Cross-border paperless trade has been plagued by challenges such as lack of interoperability of national trade facilitation processes, varying standards and formats, lack of mutual recognition of signatures and certificates, and e-authentication issues. Within India, paperless trade is moving slowly due to multiple reasons. India can set an example by moving towards digital invoicing for its domestic trade. Online is no longer ‘a’ medium. It is ‘the’ medium of convenience and accessibility. Shoes, clothes, vegetables, groceries, furniture, and even medicines — the average Indian consumer is adopting online gradually. The discounts, convenience, ease of returns, provision of EMIs and cash on delivery, and a mind-boggling array of goods have made it as appealing as offline markets. The numbers clearly reflect this shift.

India has more than 185 million online shoppers currently, and this is expected to increase to 425 million in 2027. Riding the wave of online orders, India’s e-commerce market is expected to reach $200 billion by 2026. The numbers would be good news for people who support transition towards a greener, cleaner and sustainable world. Growth in e-commerce presents an excellent opportunity to replace paper invoices and receipts which, today, still accompany the soft copies of these documents.

Paper may be environmentally friendly, but it still places a huge burden on the planet. That sheet of paper, which is so recklessly tossed out, requires five to ten litres of precious water to make. And its fate is to end up in the landfill with tonnes more of its tribe, contributing 26 per cent of the total waste in the dumps. Producing one tonne of new paper claims almost 50 trees. Each of those trees could easily produce enough oxygen to sustain three human beings.

While the correlation between paper and oxygen-producing trees is known to all, few know that when paper rots, it emits methane gas which is 25 times more toxic than CO2.

Now consider the fact that of the 17 billion cubic feet of trees deforested each year, over 60 per cent are used to make paper. Deforestation is unquestionably a major contributor to climate change, producing 6-17 per cent of global greenhouse gas emissions. Even though it is nearly impossible to estimate what percentage of this carbon footprint can be attributed to the receipts printed by e-commerce firms, every possible effort must be made to save paper.

Provision of paperless billing is one of the easiest steps in that direction. Apart from environmental reasons, e-receipts also make for a practical alternative.

From the consumer’s point of view, unlike the paper receipt which will fade with time, e-receipts will always be available for convenient access and review irrespective of geographical location. From the e-commerce sellers’ perspective, it will reduce operational costs by 1-3 per cent, cutting down expenses incurred on printers, papers, ink cartridges, storage, besides manpower and energy. Moreover, it is not only about the receipts in the delivery boxes but also the printed invoices that must be carried along with the shipments.

Hurdles ahead

Despite prudence weighing in favour of e-invoicing, the road ahead has its fair share of hurdles in terms of regulatory compliance. Appropriate amendments would be required in GST law to enable voluntary adoption of e-invoicing for B2C transaction and acceptance of digital invoices on a device (mobile/tablet) at interceptions/check-posts to fast track the paperless adoption in the economy. By transitioning to paperless invoicing, the delivery partners and the ecosystem can avoid printing in triplicate (for recipient, transporter and supplier).

Government authorities at the check-posts can verify the invoices through the QR code of e-invoice in the devices held by drivers. Interestingly, countries such as Canada, Singapore, Brazil, Australia and Malaysia have already taken a lead in this respect.

In 2021, Brazil merged several tax and transport documents and instituted the Electronic Transport Document (DT-e), a single freight digital document under a unified national paperless platform. Malaysian, Canadian as well as European laws have made printing of invoices optional. Paperless invoicing is indeed the need of the hour in this rapidly digitising world. And it is an opportune time for India to make the shift.

The principle of digital invoicing is completely aligned with the government’s Digital India Programme, which has created a robust digital infrastructure in the last nine years. It fits seamlessly and can further help in expanding India’s digital technology capabilities and the digital economy. While digital invoices will reduce the transactions costs for MSMEs, it will also enable easier access to financial credit due to presence of chronological trail of documents.

Digital invoicing can also hugely contribute to India’s National Action Plan on Climate Change (NAPCC), especially its flagship National Mission for a Green India (GIM), and thereby achieve the Sustainable Development Goals by 2030. It is an idea whose time has come.

Chanda is Director of Trade, Investment and Innovation, UNESCAP, and Somareddy is VP, Emerging Markets, Seller Experience and Global Trade, Amazon (US and India)