What Is E-Invoicing? A Guide to Digital Invoicing Systems

E-invoicing, or electronic invoicing, is the automated exchange of invoice data in a structured digital format between businesses, customers, or government systems.

As global tax and reporting requirements evolve, more countries, like Belgium, France, Germany, and Poland, are making e-invoicing mandatory to reduce fraud, increase transparency, and streamline financial processes. 

Whether you’re trying to stay compliant or simply want to improve operational efficiency, understanding how e-invoicing works is becoming essential.

In this guide, we’ll cover:

• What e-invoicing is (and how it differs from PDFs)
• How the process works from creation to integration
• Key business benefits, compliance requirements, common challenges and how to solve them
• How to choose the right e-invoicing solution for your business
• Why e-invoicing and EDI often go hand in hand

What Is E-Invoicing and How Does It Work?

What is e-invoicing vs. traditional invoicing?

E-invoicing refers to the creation, exchange, and processing of invoices entirely in a structured digital format, typically XML, UBL, or Peppol, not just as a PDF attachment. 

Unlike traditional invoices, which require manual entry and approval, an e-invoice is designed to be read and processed automatically by software. This structure allows the invoice data to move directly between systems, reducing time, costs, and errors. 

It also enables businesses to meet growing compliance requirements in regions where e-invoicing is now mandatory.

B2B vs. B2G vs. B2C e-invoicing

While the core technology is the same, the use of e-invoicing varies slightly by transaction type:

• B2B (Business-to-Business) e-invoicing focuses on automating invoicing between private sector companies, often as part of a wider EDI or ERP integration.

• B2G (Business-to-Government) e-invoicing is increasingly regulated, with public authorities requiring suppliers to submit invoices via approved digital platforms.

• B2C (Business-to-Consumer) e-invoicing is less common but growing, especially in subscription-based and digital services sectors where automated billing is key.

How does the e-invoicing process work?

The e-invoicing process typically follows a structured and automated flow:

1. Invoice creation: An invoice is generated by your ERP system (or accounting system) using a structured digital format.

2. Transmission: The e-invoice is securely sent to the buyer or relevant government platform via a certified network (e.g., Peppol).

3. Validation: The format and content of the invoice are checked automatically against country-specific or trading partner requirements.

4. Acceptance: Once validated, the invoice is accepted by the recipient or tax authority.

5. Integration: The invoice data is automatically recorded in both parties’ accounting or ERP systems for reconciliation and payment.

To learn more about connecting e-invoicing with your back-end platforms, see our guide to Integrating E-Invoicing with ERP Systems.

The evolution of e-invoicing: from paper to real-time

E-invoicing has evolved through several key stages:

• Paper-based invoicing: Manual generation, printing, mailing, and data entry.

• PDF invoicing: Digitized, but still unstructured and often manually handled.

• Structured electronic formats: Introduction of XML, UBL, and EDI formats enabled machine-readable invoicing and integration with internal systems.

• Networked exchange (4-corner models): Secure data flows between sender, recipient, and service providers through frameworks like Peppol.

• Real-time tax platforms: Increasingly, governments (e.g., France and Poland) require invoice data to be submitted in real time to tax authorities for validation before or during delivery to the buyer.

Why Use E-Invoicing? 4 Benefits for Your Business

E-invoicing isn’t just about going digital, it’s about doing business faster, smarter, and with fewer risks. 

Whether you’re a small business or a multinational enterprise, the advantages of structured digital invoicing are both immediate and long-term.

1. Save time and reduce costs

By replacing manual processes like data entry, printing, and mailing, e-invoicing helps reduce administrative overhead and speeds up every step of the invoicing cycle. 

Your business can:

• Eliminate paper, postage, and scanning costs
• Cut down on invoice processing time
• Free up teams to focus on more strategic tasks

2. Improve accuracy and visibility

Manual invoicing is prone to human error, mistyped figures, lost paperwork, or mismatched POs. E-invoicing reduces these risks by ensuring that data is formatted, validated, and transmitted correctly from the start. 

