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My e-Journey - over 40 years. Part 3. Interconnecting customers

Especially in the Nordea Bank stage we started to think that the then 4 million strong e-Banking user habit and trust should be reused for other interaction purposes than traditional payments and other banking services. With 10 million private and 1 million corporate customers there must be an enormous customer  and societal value in interacting also with secure e-invoicing, e-salary, e-identification and e-signatures as this could be done with trusted and familiar e-banking tools. Connecting customers = e-banking 3.0...

Besides there are no corporate customers - only human customers in different roles. Learn once and use at home and at work. E-identification and e-invoicing served senders and receivers in all roles and in all sectors - just like payments. When ready habits and trust are integrated in new services adoption happens much faster - especially today when the tsunami of things happening, is further cutting down time available and the 8 second attention span left.  

The first new Interconnecting customers service was e-identification (-92).  Insurance companies needed strong identification and asked if there could be a back door in the e-bank and a "corridor" to their service where already identified customers could get served right away. All banks followed our example and the public sector recommended widest use of bank-id in 2002. Today it is used 50/50 in public and private sector services on average over 50 times/citizen and it is also used for signing contracts. Especially other Nordic countries also use bank-id. In Finland teleoperators have also launched id-services.  With the coming factwallets where also official ID-credentials can be downloaded much will change further.

The second area of attention was e-shopping. We did establish a "Solomarket" (-96) for e-shops to help sellers and buyers to find each others. The banks other contribution was to provide an account-to-account real time payment (bill payment tool and habit reused). Simpler than card payments and merchants did not have to worry about nonpayments. This is still dominating e-shop payments in Finland even if cards are gaining share.

The third connecting customers was e-Invoicing (late 90s). This started from customers complaining that they had to do the bank's back office work when keying in lengthy reference numbers and other payments details. So somebody asked, should it not be possible to receive an e-invoice in the e-bank and then just approve it for payment on due date by clicking ok. Of course it was - later by replying A to simple text message.

And later e-invoices could be automatically paid with standing order - if wished with set maximum amounts. e-Invoicing thus eliminates the need for a separate expensive and cumbersome direct debit infrastructure. I did try to tell that enterprises will have to send e-invoices in any case (mandatory already in 50 countries for public sectors) in ECB and EU - but failed to stop EU-direct debit. This in spite of EU having invited me to chair the Expert Group on e-Invoicing and we having established a public-private groundbreaking Real Time Economy program. 

e-Invoicing started as a serious improvement in customer experience. It was a pleasant surprise to learn from the Finnish state that e-invoicing in its first incarnation would save 150m€, and from the Municipalities association the same amount and from the Finnish Association of Enterprises a figure of 2,8 billion. Altogether a mission to eliminate over costs of 3billion/year (EU eq some 220bn€ defacto paid by invoice receivers and saving 10 million trees..). And free up scarce workforce from boring routines to valuecreating, interesting and better paid work. Talk about a purpose... Progressive countries are moving to make e-invoices and e-receipts mandatory for all organisations with accounting obligation. France is moving fast...

The next step was e-salary. Simply sending the salary specification as a clickable addition to the credited amount in the e-bank statement. Hardly any printed statements left..

The next target in the Real Time Economy Program was the e-Receipt with a cost saving potential of 0,8 bn€ in Finland. Some progress has been made - but the real breakthrough will come with the coming automatically interoperable ID/factwallets for organisations. More about that later. 

Lessons learned:

(i) user experience and tools should be the same for all roles and reusable tools in all sectors to get fast adoption,

(ii) banks have all it takes to deliver much more value for society at large by interconnecting customers in new ways and should be encouraged to do more (with open interfaces) - not less,

(iii) we did ponder back in the 90s if we should have added also as second back door in the e-bank: customers stepping out with a privacy preserving alias (age, home municipality, address etc only when needed). Other service providers could then have trusted that the person exists and has a legal age. There was not much need then - but we should still have done it.

(iv) we should have had time to calculate how much the banking system's interconnecting customers services saved costs and time and added adoption speed for enterprises, the public sector and households (who of course have to use too much time, travel, and pay every cent of costs in prices and taxes). This would have opened more eyes earlier - how useful a progressive banking sector can be for society at large.

One could have expected strong demand all over EU for the Finnish model where the invoice sender sends only one invoice file to the chosen service provider (often a bank for SMEs) who send the material onward as eInvoices only (no direct debit) and printa and mail the remaining papers. The receiver's service provider (a bank for all consumers) sends the e-invoice and the invoice receiver can use direct-debit-like standing order when preferred (no need to bother anybody else....). For customers who do not use smartphones the e-invoice is sent as direct payment to their account. Enormous cost savings! 

(vi) e-invoicing and e-receipt ecosystems are not cost efficient enough and competion driving  if every service provider across Europe and wider has to sign up with the multitude of other service providers. The model should be an ecosystem where membership in a SWIFT- or Findylike not-for-profit co-operative replaces bilateral contracts.

(vii) EU should elevate itself to higher levels of understanding and sell in open cost saving models (case unnecessary EU direct debit)

I have made over 1000 presentations in 63 countries on e-banking 1.0, 2.0 and especially this 3.0 - with quite good feedback. But how much has been implemented - early enough? Even if international media of all sorts have given much praise for our achievement. Is banking the only sector that does not need to change faster?

With the next phase - the Trust Infrastructure it is especially important for banks to be proactive. Is it not better to be at the table - than on the menu? 








Comments: (1)

Bo Harald
Bo Harald - Transmeri, Demos, Real Time Economy Program,MyData - Helsinki Region 29 December, 2022, 17:42Be the first to give this comment the thumbs up 0 likes


How can we help enterprises to cut costs by automating payment processes?

B2B e-invoicing 4-corner ecosystem introduced.  Cost saving potential in Finland estimated to 3bn€ by Federation of Industries, Municipal Association and State Treasury. Started to feel really important.



Should e-invoicing not be done for the Single Market?  

Real Time Economy (RTE) program launched.  Full SEPA – payments & e-invoicing first target. Direct debit part of e-Invoicing. Not quite there yet..



- Should not entire value chain be addressed?  

RTE – Full Value Chain. (FVC) phase started. Upstream from e-Order to e-Invoice to automated payment.

What can we do for the Single Market?

Chairing EC Expert Group on e-Invoicing. Very important report and influence on new VAT-directive (digital signatuter cannot be mandatory).



How can e-Invoicing automate accounting? 

RTE – Fully Integrated Accounting (FIA) phase started. Downstream from e-invoice payment. Unified Reporting Code created.  Accounting references and ISO20022 standard for e-Invoicing.



Should XBRL not be the European standard and VAT reported automatically? 

RTE FIA2 started.  More to do. No-brainer to make it mandatory. Task for



How could major administrative burden for enterprises – salary, social security and tax reporting and payments be lightened?  

RTE . Fully Integrated Payroll (FIP) started.  Tax taking over – heading for real time national income register and real time taxation in 2019. Real pension and social security payments in 2020.



Can SME administrative burden be cut in half? 

RTE SME50 started.  Yes – together with cutting red tape. Still work to do – but SMEs should work for it themselves also.



How can e-invoice notifications be used to approve payment?  

Nordea press-A SMS launched. Huge success.



How could paper receipts from POS be made structured – to automate accounting?  

RTE Taru program started. Cost saving potential in accounting in Finland 900m€/year. Now key area in RTEco.



Bo Harald

Bo Harald

Chairman/Founding member, board member

Transmeri, Demos, Real Time Economy Program,MyData

Member since

04 Nov 2008


Helsinki Region

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