The Future of Invoicing: Exploring the Immense Potential of Blockchain

An invoice is the most exchanged financial document. It hasn’t undergone any major changes after being confined to the medium of paper, the only major shift in our times was due to the advance of the digital era. Since the rise of digitalization, we have had e-invoices along with traditional paper invoices. Now enter Blockchain, the next disrupter in the field of invoicing.

What is a Blockchain?

A Blockchain in simple terms is a digitally distributed ledger on a decentralized network. Not only is every single block validated by computers on the blockchain network but they are also linked to other blocks chronologically, hence the name “Blockchain”.

How Blockchain Can Change Invoicing

Smart Contracts

With the help of Blockchain, invoices can be turned into self-executing contracts, meaning they trigger payments and verify them as soon as the invoice is received. This accelerates the whole process of invoicing and payment.

Deterring Fraud

Invoices are often tampered with to commit fraudulent activities, The prices are either inflated or deflated to evade taxes, scam an unsuspecting party, or gain other monetary benefits illegally. But with Blockchain, all this will be next to impossible because of the high degree of security it offers. Every transaction and every edit is recorded, and everyone can view the records, this leaves no room for under-the-table activities.

Transparency

As mentioned in the previous section, every block can be traced back to the previous one, and every transaction and edit on the block is recorded. All the authorized parties can access the blockchain, verify, and trace the data, this keeps transparency to the maximum. This makes conducting audits a breeze.

Real World Example

China has already started utilizing Blockchain technology. They have successfully used it to generate invoices for restaurants, subways, and even hospitals among other sectors. Their main aim to push for Blockchain Invoicing was to counter the rising problem of fake invoices in the country.

Embracing Blockchain Invoicing

Before adopting or considering Invoicing through Blockchain, interested businesses and individuals should consider e-invoicing if they are still utilizing traditional invoicing methods.

Electronic invoicing offers a host of advantages compared to its traditional counterparts, once businesses are adapted to that, they will have an easier time switching to Blockchain invoicing. It will also give them enough time to analyze the pros and cons of their invoicing method.

Benefits of Blockchain Invoicing

The use of Blockchain Invoicing greatly brings down administrative costs spent on operational and manual tasks. It boosts cash flow and security, thereby directly influencing the growth of the business positively. The transparency factor will also help build trust with clients and makes it easy to achieve regulatory compliance.

While there are a huge amount of benefits to be reaped by adopting Blockchain technology, there are not many businesses willing to risk it on new technology, and there are not many companies working on this tech. But at the rate it is going right now, the time when businesses rush to adopt Blockchain technology isn’t too far.