A policy brief by the Economic Research Institute for ASEAN and East Asia (ERIA) says the ASEAN e-invoicing market has been experiencing significant growth in recent years. The market registered a compound annual growth rate (CAGR) of 15% from 2021 to 2028 and is projected to have a CAGR of 17.4% by 2030. The market value is expected to rise from $500 million in 2020 to $1.5 billion in 2028.
E-invoicing is a vital component of paperless trading, delivering substantial cost savings and efficiency gains for businesses. It significantly accelerates payments to businesses, saving up to $6 per invoice in processing costs, according to the brief. It also reduces invoice errors by 50%, minimizes disputes, and decreases invoice rejections.
Additionally, e-invoicing offers cost reductions ranging from $1 to $2.09 per invoice. This translates to potential processing cost savings of up to 70% compared to manual or PDF-based invoice processing.
The ERIA policy paper notes that the notable growth of the ASEAN e-invoicing market is being spurred by initiatives from tax authorities, public procurement agencies, and business digitalization programs.
Among these initiatives are the ASEAN Digital Trade Standards and Conformance Working Group, the Bandar Seri Begawan Roadmap, the ASEAN Digital Masterplan 2025, and the ASEAN Digital Economy Framework Agreement. These aim to foster e-invoicing interoperability, establish common standards, and advance regional integration.
However, adoption across the region still faces significant challenges, including disparities in IT infrastructure, fragmented data policies, cybersecurity concerns, and limited private sector uptake.
Overcoming these barriers is essential to building a secure and efficient e-invoicing ecosystem, states the policy paper issued last December.
To address these challenges, ASEAN has introduced initiatives to foster interoperability, develop common standards, and support regional integration.
“By prioritizing standardization, offering government support, and encouraging private sector adoption through financial incentives and capacity-building efforts, ASEAN can accelerate trade digitalization and enhance economic integration across the region,” the publication says.
In the case of MSMEs, while e-invoicing promises sizable savings, adoption is impeded by high implementation costs, information gaps, and limited technical capacity.
These hurdles can be addressed through enhanced outreach, training programs, and standardization to improve private sector uptake. The research authors also recommend the provision of government incentives such as early registration vouchers for MSMEs and financial grants for larger companies implementing IT systems to drive widespread adoption.
To promote e-invoicing interoperability within the region, the report calls for the following strategic actions: promote collaboration and harmonize standards, align regional initiatives with international frameworks, adopt flexible implementation models, develop a standardized e-invoicing format, implement robust cybersecurity protocols, and support private sector adoption through financial incentives and capacity-building programs.
E-invoicing involves the electronic exchange of structured invoice data between a supplier and a buyer. It allows for automatic processing with minimal human intervention. Unstructured formats such as PDF or scanned paper invoices are not true e-invoices, as they do not enable automated data exchange between accounting systems.
January 10, 2025
January 16, 2025
