This document discusses JD's implementation of an e-invoice system using blockchain technology. JD is a large Chinese e-commerce and retail company that was facing issues with their paper invoice system, including high costs, inefficiencies, and counterfeiting. They partnered with CPIC to develop an electronic invoice system on JD Chain, their proprietary blockchain platform. The new system automates invoice generation, allows for customized services, and produces unique, immutable invoices to address the previous issues. The results have included lower costs, higher efficiency, and a move towards more paperless transactions. Remaining challenges include some unsolved problems and further integrating tax technology.

1. CASE PRESENTATION
JD: E-INVOICE WITH
BLOCKCHAIN

2. GROUP 3 ATOM
Name Batch ID
Inam Ahmad 63D 37
Md. Rafiuzzaman Rafi 63D 51
Tazneen Shaon 63D 45

3. CASE OVERVIEW
• JINGDONG (JD), A LEADING TECHNOLOGY AND INNOVATION-DRIVEN E-
COMMERCE COMPANY AND RETAIL INFRASTRUCTURE SERVICE PROVIDER IN
CHINA
• GREAT SURGE IN DEMAND FOR PAPER VAT SPECIAL INVOICE
• NOT ONLY THE PAYMENT RECEIPT BUT ALSO PROOF FOR THE BUYER’S VAT
DEDUCTIONS
• VAT INVOICE ARE IMPORTANT FOR ENTERPRISE PROCUREMENT

4. JINGDONG (JD)
• ENTERED THE E-COMMERCE MARKET IN 2004,
• RANKED 261ST IN THE FORTUNE 500, WITH US$39.155 BILLION OF REVENUE IN
2017.
• MULTIPLE BUSINESS ENTITIES WITH RETAIL, DIGITAL TECHNOLOGY, AND
LOGISTICS AS CORE
• CHINA’S FIRST LARGE-SCALE INTEGRATED E-COMMERCE PLATFORM LISTED IN
NASDAQ

5. JD ENTERPRISE PROCUREMENT: B2B
• FORMALLY LAUNCHED ON MAY 18, 2014
• SEVEN MILLION+ ACTIVE BUSINESS USERS
• RANKED FIRST IN CHINA’S SELF-OPERATED BUSINESSES IN THE E-COMMERCE
MARKET,
• 120 PER CENT ANNUAL SALES GROWTH
• ONE-STOP, CUSTOMIZED, AND INTELLIGENT PROCUREMENT SOLUTIONS AND
SERVICES FOR ALL ORGANIZATIONAL PROCUREMENT NEEDS
• MORE TRANSPARENCY, HIGH EFFICIENCY, AND LOW COST.

6. ISSUES AND CHALLENGES
• THE RECONCILIATION OF ACCOUNTS THAT DID NOT FORM A CLOSED LOOP,
• THE IMPROVEMENT OF THE CUSTOMER’S EXPERIENCE
• THE HIGH COST OF INVOICE RISK CONTROL
• THE LOW EFFICIENCY OF INVOICE MANAGEMENT.
• LAUNCHING AND PROMOTING AN ELECTRONIC VERSION OF THE VAT SPECIAL
INVOICE NATIONALLY
• APPLY JD CHAIN TO ELECTRONIZE THE VAT SPECIAL INVOICE AND INTEGRATE
THE SYSTEMS OF PROCUREMENT, FINANCE, AND REIMBURSEMENT

7. ISSUES WITH PAPER INVOICE
• HIGH LABOR COST AND LOW MANAGEMENT EFFICIENCY
• MANUAL INPUT
• POOR CUSTOMER EXPERIENCE
• COUNTERFEITS, NON-COMPLIANT INVOICES AND THE REPEATED USE FOR
REIMBURSEMENTS
• SUB STANDARD INVOICE HAD TO BE RETURNED AND REISSUED
• CONSTRAINED THE RAPID DEVELOPMENT OF E-COMMERCE ENTERPRISE
PROCUREMENT

8. E-COMMERCE ENTERPRISE PROCUREMENT IN
CHINA
• BUSINESS AND COMPANIES (B) AND CONSUMERS (C). DIGITALIZATION, BIG DATA,
CLOUD COMPUTING, THE INTERNET OF THINGS (IOT), AND ARTIFICIAL
INTELLIGENCE (AI)
• DIFFERING FROM TRADITIONAL ENTERPRISE PROCUREMENT AND B2B E-
COMMERCE
• ONE-STOP ONLINE MANAGEMENT FOR THE WHOLE PROCESS OF ENTERPRISE
PROCUREMENT USING DIGITAL TECHNOLOGY
• PROCUREMENT-DRIVEN B2B WITH THE WHOLE PROCESS ONLINE
• VAT SPECIAL INVOICE ARE REQUIRED MAKE FINANCIAL ACCOUNTING, VERIFY
ACCOUNTS, AND DEDUCT TAX.

9. JD BLOCKCHAIN OPEN PLATFORM (JD CHAIN)

10. UNIQUE FEATURES OF JD CHAIN
• HIGH PERFORMANCE- SUPPORTS MASSIVE ACCOUNTS, TRANSACTION STORAGE,
AND THE HIGH PERFORMANCE OF CRYPTOGRAPHIC ALGORITHMS.
• CUSTOMIZATION-FLEXIBLY COMBINE AND USE SYSTEM COMPONENTS BASED ON
UNIQUE NEEDS.
• STRONG SECURITY AND PRIVACY PROTECTION-A MULTI-FACETED AND
MULTICHANNEL SECURITY SYSTEM THAT MET NATIONAL SECURITY STANDARDS.
• EFFECTIVE DATA GOVERNANCE- USE DATA INDEPENDENTLY FROM THE
BLOCKCHAIN PLATFORM
• MULTI-CHAIN COORDINATION-INTEROPERABILITY BETWEEN DIFFERENT
ORGANIZATIONS,
• LOW COST AND EASE OF MAINTENANCE- SIMPLIFIED ACCESS AND
MAINTENANCE, AND PROMPT UPLOAD TO THE BLOCKCHAIN.

11. BLOCKCHAIN
AN INTRODUCTION
1. BLOCKCHAIN IS A TYPE OF SHARED DATABASE
STORE DATA IN BLOCKS
2. BLOCKS ARE LINKED TOGETHER VIA
CRYPTOGRAPHY
3. PARTICIPANTS STORES AND VALIDATES
CHANGES HAPPENING IN THE NETWORK

14. BENEFITS
CONSISTENT
DEMOCRATIC
SECURE AND PRIVATE
PERMANENT AND TAMPER RESISTANT

15. IMPLEMENTATION
COLLABORATION WITH CPIC

16. CPIC’S RELATIONSHIP WITH JD
Started early 2018 E-procurement reduced
75% of auditing processes
Collaboration with
EleCloud end of 2017

17. FEATURES
• AUTOMATED BILL
GENERATION
• CUSTOMIZED SERVICES
• UNIQUE, IMMUTABLE,
TRACEABLE INVOICES

18. RESULTS
Lower processing time Lower costs
Lower risks of
counterfeiting
Enhanced efficiency
Move to more
paperless transactions

19. FUTURE CHALLENGES
WHAT CAN JD EXPECT TO FACE MOVING FORWARD?

20. REMAINING ISSUES
Some problems could not be solved
Repeated use of invoice for reimbursement,
verification process
Immutability of blockchain
Possibility of loss of secret keys

21. AREAS OF
RESEARCH
• INTERNET + TAX
TECHNOLOGY
• CREATING A NEW,
INTEGRATED TAX
ECOSYSTEM

22. THANK YOU