---
title: "What is e-invoicing, and how do electronic invoices work?"
description: "E-invoicing is the digital exchange of invoices, automating the process, reducing errors and costs, and increasing efficiency."
url: https://www.fenerum.com/en-DK/dictionary/e-invoicing/
---
## What is e-invoicing?

### The meaning of e-invoicing

E-invoicing is an electronic method for sending and receiving invoices between businesses. It makes the process
faster, safer, and more efficient. By using e-invoicing, businesses can avoid many of the errors and costs often
associated with manual invoicing systems.

You can handle e-invoicing yourself by email or use a system that ensures the invoice reaches the recipient. Many
providers offer solutions for this.

_Mockup of what an e-invoice could look like in [Fenerum](https://www.fenerum.com/en-DK/index.md)._

## How does e-invoicing work?

The sender creates an electronic invoice in a standardized format and sends it to the recipient through an
e-invoicing platform. The recipient's system receives and processes the invoice automatically, ensuring correct
integration with the accounting system. E-invoices are stored digitally, making the documents easy to search and
archive. Many businesses use [SaaS solutions](https://www.fenerum.com/en-DK/dictionary/saas.md) with integrated e-invoicing functionality. These
solutions can make e-invoicing simpler and more accessible, as [Fenerum](https://www.fenerum.com/en-DK/index.md) does.

## Benefits of e-invoicing

1. **Efficiency and time savings**: E-invoicing automates many of the processes associated with traditional invoicing.
   This reduces manual data entry and minimizes the risk of errors.
1. **Fewer errors**: Manual invoice entry can lead to mistakes. E-invoicing reduces this risk through automated
   processes and standardized formats, helping ensure that information is accurate.
1. **Faster payment cycles**: E-invoices can be delivered immediately, allowing them to be processed sooner and
   shortening the payment cycle. This can improve cash flow and reduce the time between invoicing and payment.

## What information must an electronic invoice contain?

An electronic invoice must include essential information similar to a traditional invoice:

- **Sender**: Include the company's name and company registration number.
- **Recipient**: Include the recipient's name and company registration number where applicable.
- **Issue date**: State the date the invoice was issued.
- **Invoice number**: Include a unique invoice number for internal use.
- **Goods or services**: Describe the goods or services, quantity, and price.
- **VAT amount**: State the total VAT amount.

Creating an electronic invoice is similar to preparing a paper invoice; the difference is that the process takes place
digitally through email or an accounting system.

## Understanding e-invoicing codes and numbers

For e-invoicing in Denmark, businesses need to know several important numbers and codes:

### EAN number

This number is essential for sending and receiving e-invoices in Denmark. It is a unique number assigned by Statistics
Denmark and used to identify businesses in the e-invoicing system.

### GLN number

A Global Location Number (GLN) is an international standard used to identify suppliers and customers precisely.

### P number

A P number is a ten-digit production unit number assigned to a business together with its CVR number when the business
is established. It is often required to process e-invoices correctly.

### CVR number

A CVR number is an eight-digit number that uniquely identifies a Danish legal entity. For businesses, it serves a
similar identifying purpose to the CPR number used for individuals.

## Implementing e-invoicing in your business

For many businesses, moving to e-invoicing can seem complex. It is important to choose an e-invoicing solution that
fits the business's needs and to ensure that all relevant numbers and codes are registered correctly. Many
[SaaS providers](https://www.fenerum.com/en-DK/dictionary/saas.md), including [Fenerum](https://www.fenerum.com/en-DK/index.md), offer tailored solutions that integrate with existing
systems and make the transition as smooth as possible.

## Conclusion

E-invoicing significantly improves how businesses handle invoices. Its increased efficiency, reduced error rate, and
faster payment cycle explain why it is becoming increasingly popular. By implementing e-invoicing, your business can
quickly benefit from these improvements.

For more insights and solutions tailored to your SaaS business, learn more about [Fenerum](https://www.fenerum.com/en-DK/index.md).

## More resources

- [Monthly Recurring Revenue (MRR)](https://www.fenerum.com/en-DK/dictionary/mrr.md)
- [Annual Recurring Revenue (ARR)](https://www.fenerum.com/en-DK/dictionary/arr.md)
- [Churn Rate](https://www.fenerum.com/en-DK/dictionary/churn-rate.md)

---

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