The Downsides of Paper-Based Invoicing: 4 Top Reasons to Go Digital

Invoices are a significant part of the business. It would help if you generated invoices regardless of the company you own. It is, however, a big task to process invoices, especially when you do it manually. The surprising fact is that most businesses still use the manual method. You will find many companies using PDF formats to send and receive invoices. Scanning and capturing physical invoices requires a vast amount of time and resources. This eventually delays the process. As a business owner, you must understand that using the traditional method is time-consuming and error-prone. 

What is paper invoicing?

It is a traditional method of generating and distributing printed physical invoices. It consists of manual processes and physical documentation. The hard copy invoices also need physical delivery via courier or mail. This process is almost entirely manual, which makes it prone to error and face many challenges. 

Significant Challenges in the Manual Invoicing Process:

Imagine you are creating invoices and paystubs for thousands of employees, and all paper records get missing. It’s pretty frustrating, so automated tools are paramount. Now, let us see the significant challenges of manual invoicing.

Labor intensive:

You not only spend a huge amount of time on paper handling and data entry but also need to cross-reference manually for validity. It takes a lot of time because the staff must compare the invoice with a PO or contract. A company might use thousands or even millions of such invoices daily. It wastes a lot of time for the staff members involved.

High Risk of Errors:

You can receive invoices through various means such as mail, courier, fax, email, and other formats. These multiple sources can confuse the staff, so you must enter them into a single system. If you do it manually, it will lead to a good use of time and possible errors. Some errors include paying invoices without delivery of goods or paying the same invoice twice. You may even pay incorrect amounts or enter the wrong PO number.

Monitoring difficulty:

If you use a paper invoice, you risk losing them quickly. You need to store them in the right place to prevent them from getting lost and mixing up with other papers. It is a challenging task to monitor every invoice. Staff usually spend too much time handling queries from suppliers about their payment status. Hence, it wastes time and resources. 

It is time to rethink if your company still uses a traditional invoicing method. You can ease this process by modernizing and embracing electronic invoicing. This article will highlight four significant benefits of using electronic invoicing. However, let us first understand what electronic invoicing is.

What is electronic invoicing? Advantages of going digital: 

It is the process of sending invoices in a digital format. Electronic invoices, or e-invoices, streamline the invoicing process. They reduce costs and enhance staff efficiency.


An E-Invoice saves you a lot of money compared to paper invoices. You will no longer need to pay for the paper you use to print them or the postage required to send out invoices to your customers. In regards to a paper invoice, an electronic invoice saves you money in many ways. It will take less time to enter data into accounting books. A traditional invoice requires data entry from a staff member. It is a time-consuming process for which you must pay your employee. 


Electronic invoices are more accurate than paper invoices. They need fewer processing steps and less risk of error in the invoice process. In a paper invoice method, the staff is responsible for data entry and transmission, and there are many steps in which errors can take place. It can occur during invoice creation, customer payment, and data entry. However, when you use an electronic invoice, there is only one point at which an error can occur: creating the invoice. An e-invoice reduces the risk of error in your invoicing process and accounting books.


Finance staff often enter data manually from paper invoices into accounting systems. This slows down the bookkeeping process. However, when it comes to electronic invoices, you can send, receive, pay, and settle several times faster than paper invoice methods. This can greatly reduce the time spent entering your invoice information into your accounting system. The data from the electronic invoice format can automatically get synced into your accounting systems. Moreover, this reduces the time and price it takes for an employee/company to do the data entry manually. 

Environmentally friendly:

The paper-based invoicing has severe environmental impacts. Consider big companies that send hundreds of thousands of monthly invoices and the paper they use. For example, if you take a company that sends out 330,000 invoices a month, they use almost 38,500 gallons of oil, 1.5 million gallons of water, and 5.6 tons of paper. This shows that electronic invoices are better for the environment than paper invoices. 

The solution to traditional invoicing problems? Transforming to digital:

As you saw, there are so many things that could be improved with paper-based invoicing processes. Hence, all businesses should start using electronic invoicing (e-invoicing). Many customers prefer to receive invoices through different channels. It can be through email, collaborative portals, or electronic data interchange (EDI). Electronic invoicing allows easy customization, fast error correction, and efficient dispute prevention. This leads to faster payments, more effective cash flow, and less staff time and energy spent on difficult invoicing. Your customers are also satisfied eventually.

Jasper is a professional business and startup blogger that writes for a variety of leading sites. He loves content partnerships with advertisement agencies.