With automation, you also gain:

• Fewer exceptions and disputes
• Real-time status updates on invoice delivery and acceptance
• Better visibility into outstanding payments and cash flow

3. Strengthen compliance and audit readiness

Government e-invoicing regulations are increasing, particularly in regions like the EU and Latin America. 

E-invoicing helps your business stay ahead of changing mandates by providing:

• Automated compliance with regional formats and rules (e.g. Peppol, XML, UBL)
• Built-in validation steps to avoid rejections
• Secure audit trails for tax reporting and internal controls

4. Enable better cash flow and faster payments

One of the biggest operational benefits of e-invoicing is improved payment performance. By automating invoice delivery and validation, businesses reduce delays and accelerate their cash conversion cycles. 

This leads to:

• Better Days Sales Outstanding (DSO)
• Increased financial predictability
• Fewer late payments and follow-ups

For a deeper look at how these benefits apply to growing businesses, check out our article on the 10 Benefits of E-Invoicing for Small and Medium Businesses.

Compliance and E-Invoicing Regulations

Why compliance is now critical

The move toward mandatory e-invoicing is accelerating worldwide, but not in a one-size-fits-all way. 

While there is a clear global trend to digitize invoicing and combat fraud, each country sets its own technical standards, deadlines, and legal requirements.

E-Invoicing in Europe, UK, and Latin America

In Europe, e-invoicing is becoming central to VAT compliance. Under the EU’s VAT in the Digital Age (ViDA) initiative, many countries are rolling out mandatory e-invoicing frameworks to increase transparency, reduce fraud, and streamline tax reporting.

France

France will require B2B e-invoicing and e-reporting from 2026 using a CTC (Continuous Transaction Controls) model, where invoices must be reported or cleared in real time via government platforms.

Poland

Poland is launching its national KSeF system in 2026, also based on the CTC model, requiring real-time reporting to the tax authority.

Germany and Belgium

Germany and Belgium have opted for a standard e-invoicing approach, mandating structured formats (like XRechnung or Peppol BIS) and the defined exchange channels but without real-time clearance by tax authorities.

The United Kingdom

The UK, meanwhile, is in a review phase following Brexit. While no mandates are currently in place for domestic B2B e-invoicing, HMRC is exploring digital VAT reporting reforms. 

For now, UK businesses should be aware of e-invoicing obligations in other countries where they are tax-registered, as local mandates apply based on tax registration, not cross-border activity.

Latin America (Brazil, Mexico, and Chile)

In Latin America, e-invoicing has been mandatory in countries like Brazil, Mexico, and Chile for years, with strict tax authority involvement and real-time validation systems.

For a detailed breakdown of electronic invoicing regulations by region, including Europe, the UK, and LATAM, read our guide to E-Invoicing Compliance: A Guide to Regional Regulations.

6 Key e-invoicing requirements

Staying compliant with local e-invoicing rules involves more than sending invoices electronically. 

Key requirements often include:

1. Structured formats: E-invoices must use machine-readable formats like XML, UBL, or country-specific standards (e.g. FatturaPA in Italy, Factur-X in France).

2. Authentication: Many regions require digital certificates, secure access, or government-issued credentials.

3. Digital signatures: Used to confirm the integrity and authenticity of the document.

4. Archiving: Businesses must store invoices for a legally defined period – often 6 to 10 years, depending on local tax rules.

5. Data retention and access: Archived invoices must remain accessible and auditable throughout the retention period.

6. Platforms and networks: Some countries mandate invoice exchange via approved channels like Peppol, or through centralised tax authority platforms (e.g. KSeF in Poland, Chorus Pro in France).

With country-by-country variation and evolving deadlines, it’s critical to work with a provider that understands local compliance, and can scale with your international business needs.

How E-Invoicing Integrates with ERP and Accounting Systems

What is ERP-eInvoicing integration?

For e-invoicing to deliver real value, it needs to work in harmony with your existing systems. 

