Electronic invoice and payment systems have been slow to catch on, even though they offer enormous promise for cost savings, speed, and transparency in business-to-business transactions. The technology has a lot going for it: It’s getting more robust all the time, and big financial services firms, including American Express and JPMorgan Chase, are partnering with payment software developers to host the systems. But paper still rules. Some 70% of U.S. business-to-business transactions involve paper invoices and checks. The annual cost of managing that exchange comes to some $116 billion, according to a Bain & Company estimate.
A version of this article appeared in the November 2007 issue of Harvard Business Review.
