Volume 8, Issue 7, July – 2023 International Journal of Innovative Science and Research Technology

ISSN No:-2456-2165

A Novel Approach for Invoice

Management using Blockchain
Nikhil Sontakke1 , Shivansh Rastogi1, Sejal Utekar1, Shriraj Sonawane1
1
Department of Computer Engineering, VIT Pune, India

Abstract:- Electronic invoicing is another area where Nakamoto. [3]. Since then, the idea of blockchain has developed
blockchain technology is being used. Additionally, it has the into one of the most anticipated technologies of the twenty-first
power to alter how payments are made, invoices are issued, century, with potential uses in a variety of sectors including
and transactions are validated. Using a blockchain-based finance, supply chain management, and healthcare.
invoicing system will enable smooth payments from a
customer's digital wallet to a business's digital wallet. Blockchain is an integrated innovation of already existing
Transactions are simple to track and monitor, and the technologies, not a disruptive one. It combines smart contracts,
blockchain may be used to retrieve an exchange's full distributed storage, consensus processes, and data encryption [6].
history. Sometimes shopkeepers create fake bills and A chain of blocks, each containing a collection of transactions, is
submit them to the higher tax-paying authorities. To bring formed by the blockchain technology. Each block is linked to the
transparency to this billing system between customers, one before it, creating a permanent record of every network
shopkeepers, and tax-paying authorities “billing system transaction. The decentralized nature of the blockchain ensures
using blockchain” is to be implemented using the concept of that the ledger is tamper-proof, as any changes to a block would
Blockchain and make the billing system in our country be immediately apparent to all parties on the network.
work smoothly. Blockchain technology can revolutionize the
invoicing and payment process by providing a secure, Low cost was cited by 52% of reviewers as the primary
transparent and tamper-proof system. A blockchain-based advantage of electronic invoices (e-invoices). Each paper invoice
billing system can facilitate smooth payments, allow for exchange costs e7, whereas e0.3 is charged for exchanges in
easy tracking and monitoring of transactions, and provide a electronic format, a 25-fold cost reduction. Additionally, each
tamper-proof history of all exchanges. The use of individual can only process 6,000 paper bills annually, whereas
blockchain can prevent fraud and increase transparency an individual can issue up to 90,000 invoices in electronic form.
among customers, shopkeepers, and tax-paying authorities. E-invoices will be successfully merged by the automatic digital
Furthermore, it can streamline the process by using digital system, which uses the e-invoice as input data [7]. Traditional
wallets for both customers and businesses, reducing time payment methods are sometimes opaque, relying on paper, and
and resources for traditional invoicing methods. Overall, leaving little or no audit trail. Debtors can easily avoid paying
blockchain technology can bring greater efficiency and their debts by hiding behind bureaucracy or claiming that their
trust to the billing system, benefiting all parties involved. It claims have been delayed or lost. So using blockchain
can prevent fraud, increase transparency and streamline information can be accessible at each step of the transaction and
the invoicing and payment process. This technology can transparency can be provided.The number of parties involved in
create a more secure and efficient billing system ultimately the product transportation process and the number of handoffs
benefiting all parties involved. that occur many times en route add to the complexity of global
trade. Building end-to-end shipping visibility becomes quite
Keywords: Blockchain, Technology, Invoicing, Supply Chain, difficult. Therefore, for the purposes of creating invoices,
Transactions, Secure, Decentralized, Bill Management Systems. handling disputes, and settling payments, shippers and carriers are
engaged to collect as much information as possible [5].
I. INTRODUCTION
One of blockchain technology's most promising applications
Almost all facets of modern life are made easier by is the usage of bill management systems, which can increase
technology advancements as all nations embrace the 4.0 efficiency and trust in the system by offering a safe and
industrial revolution. New developments brought forth by the transparent means to record and verify transactions. In traditional
technology's quick development offer enormous potential for bill management systems, it is easy for fraudulent activities to
market and commercial expansion [9]. Blockchain technology take place, such as shopkeepers creating fake bills and submitting
is a distributed, decentralized digital ledger that securely and them to tax-paying authorities. Blockchain allows for the
openly records transactions. The technology that serves as the recording of all transactions on a distributed ledger that is
foundation for the virtual currency Bitcoin was first unveiled in available to all parties. By doing this, all transactions are recorded
2008 by a person or group of persons named as Satoshi in a visible and unchangeable manner, virtually eliminating the

