Using Blockchain for invoicing, will this work?
Hello Steemians,
I am a newbie in the block chain and cryptocurrency stuff. My recent research on the internet and insights from various experts on block chain mechanisms, I understood the mechanics of block chain.
Myself a young entrepreneur from India, completed my masters in SUNY Binghamton in system science and industrial engineering and returned to join the family business.
Doing some thinking on block chain structure, I think this might help in the current way of purchasing and sales of goods. I don’t know how the mechanism of invoicing works in other countries. As far as I know, in India to purchase some goods, suppose we are a party B and to purchase goods from party A, we need to generate a purchase order and generate a way bill to certify the transport of goods to receive at party B, in the same way to sell goods you need to generate a sale order. With the current mechanism, there is a lot of paper work and records must be kept for at least 5 to 6 years as proof of purchase and sale. These records are also stored in government departments to verify the purchase and sales of goods. By the way, all these records are physical paper. Apart from these, there is a monthly, quarterly or a yearly audit on the companies or the trading firms to monitor the authenticity of their business. I have spent around a year in this business habitat, but even in this little time, I am able to witness some transfer of goods without the bill to evade the taxes.
I think, with the help of block chain we can have a transparency of goods movement and goods stock of a company. All the records of purchases and sales are stored in a ledger, just like a bitcoin ledger. These ledgers are stored on the block chain. Being an entrepreneur, I know a lot of people will not feel contented with this transparency in goods to their competitors. To deal with this, now let’s make an individual ledger between a company A and company B, all the transactions that are carried out between these companies are stored in this ledger, this ledger can only be accessed by these companies and the government. With this similar model, I guess there will be lot less work for any organization that are having at present.
I have found similar models on the internet, one of them is Tallysticks by Adi Ben-Ari and Kush Patel. I was impressed by Tallysticks, I do not know how it will work with the credit terms between the companies but this will turn some wheels. This will solve some of the real-world problems. One of the best thing about Tallysticks is that the payment is directly deposited to the lenders account, this reduces the risk for most of the investors.
“When the buyer/debtor eventually pays a financed invoice, Tallysticks routes the payment directly to the lender's bank account instead of the borrower's bank account. So, there is no longer the need to set up a trust/escrow account, and the supplier no longer needs to inconvenience it's buyers about changing payment instructions, which can be a very difficult task. Ultimately, this removes the need for a number of lender imposed mandates that inhibits borrowers from accepting invoice financing.”
With this secured network of block chain, I think block chain invoicing will be a really efficient way to do business.
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