ERP-eInvoicing integration means automatically syncing invoice data with platforms like your ERP, CRM, or accounting software, eliminating the need for manual re-entry and reducing the risk of errors.

A well-integrated solution allows invoices to flow from creation to approval and reconciliation in one seamless process, unlocking benefits like faster validation, better cash flow, and real-time financial visibility.

At TrueCommerce, our e-invoicing solutions integrate with all major platforms, including:

• Microsoft Dynamics 365, including older versions like NAV and AX
• SAP (including SAP S/4HANA)
• Oracle
• NetSuite
• Sage (100, Intacct, X3)
• Other custom or legacy ERP systems

By connecting e-invoicing directly to these systems, businesses gain a more streamlined, compliant, and scalable invoicing process.

Integration methods

There are several technical ways to integrate e-invoicing with your back-end systems. The right approach depends on your infrastructure, IT resources, and business goals.

API integration

This is the most flexible and scalable method. By using electronic invoicing API, your business can achieve real-time, secure data exchange between your invoicing platform and ERP or accounting system. 

This is ideal for businesses seeking fast, automated workflows with dynamic data syncing.

Managed services

Instead of building and maintaining your own integrations, a provider like TrueCommerce handles everything for you. This includes mapping, document translation, partner onboarding, compliance updates, and day-to-day monitoring. 

It’s a hands-off approach that reduces IT strain and accelerates time to value.

Middleware

Middleware acts as a connector or translator between systems, but it often still requires internal IT support. While some legacy setups use middleware, modern businesses are increasingly choosing fully managed services for their flexibility, reduced overhead, and easier maintenance.

With TrueCommerce, our managed services model means we don’t just deliver software – we deliver outcomes. 

You get a cloud-based, compliant, and scalable e-invoicing solution that’s tightly integrated with your ERP system, with expert support every step of the way.

Common E-Invoicing Challenges (And How to Solve Them)

Digital transformation comes with its fair share of hurdles, and e-invoicing is no exception. From technical compatibility issues to user resistance and compliance complexity, businesses can face several obstacles when adopting an e-invoicing solution.

Below, we break down six of the most common challenges, and how TrueCommerce helps you overcome them.

1. Compatibility issues between systems

Many businesses operate with a mix of legacy systems, ERPs, and third-party tools, making integration difficult without the right support.

Our e-invoicing platform is designed to integrate with all leading ERP and accounting systems, including Microsoft Dynamics, SAP, Oracle, NetSuite, and more. 

The cloud-based solution includes flexible API and managed service options that accommodate even the most complex system environments, ensuring smooth data flow across your business.

2. Compliance with regional e-invoicing regulations

E-invoicing rules vary dramatically by country, what works in Germany is not acceptable in France, Poland, or Latin America. 

Keeping up with regional formats, mandates, and timelines can be overwhelming. We continuously monitor evolving local regulations and update our solution accordingly. 

Our managed services model means your e-invoicing processes stay compliant with country-specific standards, such as Peppol, XML/UBL formats, and archiving requirements, without your team having to lift a finger.

3. Staff training and adoption 

New systems can trigger resistance to change, especially when staff are used to manual invoicing or PDF workflows.

We provide a fully managed, user-friendly e-invoicing solution that minimizes disruption. Our onboarding process includes training, documentation, and hands-on support, helping teams adopt the new system with confidence and ease. 

Plus, we automate most steps, reducing the need for staff intervention.

4. Quoting and invoicing challenges

Errors in quoting and invoice generation can lead to disputes, delays, or rejected payments, especially when formats or expectations differ between partners.

Our platform ensures all e-invoices meet the correct format and validation criteria before being sent. Automated checks, pre-configured rules, and document validation tools prevent errors and reduce rejected invoices, streamlining the quote-to-cash cycle.

5. Cost of implementation 

Some businesses worry that adopting an e-invoicing solution will involve costly setup, custom development, or long deployment timelines.