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Volume 8, Issue 7, July – 2023 International Journal of Innovative Science and Research Technology
ISSN No:-2456-2165
possibility of fraud. Furthermore, blockchain technology can technology. The blockchain has revolutionized the way
also help to streamline the bill management process. Digital businesses are conducted because it is a transparent system of
wallets can be used for both customers and businesses, money exchange. In the next five years, the blockchain market is
allowing for easy and efficient payments. This can help to predicted to be worth over 3 trillion dollars thanks to major
reduce the time and resources needed for traditional bill investments from tech giants and corporations. The network
management methods, such as printing and mailing paper consists of a digital ledger in a peer-to-peer network. It is gaining
bills.The use of blockchain in bill management systems can popularity because of its security and capability to solve digital
bring greater transparency and trust between customers, identity issues.A simple introduction to blockchain technology is
shopkeepers, and tax-paying authorities.Additionally, it can aid given in this application-based study by Arijit Chakrabarti and
in lowering the expenses and administrative strain connected to Ashesh Kumar Chaudhuri. Additionally, it explores how
conventional bill management systems. The technology can blockchain technology might greatly benefit customers and
help to prevent fraud and increase transparency, while also retailers by being applied to some business operations in the retail
streamlining the bill management process. industry. The research highlights some of the challenges as well
as the use of blockchain technology [3].
Despite the many advantages of blockchain technology,
there are also some challenges and limitations to its In a recently published application-based research article,
implementation. Scalability is a major issue because the Nam Ho Kim, Sun Moo Kang, and Choong Seon Hong proposed
network can currently only handle a certain amount of a mobile charger billing system for electric vehicles that makes
transactions. Another challenge is the lack of standardization use of Blockchain technology. Peer-to-peer online transactions
and regulation, which can make it difficult for businesses to are now more secure because of the application of this
adopt the technology. technology. Additionally, they examined the billing needs for
mobile chargers and put up a lightweight solution to the problem
Finally, the advancement of blockchain technology has of data size in the current Blockchain [4]. A blockchain-based e-
the potential to fundamentally change the way in which bill invoice system for goods carriers is suggested in the paper
payment systems function. By providing a secure, transparent "Blockchain Based e-Invoicing Platform for Global Trade" by
and tamper-proof system, blockchain technology can bring Krishnasuri Narayanam, Seep Goel, et. al. It intends to increase
greater efficiency and trust to the bill management process. But the effectiveness and reduce the expenses of the e-invoicing
there are also difficulties and constraints with its application process. The system promises to decrease disputes, expedite
that must be resolved. In order to understand the potential of dispute settlement, and enable real-time auditing by using real-
blockchain technology for bill management systems, this time shipment tracking data and pre-agreed service contract rates
research study will look at both its advantages and to generate invoices. The motivation for organizations to adopt
disadvantages. The paper will also discuss current such a system is to improve the overall efficiency and cost-
developments and real-world examples of blockchain-based bill effectiveness of global trade[5].
management systems, and provide insights into the future of
this technology in this field. Blockchain technology may effectively address the
problems of intermediaries' trust risk, reduce transaction costs,
II. LITERATURE REVIEW and boost synergy efficiency in a multi-agent context, according
to Liu Xidong. The viability of using blockchain technology to
From the standpoint of OSCM, Rosanna Cole, Mark create electronic invoices is discussed in this article, along with
Stevenson, and James Aitken looked into blockchain the general layout of the blockchain for electronic invoices. In the
technology. This article aims to lead to more research into study, it is also recommended to build an alliance chain for
blockchain technology from a management and operations electronic invoicing and employ intelligent contracts to put
perspective. Research agendas for the future will be developed research ideas into practice for various alliance transactions [6].In
based on identification of potential application areas. Different this paper, Van-Cam NGUYEN, et. al suggest a method that
techniques, including strengthening product safety and security, uses Blockchain smart contracts to digitize invoices and calculate
enhancing quality management, lowering unauthorized VAT automatically. The smart contract was created on the Remix
counterfeiting, and enhancing sustainability, are possible to IDE using the Solidity programming language and the Ethereum
apply blockchain to OSCM operation. Additionally, it can platform. According to empirical findings, the new model has
decrease the need for middlemen and enhance supply chain cheap costs for digitizing invoices and figuring VAT. Our
interactions in a way that lowers costs. Inventory management suggested strategy also lowers the danger of data loss attacks,
and replenishment can also be improved [1]. Simanta Shekhar which increases the credibility of the implementation of VAT
Sarmah provides background on Blockchain technology, its payment (nonaffection from the third party) [7].
history, its architecture, its advantages, and its applications in a
number of industries in this research-based paper where he E-commerce system security, openness and trust, efficiency,
discusses Blockchain technology, its history, its architecture, its and other specific challenges are now being addressed by the
workings, and its advantages and disadvantages. A major industry. These problems can be solved by implementing
technological innovation in recent years has been blockchain blockchain technology in the e-commerce industry. The potential

