Malaysian businesses are urgently preparing to apply the e-invoice system from the beginning of August 2024. The latest timeline of IRB (Inland Revenue Board) has also stipulated that e-invoicing is mandatory for all taxpayers, based on their annual turnover. This effort aims to further spread the act of digitizing business operations and improving efficiency.
However, according to several official studies, nearly 63% of small businesses face challenges related to overdue payments. This greatly affects the cash flow as well as the financial health of enterprises. If you don't really understand e-invoicing, this problem can completely happen.
To streamline this transition process, Malaysian business owners have gradually turned to e invoicing software. But what do you need to keep in mind when deciding to use e invoicing software? Which e invoicing software is outstanding and should be used in Malaysia? This article will help you answer those questions.
Why Do You Need an e Invoicing Software?
Surely, you will want to streamline your business's e-invoicing operations in Malaysia as the deadline for implementing it approaches. But why use e invoicing software instead of doing it yourself?
Save Time
E invoicing software speeds up the payment process, creating and sending invoicing with automated operations. Instead of spending hours manually entering data and worrying about its accuracy, you can now create invoices in seconds.
For example, business owners can quickly create invoices using built-in templates to fill in customer details and amounts, then send them for approval in just a few clicks. You can focus more on your business development journey rather than getting bogged down by paperwork.
It's like you're saying goodbye to endless paperwork and hello to more free time - like having an extra set of hands.
Reduce Errors
Setting up e-invoicing manually often leads to errors, such as incorrect dates, incorrect amounts, or missing details. E invoicing software minimizes these errors by automating data entry and calculations. This has been proven by ClearTax, where error rates can be reduced by up to 37% by automating the e-invoicing process with e invoicing software.
Improve Cash Flow
Accurate and quick e-invoicing leads to a faster and more optimized payment process. E invoicing software also includes features such as automatic payment reminders or integration with online payment gateways.
This ensures that your customers receive timely reminders to pay their bills, and they can do so more conveniently than ever through a variety of payment options.
This e invoicing system is like a digital assistant that motivates your customers to pay up - a gentle yet persistent cash flow guardian.
Enhance Record Storage
Managing paper invoices or e-invoices manually will be very complicated and time-consuming. E invoicing software centralizes all your invoices on one digital platform, making it easy to store, retrieve, and track them.
An obvious example is when you need to find an invoice from 6 months ago to double check. With e invoicing software, you just need to go to the search box and select to check invoices by date, by customer name or by amount.
Proper payment record keeping means no more lost invoices or frantic searches through file cabinets.
Ensure Compliance
Complying with tax laws requires you to spend quite a bit of time researching, learning, and putting them into practice when using e invoicing enterprise software. Not to mention the case where you do not have much experience related to the law or important information like e-invoice exemption, leading to confusing or misunderstanding content.
Using e invoicing software will help your business ensure compliance with local tax requirements by automatically applying tax rates correctly and generating compliant invoices.
The software is also updated with the latest tax rules and formats as required by Malaysian authorities. This process reduces the risk of penalties, allowing you to focus on your business with peace of mind.
Important Criteria To Choose The Best-suited e Invoicing Software
Choosing e invoicing software is considered a revolutionary step for your business. However, choosing the right one to achieve efficiency and success also depends on the compatibility of the software with the operating system.
The criteria below, given by our experienced experts in running e-invoicing projects, will help you accelerate this process with confidence.
Ease of Use
The best e-invoicing software for Malaysian businesses at the moment needs to be easy to navigate and use. Look for a user-friendly interface that doesn't require too much in-depth or technical knowledge.
For example, if you can quickly create and send an e-invoicing without reading the user manual more than three times, that's a good sign. It's like driving a car - you want something that intuitively gets you from point A to point B without much fuss.
Integration Capabilities
Your e invoicing software will integrate seamlessly with your existing business and accounting systems. This e invoicing system ensures smooth data transfer, while also reducing the inherent need for manual data entry (which can lead to errors).
For example, integration with popular accounting software like Quickbooks, Xero or integration software like Odoo certainly saves you time and reduces the risk of discrepancies.
Customization Options
Every Malaysian business has unique invoicing needs. So your e invoicing software must provide customization options. Look for software with features that allow you to customize invoice templates, add your branding, and customize payment terms.
If you run a freelance business, you will need specific project details or hourly rates for e invoicing software, rather than a permanent package. This ensures your invoices reflect the professional image of your business and meet specific requirements.
Security and Compliance
Ensuring the security of financial data is what every e-invoicing software needs. Choose software that offers strong security features, such as data encryption or secure payment processing.
Additionally, it needs to comply with local regulations and tax laws. In Malaysia, e invoicing software must be able to generate invoices that comply with GST tax requirements. This e invoicing enterprise software not only protects businesses from data breaches from outsiders, but also ensures legal compliance.
Toplist: 5+ e Invoicing Software You Should Try
To optimize the e-invoicing software selection process, you should refer to the suggestions below. They are outstanding softwares in the Malaysian market as the e-invoicing solutions for your enterprise, tested for at least 6 months by our team of experts.