With TrueCommerce, there’s no need for internal developers or custom code. Our cloud-based, fully managed platform reduces upfront investment and delivers a faster time to value. 

For SMEs, we also offer scalable, right-sized solutions designed to fit your budget.

6. Invoice fraud and security concerns

Traditional invoicing methods, especially when handled manually or through unsecure channels, can expose businesses to risks like interception, tampering, or impersonation.

Our e-invoicing platform includes robust security features like end-to-end encryption, digital signatures, and automated validation checks. We also provide real-time document tracking and alerts, so you always know where your invoices are and whether they’ve been accepted.

And if your business still relies on email-based invoicing, we offer secure, backward-compatible options that ensure your data remains protected while supporting your existing workflows.

For more on how to navigate the six challenges above, check out our guide to the 6 Common Challenges of E-Invoicing and learn how to overcome them.

How E-Invoicing Improves Security and Prevents Fraud

Invoicing might seem like a routine process, but in reality, it’s a prime target for fraud. From fake invoices to intercepted payments, traditional methods like email, PDF, and paper leave businesses exposed to significant risk. 

That’s why more companies are moving to e-invoicing, not just for efficiency, but for peace of mind.

Risks of traditional invoicing 

Manual invoicing methods open the door to a wide range of vulnerabilities:

• Invoice fraud: Criminals send fake or manipulated invoices that appear legitimate, leading to unauthorized payments.

• Interception: Paper invoices or email attachments can be intercepted and altered before reaching the intended recipient.

• Lack of validation: Without automation, it’s easier for human error or malicious actors to slip through unchecked.

These risks don’t just lead to financial losses, they also damage supplier relationships and can trigger regulatory or audit issues.

How e-invoicing addresses fraud

E-invoicing significantly strengthens your defences by replacing manual steps with secure, traceable automation:

• Digital signatures authenticate the origin and integrity of every invoice, helping ensure that it hasn’t been tampered with.

• Automated validation checks ensure the invoice meets predefined rules and formats before it’s accepted into your system.

• End-to-end traceability means you can track every invoice from creation to delivery and acceptance, reducing disputes and simplifying audits.

With TrueCommerce, security is built into every step. Our e-invoicing platform uses encrypted connections, role-based access, and real-time alerts to protect your financial data and give you full visibility into document status.

To dive deeper into how e-invoicing strengthens security, read our guide on How E-Invoicing Reduces Fraud and Enhances Security.

E-Invoicing and Supply Chain Efficiency

E-invoicing is not just sending digital invoices, it’s also a key driver of supply chain performance. 

By automating core financial workflows and improving communication between partners, e-invoicing helps your business move faster, reduce errors, and make smarter decisions across the entire supply chain.

Role in automating AP and AR

Accounts Payable (AP) and Accounts Receivable (AR) are often slowed down by manual processing, mismatched data, and approval delays.

 E-invoicing software streamlines these processes by:

• Automating invoice matching with purchase orders and goods receipts to enable faster approvals.

• Triggering payments automatically once validation rules are met, reducing bottlenecks and late fees.

• Minimizing manual intervention, allowing finance teams to focus on exceptions rather than data entry.

By integrating e-invoicing with your ERP or accounting system, you ensure a seamless flow of financial data, from order to payment.

Improved supplier/customer communication

A well-functioning supply chain relies on clear, timely communication. E-invoicing supports this through:

• Automatic validation and rejection notifications, helping suppliers fix errors before they become delays.

• Standardized formats, ensuring consistency and reducing the risk of misinterpretation across systems.

• Real-time data movement, enabling faster updates to downstream systems like inventory, logistics, or analytics platforms.

• Fewer human errors, which translates into fewer disputes and smoother business relationships.

TrueCommerce’s fully managed e-invoicing solutions integrate across your supply chain ecosystem, giving you the visibility, speed, and accuracy needed to stay competitive.

For a closer look at how e-invoicing drives performance from procurement to payment, explore our guide on The Role of E-Invoicing in Supply Chain Efficiency.

