invoice creation process and the positive impacts it leaves on the customers.
|50-80% per invoice savings
|Lower product price
|Automated workflows, Reduced errors
|Payment visibility, Faster payment options
|Less errors, Faster dispute resolution
|Improved customer service
|Customer satisfaction, Customer retention
Creating invoices was a laborious and time-consuming process that took hours of effort. In addition, if there were any errors, the invoice needed to be printed again once the issue got fixed. Those are no longer a problem with the advent of e-invoicing, as it takes little time to generate and correct the invoices. Customers always prefer it when they receive the goods quickly, and receive error-free invoices because no one likes to contact the company to complain about billing errors.
- One of the advantages of e-invoicing is time savings because the procedure of creating an e-invoice is entirely digital and takes only a few minutes.
- The supply chain can now work more efficiently since products need not be returned by the customers because of billing errors.
- The data is extracted straight from the electronic invoices, and since the billing systems also keep track of the data, this system guarantees that no mistakes are made while generating an e-invoice.
- Electronic invoices enable more transparency, which is an additional advantage that comes with excellent accuracy.
- The likelihood of business fraud has significantly dropped since e-invoicing was introduced because it is impossible to create and submit a fraudulent invoice. Authenticity and data security of all electronically generated invoices are guaranteed via GSTN authentication.
- Customers benefit from e-invoicing since it greatly simplifies and expedites tracking.
- All the personal data customers submit is instantly accessible, which means if they make an error, they can correct it with great control.
One of the most important actions a business can take to improve customer service is to start using e-invoices. E-invoices are not only more efficient and fast but also offer various other customer-friendly benefits, such as expedited shipping and eliminating errors.
The Indian Government has already enacted laws and put frameworks in place to facilitate e-invoice generation. The customer receives the e-invoice on their email address when the seller has uploaded it to the GST website for authentication.
Small businesses do not fall under government regulations, but they too are adopting e-invoices because of their efficiency. These businesses send the e-invoice directly to the customer’s phone or email address. This process enables the customer to instantly cancel an order if there are any mistakes in the e-invoice.
E-invoices offer sellers many advantages that help with customer service and customer retention. Decreased invoice errors, increased sustainability, payment cycle acceleration, lower costs, modern payment methods, and better communication with consumers are all direct effects of using e-invoices.
Frequently Asked Questions
What exactly is an e-invoice?
E-invoice is a type of software-generated invoice for a sale. An e-invoice gets created in a standard format, and its electronic data may be shared with other people to guarantee data interoperability. Interoperability means that the e-invoices created by one software can be read by other software. The data entry process is not manual for these invoices, and the chances of human mistakes during data entry are non-existent. Since its introduction, the e-invoicing system has benefited customers because of the transparency it provides.
What are the e-invoice laws of GST?
E-invoices are business-to-business (B2B) invoices that are created digitally. These e-invoices adhere to an e-invoicing format verified by the Goods and Services Tax Network (GSTN). The Invoice Registration Portal (IRP) generates a unique Invoice Reference Number (IRN), digital authentication signatures, and a QR code for each invoice after successful authentication.
Can the use of e-invoices eliminate tax evasion?
Since invoices will be created before a transaction is completed, real-time data access will reduce the opportunity for invoice manipulation. It is simpler for tax authorities to detect fictitious input credits since the output tax information and input tax credit are easily accessible.
In the case of a lost e-invoice, can the QR code help generate a new copy?
Under the GST laws, e-invoices are necessary to determine the ITC amount. An assessee can need more copies of the same invoice or misplace one that was previously generated. In situations like this, the QR code will come in handy because the assessee can produce the e-invoice as many times as needed by scanning the QR code supplied with the e-invoice.
What is the difference between an e-invoice and a traditional invoice, and how does it benefit the customer?
An electronic invoice must be uploaded and verified using a distinct invoice reference number (IRN) and a QR code that is digitally signed. The traditional invoice does not include the seller’s QR code or the IRN number.
Is it necessary for all sellers to generate e-invoices?
GST-registered individuals whose total revenue in the fiscal years 2017–18 to 2021-22 exceeds twenty crore rupees, and individuals having a revenue of more than five crore rupees as of August 1, 2023 must use the e-invoicing system.
Can I generate an e-invoice from the GST portal?
No, the ERP software for generating e-invoices is not yet available on the GST website. The e-invoices must follow the standard format, and there are currently no plans for the direct creation of e-invoices on the GST platform.
What are the documents necessary to create an e-invoice?
The supplier’s sale records, credit and debit details, and other documents specified by the GST law must all be recorded to generate an e-invoice. However, there are exempt products that do not require an e-invoice.
What are the advantages of an e-invoice for the customers?
Following the rules to generate an e-invoice may appear difficult, but it has several benefits, especially in terms of customer relations. Data mismatch issues that might arise from manual data entry are less common when using e-invoicing. Since all invoice data is always accessible, e-invoicing also removes the chance of data inconsistencies.
Can I cancel an e-invoice?
Yes, an e-invoice can be canceled, but you cannot cancel just a selected part for cancellation. The entire e-invoice must be canceled, and within 24 hours of the cancellation, the IRN must be notified.