Banks and e-invoicing. Will they play their part? Or go for partnerships?

At some point an invoice needs to be paid. The same goes for e-invoices. And somewhere down that line a financial institution comes in. Banks for instance. Banks have a lot to do with payments. And as e-invoices provide great opportunities to integrate invoice information with payments, you’d reckon that banks all over the world would enter the e-invoicing arena. Right?

Well, a global view shows that banks play their e-invoicing role in North West Europe, some Asian countries, the US and Canada. According to Celent “e-invoicing has failed to gain traction in the banking industry”. Some of their observations:

• The not invented here syndrome
  Many bank IT departments want to build their own solutions, almost regardless of the technology involved. But there are already so many standards and service providers that conquered market share that banks struggle to compete with service providers experience, track record and market share.
• Acquisition strategy
  If you can’t build it, you can buy it. But this also comes with warnings. First recent acquisitions by banks didn’t create the competitive edge that some had hoped for. In fact most bank related e-invoicing acquisition removed these companies as competitors. Second, who do you want of have to buy to achieve your objectives? Players that have any significant scale? Or specialised or niche market service providers?
• To partner or not to partner, that’s the question
  Celent believes that partnering is the best option for banks. With over 700 e-invoicing service providers globally, and tens of thousands of banks that should be possible. But to date there are only few examples of successful partnerships.

We also believe that partnering is the best option for banks. Simply because service provider have the experience, track record, market share, economies of scale and customer sensitivity that banks need to profit from the e-invoicing potential.