E-Invoicing and Sustainability

As organisations increase their focus on sustainability and ESG (Environmental, Social, and Governance) targets, e-invoicing offers a practical, high-impact way to support greener operations, without compromising efficiency.

How digital invoicing supports ESG goals

Replacing paper-based invoicing with fully digital workflows directly reduces your environmental footprint:

• Paper reduction: By eliminating the need for printed invoices, envelopes, and postal delivery, e-invoicing significantly cuts paper use across finance operations.

• Energy savings: Automating invoicing means fewer printers, scanners, and delivery trucks in use, reducing energy consumption and CO2 emissions.

• Carbon reporting and tracking: Digital processes generate clean, structured data that makes it easier to track and report on carbon reductions and ESG performance.

With TrueCommerce, our electronic invoicing solutions help you not only streamline operations but also align with broader CSR and sustainability objectives. 

Whether you’re targeting net-zero goals or aiming for ESG certification, digital invoicing is a simple, measurable step in the right direction. Learn more in our guide on how invoicing software supports business sustainability and environmental management.

Choosing the Right E-Invoicing Solution

Finding the right e-invoicing solution depends on your business size, systems, compliance needs, and growth plans. 

Whether you’re just starting to digitise or scaling internationally, the right platform should offer both immediate benefits and long-term flexibility. 

4 Key features to look for

As you evaluate providers, prioritize platforms that offer:

1. Compliance support: Stay aligned with national and regional mandates like the EU VAT Directive or Peppol standards.

2. ERP integration: Ensure seamless data exchange with systems like Microsoft Dynamics, SAP, Oracle, and NetSuite.

3. Automation: Reduce manual input with built-in workflows for invoice validation, submission, and response tracking.

4. Analytics and visibility: Access dashboards and reporting tools to monitor cash flow, invoice status, and compliance metrics in real-time.

The right feature set can reduce admin burden while ensuring you remain audit-ready and responsive to regulatory changes.

The right feature set can reduce admin burden while ensuring you remain audit-ready and responsive to regulatory changes.

Cloud-based vs. on-premise e-invoicing software

Cloud-based e-invoicing platforms	On-premise e-invoicing solutions
Easier to implement, scale quickly, and come with automatic updates and security patches.  Ideal for companies with limited in-house IT resources or those managing multiple regions with different compliance needs.	Give you more control but require internal infrastructure, regular maintenance, and higher upfront costs.

TrueCommerce is one of the leading e-invoicing solution providers, offering end-to-end support and secure, cloud-based, fully managed electronic invoicing software for businesses.

This gives you peace of mind with enterprise-grade reliability and automatic compliance updates.

Best options for SMEs vs. large enterprises

SMEs	Large enterprises
SMEs benefit from flexible, user-friendly platforms that minimise setup complexity while delivering essential compliance and automation features.  Cost-effective onboarding and support are key.	Large enterprises require robust scalability, multi-country compliance support, and integration with multiple ERPs or trading platforms.  A provider with global infrastructure and deep technical expertise becomes critical.

TrueCommerce supports both ends of the spectrum, offering tailored solutions that scale with your needs, whether you’re handling dozens or thousands of invoices per month.

Is E-Invoicing Right for You?

E-invoicing is more than just a regulatory requirement, it’s a smarter way to do business. Whether you’re a growing SME or a multinational enterprise, the benefits are clear:

• Lower costs and faster turnaround times
• Greater accuracy and real-time visibility
• Simpler compliance with national mandates
• Improved cash flow through quicker payments
• Better operational efficiency with reduced manual tasks

Who benefits most?

E-invoicing delivers measurable ROI for businesses of all sizes, but it’s particularly valuable for:

• Fast-growing SMEs looking to streamline admin and improve scalability
• Companies operating in regulated markets, where e-invoicing is mandatory or soon will be
• Any business managing high invoice volumes, multiple trading partners, or multi-country compliance

If you’re currently using manual or PDF-based invoicing, now is the time to assess your process. Even if you already have EDI systems in place, adding e-invoicing doesn’t need to be complex, and can actually enhance your broader integration strategy.