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Volume 8, Issue 7, July – 2023 International Journal of Innovative Science and Research Technology
ISSN No:-2456-2165
uses of blockchain technology in the e-commerce industry were appealing technology for resolving existing issues in the financial
discussed in this paper. Examined in relation to blockchain and non-financial industries because of its distributed ledger
applications and possibilities are several aspects of e- functionality and security.BlockChain-based business apps are
commerce, such as payment, security, supply chain, work quite popular, and as a result, many start-ups are developing
automation utilizing smart contracts, and ethical standards for them. The adoption will undoubtedly encounter the previously
transparency in e-commerce transactions. [8] indicated severe headwinds. But even major financial
This study examines how a VAT system can use organizations like Visa, Mastercard, Banks, and NASDAQ are
blockchain technology, especially for electronic invoices (e- making investments to investigate how to use current business
Invoice). This study used a qualitative methodology to explore models on BlockChain. In fact, several of them are looking for
blockchain technology models that could be used in a VAT fresh company ideas in the blockchain industry. [14]
system. The study's findings indicate that taxpayer data that
doesn't need to be private can only be stored via blockchain For SMEs to manage their liquidity concerns, factoring—
technology. One example of data that is deemed secure if where the invoice is cashed to prevent late payments from
distributed across nodes in the blockchain technology network customers is a critical financial tool. Unfortunately, the fact that
is the Tax Invoice Serial Number (TISN) [9].Chang, Yi-Wei, this business model relies on relationships with others and that the
et. al. created an online marketplace powered by blockchain. people involved in this case suffer from knowledge asymmetry
They processed the money and secured the deposit using the make it unsafe. "Double funding" is one of the issues. which
self-enforcement of smart contracts. Each transaction is occurs when a SME draws money from several sources. They
recorded in the decentralized ledger and blockchain-verified. have proposed a system called DecReg that is built on blockchain
Thus, trustless transactions are made possible. Without the technology in order to lessen this disparity and improve the
involvement of reliable third parties, the smart contract can scalability of this crucial instrument. We give performance
carry out reliable transactions, and blockchain transactions are analysis together with the protocols created for this framework
traceable and irreversible. The blockchain stores all processes, .[1]
including the introduction of the goods, the purchase, the
delivery, and the payment. When a transaction dispute arises, it III. SYSTEM DESIGN
can be logged and utilized as electronic evidence in court [10].

This study looks at how smart contracts and blockchain

technology can be used to efficiently bill for government
services. The report also evaluates a number of government
agencies and services to choose the appropriate blockchain
type. Implementing blockchain and smart contracts reduces the
problem of duplicate billing and payments, but it also has the
potential to revolutionize the process by increasing the
transparency of service billing and payment, which improves
audit opportunities [11].In this paper, Guerar, Meriem, et.al.
propose a model based on a public blockchain that permits fully
open and group-restricted invoice auctioning. Furthermore,
their strategy offers a reputation system based on the prior
deeds of entities as documented on the open blockchain,
enabling insurance providers to modify the cost of the
insurance contracts they offer [12]. Fig 1: Flowchart of Proposed Model

