3 Smart Invoicing and AP Automation Trends to Watch in 2023
Originally Publish March 29, 2023 – Updated May 4, 2023.
In 2022 alone, the global digital or e-Invoicing market hit $11.2 billion, and experts predict a compound annual growth rate of more than 20% over the next five years. With such large growth on the horizon, 2023 promises to be a year of great innovation in e-invoicing. But there are three trends you should pay extra attention to this year which include:
- Expansion of AI
- Adoption of government-mandated clearance models
- Accounts Payable (AP) as a strategic stakeholder
Here's what you need to know about these trends and how Coupa Invoicing, with its leading AP Automation capabilities and its ecosystem available in the Coupa App Marketplace, helps companies navigate ongoing market changes.
Trend #1: AI is coming to invoicing
Our advice: Leverage AI for your e-Invoicing to automate at scale.
Artificial intelligence has gone mainstream, and you can expect it to become a critical component of effective invoicing. This couldn't come at a more crucial time — organizations are now handling massive amounts of invoice data but often lack the resources to streamline their processes.
AI enables companies to reduce reliance on manual, error-prone tasks and increase invoice processing speed with automation. As noted by Inside Big Data, some financial technology firms say they've been able to reduce invoice processing times from 25 days to just three to five days.
Effectively harnessing AI tools
The most effective way to harness AI tools is already available in your invoicing solution if you use Coupa. Our advanced AP automation capabilities use AI to modernize your AP processes, including AI suggestions for account codes and our AI-driven SpendGuard, which monitors non-compliant spend in real time. Coupa’s InvoiceSmash utilizes AI to extract invoice data from PDF invoices received via email, too.
To tackle other invoice challenges, turn to our pre-built apps, which layer on top of the Coupa platform — all without coding or complex tech management requirements. Take the Relish Invoice AI app, for example. It automatically compares all the fields on invoices against previously seen invoices and other master and transactional data to correctly identify all fields.
Trend #2: Invoice compliance needs are evolving
Our advice: Invest in a leading e-Invoicing compliance solution.
Governments are shifting away from post-audit models to mandated networks and clearance models. Clearance models come with the mandatory use of e-Invoices, and the appropriate tax authority must register all invoices before the buyer receives them. This differs from a post-audit model that sees companies accountable to public administrations after sending invoices.
To reduce their tax gap, this model offers the best advantage for tax authorities since it improves their oversight and control. Clearance models have been prevalent in Latin America for many years, and inspired by their success, Italy became the first country in the EU to adopt this model in 2018. As noted by UN/CEFACT, other EU countries such as Poland, France, and Spain are just a few also beginning to follow suit.
However, this creates a potential challenge for businesses: Tax authorities don't require key business data on invoicing documents, such as PO numbers and contract references. Due to missing key business data, companies may need additional time to find the appropriate information to ensure internal compliance. Coupa Invoicing provides AI-driven capabilities to suggest the correct PO if this information is missing on incoming invoices.
“Companies are preparing for the upcoming changes now, although deadlines are two years out,” says Paul Recchia, VP of Product at Relish. “Leading companies know they need to start the transformation now, but as part of that move, they need help understanding and becoming compliant with the laws. We are receiving questions daily from customers about meeting the impending requirements for government-mandated e-Invoicing.”
Preparing for increased government oversight
To save time and money, companies should proactively satisfy local regulations for electronic invoicing by using invoicing compliance automation. Coupa has an extensive invoice compliance offering, which currently supports 50+ countries. Coupa also monitors the market and updates its compliance processes as tax legislation changes for countries worldwide. Customers that need access to the Peppol network should consider adopting Marketplace partner applications like Valtatech or Routty.
Trend #3: AP as a strategic stakeholder
Our advice: Get empowered to drive your automation strategy.
In 2023, emerging technologies will enable AP to take on a new role as a strategic business stakeholder.
By reducing friction and streamlining operations such as invoice verification, approval, and payments, AP teams can improve supplier relationships, reduce the risk of invoice non-conformity, drive down invoice cycle times, and improve forecasting.
Creating strategic value
AP doesn't have to take a back seat to IT in adopting robust automated solutions. Coupa’s Business Spend Management (BSM) platform empowers teams to manage all of their spend in one place, with invoices connected to not just POs but also contracts, built-in invoice compliance, payment capabilities, and more. In addition, the App Marketplace offers pre-built applications that plug seamlessly onto Coupa’s platform and connect to your existing tools, letting AP reap the benefits without retraining on new processes.
"AP teams can take a leading role in reducing process complexity by plugging in pre-built applications that make it possible to build and manage invoices on a per-supplier basis," says Thomas Anderson, Senior Director of Product Strategy at Kofax. Kofax AP Essentials helps suppliers capture invoices through multiple channels — ensuring paper invoices are extracted and passed to Coupa efficiently. "By leading the charge to automate key processes such as data capture and invoice generation, AP teams can save their companies time and money."
Taking on business invoicing trends in 2023
Invoicing technology is changing at a rapid speed. From the adoption of AI to changes in compliance to the addition of automation into key AP processes, Coupa Invoicing, with the extension of applications from the Coupa App Marketplace, helps finance teams take control of their AP strategy and embrace 2023 trends on their terms.