How E-Invoicing and EDI Work Together

Despite the differences in format and use case, EDI and e-invoicing are fundamentally similar technologies, they both enable structured, automated data exchange between business systems.

Rather than treat them as separate systems, you can integrate both into a single ERP-connected platform to manage everything from order-to-cash to procure-to-pay workflows. 

For example:

• A purchase order might be exchanged via EDI (e.g., EDI 850 or EDIFACT ORDERS)
• The invoice for that order might be sent as an e-invoice, structured in XML or Peppol BIS format
• Both documents flow through the same ERP, with real-time visibility and tracking across the lifecycle

With TrueCommerce, you don’t need to manage separate tools or integrations. 

Our platform connects EDI and e-invoicing into one unified solution, syncing effortlessly with leading ERP systems like Microsoft Dynamics, SAP, Oracle, and NetSuite.

This approach means:

• Less complexity for IT teams and finance departments
• Easier compliance across all document types and regions
• Stronger supply chain visibility, from purchase to payment

What’s more, if you’re investing in e-invoicing to meet government requirements, you can use that momentum to improve other critical processes, like EDI, order processing, or inventory updates.

If you’re curious about EDI solutions, you can learn everything you need to know in our guide to Electronic Data Interchange. 

Next steps: book a free consultation with our experts

E-invoicing is a requirement for many, but for forward-thinking businesses, it’s also an opportunity to modernise, integrate, and scale.

Are you wondering if e-invoicing is a fit for your business? Here’s where to begin:

• Audit your current invoicing and EDI setup: Where are the delays, errors, or manual steps?

• Talk to our experts: We can help you identify opportunities to unify and streamline your invoice and document exchange strategy.

• Book a free demo or consultation: See how TrueCommerce simplifies e-invoicing, EDI, and ERP integration in one place.

FAQs about E-Invoicing (Electronic Invoicing)

Whether you’re just starting with e-invoicing or looking to understand how it fits into your systems, here are answers to some of the most common questions businesses ask.

What’s the difference between e-invoicing and PDF invoices?

A PDF invoice may be sent digitally, but it still requires manual handling. True e-invoicing means the invoice is created, transmitted, received, and processed automatically in a structured format that can be read by software, without human input.

Is e-invoicing mandatory in the UK?

As of now, e-invoicing is not mandatory in the UK for B2B transactions, but public sector entities are encouraged to adopt it. The UK government is currently reviewing its approach, and mandates may follow as part of broader digital transformation initiatives.

What systems does e-invoicing integrate with?      

E-invoicing can be integrated with most ERP, CRM, and accounting platforms, including Microsoft Dynamics, SAP, Oracle, Sage, and NetSuite. Integration ensures invoice data flows directly into your systems for automated processing and reporting.

How does electronic invoicing work?

E-invoicing works by generating a structured electronic invoice (e.g., XML or UBL), transmitting it securely via a network or portal, validating it against local standards, and automatically importing it into the recipient’s finance system. This removes the need for manual entry or PDF attachments.

What is the difference between e-invoicing and e-billing?

E-invoicing typically refers to B2B or B2G invoice exchange using structured data formats and integrations with financial systems. E-billing is a broader term that may include consumer-facing digital bills or emailed PDFs and doesn’t always involve automation or compliance features.

When is e-invoicing mandatory?

E-invoicing mandates vary by country and sector. In the EU, several countries (including France, Germany, Poland, and Belgium) are introducing phased mandates starting in 2024-2026. Many Latin American countries already require e-invoicing for most businesses. B2G e-invoicing is already mandatory in many EU countries.

E-invoicing is mandatory in which countries?

Mandatory e-invoicing is already in place in countries like Italy, Mexico, Brazil, Chile, and India. EU countries including France, Poland, and Germany have upcoming mandates, while others (e.g., Belgium, Spain) are in transition. E-invoicing requirements vary by country, industry, and business size.