USA Digital Business Networks Alliance (DBNAlliance E-Invoicing)
Digital Business Networks Alliance (DBNAlliance) formed by the Business Payments Coalition (BPC) has allowed for electronic invoice exchange in the USA.
Last modified on 2023-08-16 in Countries
OASIS UBL
DBNAlliance
IRS
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7 years
The Digital Business Networks Alliance (DBNAlliance) was formed by the Business Payments Coalition (BPC) Market Pilot participants and is the North American counterpart to the European Peppol network. Its aim is to improve the efficiency of the invoicing process and streamline communication between entities (B2B) in the USA.
Starting in the summer of 2023, the BPC and the American Federal Reserve launched their exchange framework, which began the first nationwide standardized e-invoicing system in the USA.
The Business Payments Coalition (BPC) works to advance straight-through processing (STP) and digitalization of business-to-business payments. Promoting the use of electronic invoices (e-invoices) and automated remittance data processing (e-remittance) are important actions to help achieve that goal.
The BPC also encourages the implementation of the ISO 20022 payment message standard as a crucial component for enhancing worldwide interoperability, treasury management efficiency, and customer experience.
The BPC seeks to assist the transition of the sector from paper-based to electronic invoices as part of its efforts to modernize business-to-business (B2B) payments. Businesses can benefit from digitalization's cheaper costs, better cash management, error reduction, risk mitigation, more transparency, and improved automation of business processes by using electronic payments.
There are a few aspects of the e-invoicing implementation that the DBNAlliance is tasked with, including establishing the electronic delivery network in accordance with US policies, regulations, standards, and norms for exchanging business-to-business invoices.
The DBNAlliance is used for the transmission of e-invoices for B2B transactions, as B2G e-invoicing is not yet possible as public entities are not required to process and receive e-invoices in the USA.
The format used is OASIS UBL which is also utilized by many other countries around the globe such as Croatia and Montenegro. This format includes standard invoice information such as supplier details, shipping information, payment details, and applicable taxes payable.
E-invoices in the US must be archived securely for 7 years, starting from the tax return filing.
The DBNAlliance provides a membership-based service for businesses to join the exchange framework through certified access points such as DDD Invoices.
Due to the technical standards set in place, suppliers are not required to use the same access point as their buyers, and vice versa.
There are a variety of electronic payment methods that are supported through the use of the DBNAlliance:
Automated Clearing House (ACH) and modernized electronic payments such as e-invoicing
Instant payments
Wire transfers
Card payments
The centralized platform had an e-invoice exchange market pilot program in the United States that was conducted in three phases.
This was the initial stage that set the details of the framework, such as the rules and specifications, in order to make the process possible.
The DBNAlliance system was implemented in business, and e-invoices were transmitted in order to evaluate how the process works in the real world.
This phase was centered around increasing the use of e-invoices. Due to its success, this system will be available to all American businesses by 2024.
The DBNAlliance exchange framework is made up of a 4-corner model that enables the exchange of invoice data through a secure virtual network and non-proprietary technical standards. It consists of three major groups that facilitate the exchange framework.
Supplier
Buyer
Access Point service providers
To make B2B electronic payments widespread in the US, we need a standard way for businesses to send electronic invoices and payment details. An exchange framework is like an electronic network that follows rules to let businesses safely share supply chain documents. This framework makes payments faster by changing manual processes into automatic ones.
In this network, service providers help businesses send and receive data securely. This setup lets them find and connect with each other while keeping things private. The goal is for these exchanges to handle both invoices and payment details and make the whole process seamless. The infographic below explains how exchange frameworks make it easy to share e-invoices and payment data.
The electronic exchange network has already announced its plan to implement this system in all businesses by 2024. In preparation, businesses should get ready to make the transition as smooth as possible for their employees and customers.
Although this process is initially being implemented in B2B transactions, it is very likely that the scope will expand to include both B2G and B2C transactions.
Want to connect to DBNAlliance and don't know how? Here are the benefits of choosing DDD Invoices as your DBNAlliance Access Point:
Unlock the ability to send and receive e-documents worldwide, without worrying about local compliance issues. Through our API, we automatically fill in your invoice data and send the invoice to the proper authorities, letting you focus on your core business processes and we manage the bureaucracy.
Seamlessly integrate into your current invoicing system, ERP or CRM in as little as one day. Enjoy an error-free and automated invoicing process through our secure and reliable service.
DDD Invoices is an enterprise-grade platform delivering a powerful infrastructure for creating, sending, receiving and storing electronic documents. DDD Invoices enables software providers like ERPs, SaaS, eCommerce, POS systems, accounting & invoicing softwares, billing services and others, to easily adhere to global invoicing compliance requirements and shorten their time-to-market.