Odoo
Odoo provides a comprehensive e-invoicing solution that integrates seamlessly with its ERP system. One of its outstanding strengths is its automation capabilities. Unlike using the usual portal, where manual data entry can be time-consuming and error-prone, Odoo automates the entire invoicing process. You can create, send, and track e-invoices with minimal effort, and significantly speed up your workflow.
Odoo is also designed to meet local e-invoicing standards. This can be considered a challenge with other systems such as SAP or Oracle. This local specialization ensures the invoicing process complies with Malaysian regulations. It also includes integration with the government's PEPPOL network.
Ongoing support from Odoo partners like A1 Consulting also helps you quickly resolve compatibility issues. It ensures every problem can be resolved quickly, smoothly and effectively.
Invoicera
Invoicera is not just a regular e-invoicing software, but it also simplifies payments and improves business efficiency. Invoicera allows users to easily navigate and use without much technical skills with an extremely intuitive interface.
Invoicera's automation capabilities are also impressive, eliminating repetitive manual tasks, ensuring accuracy, and saving time.
This e invoicing software also integrates with more than 14 online payment gateways, speeding up the payment cycle, and helping customers pay online conveniently. Its customization options tailor invoices to reflect your brand identity, while helping you track invoice status in real time and make informed financial decisions.
ERPNext
ERP Next offers powerful e-invoicing capabilities. It can handle the import of XML files containing e-invoices from suppliers, which are generated in compliance with governmental requirements. When these XML files are uploaded, ERPNext will also automatically create suppliers' profiles - including names and addresses - and records the purchase invoices into the system.
ERP Next's e-invoicing features have been steadily developed in both V12 and V13. This platfrom also integrates an API gateway to optimize the e-invoicing process of Malaysian businesses right from the start.
Zoho Invoice
Zoho Invoice stands out for its seamless integration with the Zoho suite of business tools. These e invoicing software solutions have a streamlined process that allows you to create quick and professional invoices automatically.
This e invoicing software also excels at expense management, allowing you to organize an invoice on one unified platform. Its banking integration feature excels as it allows you to link your Zoho Books account with your bank, providing direct cash flow and instant transaction categorization.
Zoho Invoice provides in-depth financial reports to its users, such as profit and loss statements, balance sheets, cash flow statements, etc. They help you have a clear view of your business's financial situation when performing e-invoicing.
Freshbooks
Freshbooks is especially for small businesses and freelancers with a user-friendly interface and powerful features. You can tailor it easily with automatic recurring options, allowing for quick modifications based on customer needs.
Furthermore, Freshbooks offers automatic payment reminders, which help you maintain cash flow by reminding customers to pay on time. Online credit card payment support is also guaranteed to be seamless with smooth transaction operations.
Intuitive business insights in general are also provided by Freshbooks through comprehensive reports and dashboards, helping to make informed decisions.
Xero
Xero stands out as a popular cloud-based accounting solution with comprehensive features, including robust invoicing. It also excels at bank reconciliation and expense tracking, as well as supporting scheduled recurring payments.
Xero's automated payment reminders help speed up the customer payment process by sending tailored emails to remind you of pending invoices. Various payment e invoicing software solutions include debit/credit cards and Paypal, or pay directly from the invoice, enhancing cash flow management.
Mobile invoicing capabilities also let you create and send invoices instantly across a variety of devices.
Tips to Streamline Your Business with e Invoicing Software
Efficiency is the key to staying competitive, and that's a given when using e invoicing software. Of course, if you know our 5 tips below, you will enjoy a more valuable e-invoicing process than ever before.
Establish Clear Procedures and Instructions
Define standardized processes for creating, approving, and sending invoices using e invoicing software. Make sure all your team members understand their roles and responsibilities to maintain consistency and accuracy in operations.
Optimize Invoice Design
The e-invoicing design should have a clear layout, including essential details such as invoice number, due date, itemized fees, and payment terms. Work closely with the e invoicing software provider to ensure readability of e invoicing across different devices and formats, avoiding delays in the payment process.
Monitor Payment Trends and Customer Behavior
Analyze payment trends and customer behavior with the reporting capabilities of e invoicing software. Identify patterns such as late payments or discrepancies to adjust your credit management strategy, and improve cash flow forecasting.
Regularly Review and Optimize Workflows
Periodically review your invoicing process to identify bottlenecks or inefficiencies. Collaborate with stakeholders to streamline processes, eliminate redundant steps, and leverage automation features to improve overall efficiency.
Stay Up To Date with e-Invoicing Software Enhancements
Be sure to stay informed about updates, new features, and best practices offered by your e invoicing software vendor. Incorporate these innovations into your workflow to take advantage of the latest technological advances from e invoicing enterprise software and improve operational efficiency.
Final Thoughts
Taking advantage of e-invoicing software to optimize electronic invoice operations is what Malaysian businesses should consider. Time, money, and effort will all be spent smarter than ever when choosing the right e-invoicing software.
Of course, it is not difficult to understand that you have difficulties in clearly defining your needs with e-invoicing software. That's why we, A1 Consulting, are still here to help you. As a trusted Odoo partner in Malaysia with a diverse range of experts who have completed many successful e-invoicing projects in Malaysia, we are committed to helping you choose and take full advantage of e invoicing software.
Contact us immediately for more detailed information and advice about e invoicing software!
