A Treasury Department push for electronic invoicing for federal contractors could speed payments and save the government $450 million a year, the government says.
Treasury, which purchased about $6 billion in goods and services last year, is mandating that by 2013 its offices and bureaus must receive invoices from vendors via its new Internet payment system.
Because most U.S. agencies still rely on paper invoices, government-wide adoption of electronic billing could cut payment processing times in half, accelerate cash flow for vendors, and reduce late-payment interest charges. Those innovations would save the government $450 million a year, according to a Treasury statement issued on July 13. The government paid contractors a total of $532 billion in fiscal 2010.
Treasury said its bureaus and offices, whose roles include processing tax returns, seizing terrorist assets, printing U.S. currency and regulating banks, would save $7 million a year by using the platform, which is maintained for Treasury by the Federal Reserve Bank of Boston.
The Defense, Interior and Agriculture departments already use electronic invoicing. Interior, the Social Security Administration, and Agriculture’s Forest Service use the new system, known as the Internet Payment Platform, said Adam Goldberg, director of the Treasury’s Office of Financial Transformation and Innovation, formed last year. The Justice Department and the Census Bureau, which issued a request for industry input on electronic invoicing last month, have expressed interest.
-Nishad Majmudar, WashingtonPost.com