Distributed Ledger Invoice, a blockchain-based invoice The System is designed in such a way that the taxpayers can
discounting system, is introduced in this study, and a novel track their taxes and the government authorities monitoring
assessment method is suggested for assessing the present taxation nationwide can track the shopkeepers' real payments with
blockchain solutions for the invoice discounting scenario. the help of all the billing data produced on the blockchain.
Additionally, they go through two key challenges relating to
interoperability and accessibility of information. The Taxpayers and the authorities contribute directly to the
Interoperability is crucial for blockchain's acceptance in blockchain. A single block consists of registration annual returns
interbanking operations because it is still a developing payments show cause notices and orders.
technology and multiple blockchain solutions may be employed
in these activities. They also recommend a decoupling layer This data is then verified and used by/for law enforcement,
based on the Attribute-Based Access Control language to assessment, deemed and recovery, and prosecution.
standardize access control to reserved information across
several blockchains [13]. In this article, the block chain, which
forms the basis of Bitcoin, is examined. BlockChain is a very

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Volume 8, Issue 7, July – 2023 International Journal of Innovative Science and Research Technology
ISSN No:-2456-2165
There are different views for the data stored in the aspect of the overall implementation. The smart contract for the
blockchain: State Tax Authorities, Central Tax Authorities, and invoice generation system was created using Solidity, a
Other related authorities. programming language specifically designed for the Ethereum
blockchain. RemixIDE, a web-based integrated development
Views are basically used for giving access control to users environment (IDE) that enables developers to build, test, and
based on specific data items. deploy smart contracts, was used to develop the contract.

IV. METHODOLOGY For the implementation, the Ethereum Ropsten TestNet and
Ganache were used as the blockchains. Ropsten TestNet is a test
The project is built on a Web Application platform with network for Ethereum, which allows developers to test their
HTML, CSS, and JavaScript, the three main languages used to contracts without using real Ether. Ganache, on the other hand, is
build websites. Our website is programmed in JavaScript , a localhost simulation of Ethereum, which allows developers to
structured in HTML, and styled using CSS. Bills are created via test their contracts in a local environment.
the UI, and bill data such as owner name, bill id, and so on are
supplied as smart contract characteristics. A smart contract, The website provides a great user interface for the
which is a self-executing contract, directly incorporates the shopkeeper or retailer and can provide with a lot of options like
terms of the buyer-seller agreement into its lines of code. Smart inventory management and order management apart from just
contracts enable the implementation of reliable transactions and invoice generation. This allows the shopkeeper or retailer to have
agreements between dispersed, anonymous parties without the complete control over their inventory and orders, which can help
need for a centralized authority, a legal framework, or an them keep track of the stock and avoid stockouts. The website
external enforcement mechanism. We are placing the data on also provides a lot of functionalities like real-time updates,
the Ethereum Blockchain to assure its security. A peer-to-peer notifications, and reports, which can help the shopkeeper or
network for securely executing and verifying application code, retailer to make better decisions.
or "smart contracts," is created by Ethereum, a decentralized
blockchain platform. Without the aid of a reliable central Overall, the smart contract and the website together provide
authority, parties can conduct business with one another via a robust and secure invoice management system that can help
smart contracts. We deployed the contracts on test networks businesses to automate their invoicing process, improve their
before deploying them on the main network. We used Solidity efficiency, and reduce the cost. Because the data is immutable and
to construct the contract. We used Remix IDE to create and tamper-proof thanks to the usage of blockchain technology, the
deploy smart contracts, which are used to create a chain of system is more transparent and trustworthy. Additionally, the
transaction records and execute business logic in the blockchain user-friendly interface of the website makes it easy for users to
system. interact with the contract, making it accessible for businesses of
all sizes.
V. IMPLEMENTATION

In implementation, the website frontend is created using

Web3, a JavaScript library that allows users to interact with
Ethereum blockchain. The first step is to fetch the contract that
has been deployed on the blockchain. Once the contract is
fetched, an instance of it is created. After creating the instance,
the relevant information about the invoice, such as receipt
number, total amount, seller identification, and buyer
identification, is filled in as parameters. Once the parameters
are filled, the event that has been created is described, and its Fig 2: Generated Invoice
emit function is called. By storing the variables on the
blockchain with this emit function, they become unchangeable Pseudo Code for smart contract in Solidity for creating and
and tamper-proof. By enabling open access to all data stored on paying the bill:
the blockchain, the system becomes transparent and 1. Initialize an empty list of bills
2. Initialize a bill counter to 0
trustworthy.
3. Create a function called "create bill"
Additionally, the frontend can also include features such a. Input: payee's address, bill amount, and memo
as user authentication, real-time updates, and notifications, to b. Increment the bill counter
ensure smooth and efficient interactions with the blockchain c. Create a new bill with payee's address, bill amount, memo,
and "unpaid" status
contract. The frontend can also include a user-friendly interface
that allows users to easily navigate and interact with the d. Add the new bill to the list of bills
contract. Overall, the frontend serves as the bridge between the e. Emit an event "bill created" with bill ID, payee's address, bill
users and the blockchain contract, making it an important amount and memo

