e-invoicing mandate a big win for business
Small and medium businesses will benefit from faster payments and savings when sending and receiving invoices with the NSW Government, with e-invoicing to be made mandatory for all government agencies from 1 January 2022.
The mandate will apply to the delivery of goods and services up to the value of $1 million.
Minister for Digital and Minister for Customer Service Victor Dominello said the mandate will help reduce payment times, paperwork and manual errors, and save buyers and suppliers a significant amount of money.
“This is great news for SMEs who are the backbone of the economy. There is an estimated shared saving of around $20 each time e-invoicing replaces a paper invoice and around $17 each time it replaces a pdf invoice,” Mr Dominello said.
“Based on the 4.2 million invoices across NSW Government in 2019, a shared saving between the suppliers and NSW Government is estimated to be $71 million.
“This means the Government can spend more time helping customers and businesses can focus on their operations.”
Funding was allocated through the Digital Restart Fund to set up an e-invoicing service.
The NSW Government is leading efforts to see e-invoicing adopted across Australia.
Research indicates that e-invoicing rates in Australia range from 15 per cent for small businesses to 23 per cent for large businesses, compared with 28 per cent across Europe and 40 per cent in Denmark and Finland.
Minister for Finance and Small Business Damien Tudehope said this would improve the way SMEs interact with the Government.
“This mandate will enhance the Government’s existing Faster Payment Terms Policy, by ensuring that the accounts payable teams in Government agencies receive invoices within minutes, enabling payment to eligible small businesses within 5 business days,” Mr Tudehope said.
“One of the biggest issues for small businesses across NSW is cashflow and we want to take steps to ensure that properly rendered invoices reach and are actioned by the right teams as quickly as possible.”
Suppliers will have the option to use e-invoicing or continue to invoice Government agencies through existing means.