8 Ways How e-Invoicing is Helping Businesses in Keeping a Check on Purchase Invoice Frauds

1. 8 Ways How e-Invoicing is Helping Businesses in Keeping a Check on Purchase Invoice Frauds How E-Invoicing Helps in Identifying Purchase Invoice Frauds

2. 1. Removes Paper Invoices: • One of the most significant benefits of e-invoicing under GST is that it eliminates the need for paper invoices. Even if the parties need an invoice copy in paper format, a government generated B2B QR Code is mandatory to be put on the invoice copy. This makes each invoice unique and verifiable. This reduces the risk of invoice counterfeiting and other forms of fraud.

3. 2. Removes Duplicate Invoices: • Sometimes, taxpayers may receive duplicate invoices from their suppliers mistakenly or may be intentionally. All e-invoices under GST (as per current threshold) are mandatory to be registered on the Invoice Registration Portal (IRP) and carry a unique Invoice Reference Number (IRN), hence this enables businesses to validate the authenticity of invoices and detect any discrepancies. One way to authenticate e-invoices is use of IRIS Peridot.

4. 3. Identify Fake Invoices: • One of the main benefits of e-invoicing is that it allows for real-time tracking and monitoring of invoices. This means that businesses can quickly and easily identify any discrepancies or issues with an invoice, such as duplicate payments or incorrect amounts. This is especially important when it comes to preventing purchase invoice fraud, as it allows businesses to quickly detect and respond to any suspicious activity.

5. 4. Reduce Errors:  • One of the major advantages of e-invoicing is that it reduces the chances of human errors and mishaps drastically. With E-invoicing, the information can be directly populated in the billing systems and all the data is maintained safely thus reducing errors. E-invoicing enables businesses to automate their invoice processing and reduce the risk of human error.

6. 5. Reduce ITC Fraud: • One of the major advantages of e-invoicing is that it reduces the chances of human errors and mishaps drastically. With E-invoicing, the information can be directly populated in the billing systems and all the data is maintained safely thus reducing errors. E-invoicing enables businesses to automate their invoice processing and reduce the risk of human error.

7. 6. Preventing Technological Frauds: • E-invoicing enables advanced security measures like digital signatures, encryption, and secure authentication. Encryption and authentication methods safeguard financial information from unauthorized access, while digital signatures verify the sender's identity and prevent tampering. These measures protect sensitive financial data from hackers and malicious individuals. E-invoicing software also offers fraud detection algorithms that identify suspicious activity and notify businesses of potential fraud.

8. 7. Interoperability Helps Reduce Manual Errors: • E-invoicing can not only provide a secure, digital trail of all invoices and payments but also streamlines pre-invoice generation process. Companies will not have to do back and forth with their suppliers and vendors as correcting and re-sending invoices via emails will be stopped resulting in smoother flow.

9. 8. Preventing Frauds With Faster Response Time:  • E-invoicing will improve collaboration and communication between businesses and their suppliers and customers, helping to build stronger relationships and increase trust and transparency. It will facilitate real-time tracking and monitoring of invoices and payments, allowing businesses to quickly detect and respond to any potential fraud.

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