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Volume 8, Issue 7, July – 2023 International Journal of Innovative Science and Research Technology
ISSN No:-2456-2165
4. Create a function called "pay bill" [6]. Liu, Xidong. “Research and application of electronic invoice
a. Input: bill ID based on blockchain.” MATEC Web of Conferences. Vol.
b. Fetch bills from list of bills, using bill ID 232. EDP Sciences, 2018.
c. Check if the bill is unpaid [7].Nguyen, Van-Cam, et al. “Digitizing invoice and managing
i. If it is unpaid, check if the msg.value is equal to the bill vat payment using blockchain smart contract.” 2019 IEEE
amount International Conference on Blockchain and Cryptocurrency
1. If true, transfer the bill amount to the payee's address (ICBC). IEEE, 2019.
2. Mark the bill as paid [8]. Bulsara, Hemantkumar P., and Pratiksinh S. Vaghela.
3. Emit an event "bill paid" with bill ID “Blockchain technology for e-commerce industry.”
International Journal of Advanced Science and Technology
We also deployed the contracts on Ganache which is a 29.5 (2020): 3793-3798.
LocalHost simulation of Ethereum. [9]. Setyowati, Milla Sepliana, et al. “Blockchain technology
application for value-added tax systems.” Journal of Open
Innovation: Technology, Market, and Complexity 6.4
(2020): 156.
[10]. Chang, Yi-Wei, Keng-Pei Lin, and Chih-Ya Shen.
"Blockchain technology for e-marketplace." 2019 IEEE
International Conference on Pervasive Computing and
Fig 3: Contract deployed on Ganache Communications Workshops (PerCom Workshops). IEEE,
2019.
VI. CONCLUSION AND FUTURE SCOPE [11]. Neziri, Vehbi, Ramadan Dervishi, and Blerim Rexha.
"Blockchain invoicing for government services." (2021).
In this article, we covered blockchain technology and how [12]. Guerar, Meriem, et al. "Blockchain-based risk mitigation for
it may be used as a billing system in the retail industry. By invoice financing." Proceedings of the 23rd International
enhancing the transparency of products and overall information Database Applications & Engineering Symposium. 2019.
of bill generation the retail industry can be benefitted by [13]. Fabrizio, Nadia, et al. "Invoice discounting: a blockchain-
blockchain technology. based approach." Frontiers in Blockchain 2 (2019): 13.
[14]. Crosby, Michael, et al. "Blockchain technology: Beyond
This system will minimize present tax evasion, and the bitcoin." Applied Innovation 2.6-10 (2016): 71.
government will be able to track it. In addition to that, more [15]. Lycklama à Nijeholt, Hidde, Joris Oudejans, and Zekeriya
openness will be offered to customers so that they may learn Erkin. "DecReg: A framework for preventing double-
whether the tax they pay for a product is truly paid to the financing using blockchain technology." Proceedings of the
government. ACM Workshop on Blockchain, Cryptocurrencies and
Contracts. 2017.
VII. REFERENCES

[1]. Rosanna Cole, Mark Stevenson, James Aitken,

“Blockchain Technology: implications for operations and
supply chain management”, Supply Chain Management:
An International Journal, January 2019.
[2]. Simanta Shekhar Sarmah, “Understanding Blockchain
Technology”, by Scientific & Academic Publishing,
2019.
[3]. Arijit Chakrabarti, Ashesh Kumar Chaudhuri,
“Blockchain and its Scope in Retail”, International
Research Journal of Engineering and Technology
(IRJET), July 2017.
[4]. Nam Ho Kim, Sun Moo Kang, Choong Seon Hong,
“Mobile charger billing system using lightweight
Blockchain”, Institute of Electrical and Electronics
Engineers, IEEE , January 2017
[5]. Narayanam, Krishnasuri, et al. “Blockchain based e-
invoicing platform for global trade.” 2020 IEEE
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