Also keep in mind that every step in the manual billing process is inherently time consuming, even at peak efficiency. With Know Your Invoice, InvoiceMate simplifies banks’ time-consuming due diligence processes. You can independently verify the integrity and authenticity of the invoices provided as collateral.
Not only lenders, but all business partners, including borrowers themselves, business partners, investors and independent auditors, benefit from the benefits of know your invoice.
Verifiability Independent audits are not possible due to the centralized nature of traditional invoice processing software. Operational control over the database prevents independent verification.
All of the above issues lead to the conclusion that traditional invoice processing automation software does not address all invoice processing challenges and creates some new ones. The question that arises is, “What is the solution to all these challenges that arise from traditional invoice processing challenges?”
Blockchain Solves Invoice Automation Challenges
Looking at the issues above, most problems occur for a single reason. It’s centralization. Centralizing databases and software raises many issues related to trust, transparency, and functionality. Therefore, we need a solution to deal with the centralization problem. Blockchain is the answer to the problems caused by centralization.
Interestingly, blockchain not only addresses all invoice processing issues related to centralization, but also other security and efficiency issues discussed above. Let’s see how blockchain addresses these issues. Businesses that involve the sale and/or purchase of goods or services of any type or size. These transactions represent billing. Companies must issue and/or receive invoices.
According to research, invoices are the most commonly used commercial documents. The most used documents also mean the most processed. This means that all businesses process invoices frequently. These invoices can be inbound, outbound, or both. In business, having credit bills is very common.
It’s no exaggeration to say that a significant number of invoices generated are credit invoices. This means that payment will be made at a later date. This period may be shorter or longer depending on the nature and terms of the transaction. The series of processes from procurement to payment within a company is called “invoice processing.”
Traditional financial solutions are centralized in nature. The center in this case is the organization that implements the software. Organizations have full control over the software. All third parties associated with the software can only receive information that the primary organization would like to see. This leads to lack of transparency.
As explained in the previous paragraph, traditional invoice management solutions are managed by major organizations. They have complete control over their data and can manipulate the information to their own interests. This creates trust issues with parties who are not part of the organization.
Scam lack of reliability and transparency, and centralized software control, traditional invoice processing systems are still subject to fraud such as counterfeiting, underbilling and overbilling of invoices. This kind of scam is very difficult to track down as there is no independent monitoring and tracking mechanism.
Traditional invoice processing software is vulnerable to security threats. No extra security layer.
All of these factors have made small business financing more viable than it used to be, but it’s still not up to par. Currently, Pakistan’s invoice financing segment is still largely undeveloped.
Invoice automation solutions outperform manual invoice processing in terms of speed, accuracy, and efficiency. The overall improvement is so significant that automation of invoice processing has become essential in most industries.
This financial inclusion of the larger segment could lead to more sustained economic growth. This is the true spirit behind the United Nations Sustainable Development Goals for the World.