CFC s Financial Webinar Series The CFC U.S. Bank One Card: A new way to manage funds. For Technical Support. How to Submit Your Question

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1 CFC s The CFC U.S. Bank One Card: A new way to manage funds For Technical Support If you re listening over the phone, please press *0. If you re listening through your computer speakers, nreca_assist@commpartners.com. 2 How to Submit Your Question Step 1: Type in your question here. Step 2: Click on the Send button.

2 To Download the Program Files 1. Click here in the Links box to open the presentation slides or handout. 2. Click on an icon to print or save the file. 4 CFC s Risk Management: A Panel Discussion

3 When was the concept of individuals having a credit card first discussed in public? Polling Question Today s takeaway: Everything evolves!

4 Speakers U.S. Bank Greg Wenisch CFC Lauren Harris East Central Energy Deb Eck Greg Wenisch U.S. Bank Relationship Manager Background Original card programs began in 2001 Consolidated products into One Card program in August 2006 Program currently has 197 participants Generated $24.3 million in aggregated spending last year

5 U.S. Bank Strategic Benefits A strong commitment to the payments business Competitive commercial card advantages for CFC members Long-term relationship with a strong and stable commercial bank World-class, U.S.-based customer service Program design/implementation expertise What Is the CFC One Card? Single card program that combines the benefit of a corporate and purchasing card. Corporate Travel Card Designed to pay for travel and entertainment (T&E) expenses Purchasing Card + Designed to pay for = frequently purchased items One Card Program Benefits No annual fees or interest No credit check on cardholders No individual liability Flexible online reporting and administration capabilities Exciting rebate opportunity

6 Program Benefits Simplify and streamline operations Save time, money and resources Stay in control and in compliance Tailor the card program to your specific needs Provide a convenient payment tool to employees Make better-informed business decisions Types of One Card Accounts Individual Cardholder Accounts A card assigned to an individual employee that has the employee s name on the card Department Cardholder Accounts A card that is commonly used by a department or for a specific type of purchase Ghost Accounts A virtual, card-free purchasing account tied to a single department, supplier or spend category One Card for Purchasing Reduces volume of purchase orders, invoices and check payments Interfaces with your accounting software Enables monitoring of corporate policy compliance Improves employee spending controls Facilitates vendor negotiations

7 One Card for T&E Customized authorization controls Online account access Cash advance option Comprehensive travel benefits Worldwide automatic travel accident insurance: $250,000 Excess lost/damaged luggage coverage: $1,250 Auto collision coverage Typical Co-op Cardholders Human resources Plant and maintenance employees Technical and office staff General administration Purchasing department Advertising/marketing staff Sales force Typical Co-op Expenditures Oil and fuel Computer and software purchases Utilities payments Office supplies Continuing education expenses Online purchases Airfare and hotel expenses

8 One Card Top Co-op Spend Categories Annual Volume Type of Spend ATS # of Transactions $4,062, HOTELS $ ,737 $3,110, WHOLESALE TRADE $ ,175 $2,963, COMPUTER/ELECTRONIC $ ,904 $2,866, EATING/RESTAURANTS $ ,060 $2,638, BUSINESS EXPENSE $ ,237 $2,512, FUEL PURCHASES $ ,051 $1,691, WHOLESALE ELECTRIC PARTS $ ,825 $1,665, AIRLINE $ ,062 $1,154, DISCOUNT STORES/GROCERY STORES $ ,684 $818, VEHICLE EXPENSE $ ,395 $751, BUSINESS SERVICES $ ,776 $583, OFFICE SERVICES $ ,509 Flexible Spending Management Authorization parameters Monthly spending limit Daily spending limit Single-purchase limit (SPL) Effective dating Supplier category restrictions Travel, casinos, jewelry, liquor, etc. Merchant Category Codes(MCC s) Provide a method of understanding and managing company spending by category code Use MCC s to prevent employee misuse Open and close MCC blocks for flexibility as necessary to your organization and supplier base

9 Monthly Managing Statements Sent to the designated Program Administrator Itemize all transactions detailed by cardholder Date City and State Supplier Name Amount Access Online Free Web-based access tool provides: Convenient, secure online access to data anytime, anywhere Account setup and maintenance Ability to adjust cardholder spending limits Access to view cardholder statements online

10 AutoPay Amount due is automatically drawn from specified account Cycling date is the 16th of every month unless on a weekend or holiday Cooperative chooses a draft date that is within 14 days of the 16th Fleet Capabilities Cards issued at a driver or vehicle level Enhanced spending controls Ability to limit spending to fuel and/or maintenance only Prompts for driver ID and odometer reading Velocity controls and hard limits Accepted by all Visa and MasterCard merchants Enhanced fleet data capture provided by most major oil companies Program Optimization Discuss objectives and challenges Collect required data and conduct analysis Present findings and recommendations Set goals and create an action plan Execute and measure improvement Re-evaluate periodically to identify new opportunities Introductory Presentation Research File/Review Results Presentation Commitment / Execution

11 Payment Analytics Monitor commercial card compliance with payment policies Get notifications for: Holiday/weekend transactions Unauthorized merchant category transactions Large increases in spend Accounts reaching their limits Cooperative Concern 1 Do commercial cards increase out-ofpolicy spending? Tools for Controlling Out-of-Policy Spend Access online for monitoring Set limits (monthly, per transactions, daily) Review payment analytics Manage merchant category codes

12 Do Commercial Cards Increase Out-of-Policy Spending? Purchase card policy violations account for 0.006% of purchasing card spending the equivalent of $60 of policy violations for every $1 million of purchasing card spending. 1 Cumulatively, noncompliant transactions account for about 0.021% of travel card spending (or $210 out of every $1 million of travel card spending), a figure that has fallen from 0.035% in 2006 and 0.163% in RPMG Research Group, 2010 Purchasing Card Benchmark Survey Report 2 RPMG Research Group, 2009 Corporate Travel Card Benchmark Survey Report Cooperative Concern 2 Will the One Card lead to employee misuse or fraud? Tools for Handling Fraud and Employee Misuse Set monthly, single purchase and daily limits Block Merchant Category Codes Create department cards and issue them only when employees use them Block international purchases

13 Statistics on Card Misuse Purchasing card misuse accounts for.014% of purchasing card spending, which is the equivalent of $1.40 of misuse for every $10,000 of purchasing card spend..008% for fraud and misrepresentation.006% for policy violations Visa Liability Waiver Program covers your cooperative up to $100,000 per cardholder in the event of employee card misuse. Lauren Harris CFC Program Support Analyst Rebate Overview Participating cooperatives have the opportunity to qualify for an annual cash rebate The rebate period runs annually from September through August

14 How the Rebate Works Participating cooperatives must collectively generate the following requirements: $10 million in annual charge volume Average transaction size of at least $100 Individual Rebate Eligibility Once the collectiveprogram rebate is attained, there are two ways members can earn a portion of that rebate: Annual spending of at least $5,000 Annual average transaction size of at least $ Rebate Rebate year ended August 31, Portfolio Total Spend: $28.9 million Average Transaction Size: $160 Total combined payout to participants: $226,331

15 Deb Eck East Central Energy Finance Supervisor East Central Energy Card Usage Participating since November employees with cards All departments use the One Card Streamlined monthly procurement process

16 One Card Manages Purchasing Receive materials faster Save time and money Send faster payments to vendors Get higher rebates Providing Flexibility Saves time with online account setup and maintenance Eliminates employees having to use their personal funds for business purchases Prevents potential late fees and lost invoices with AutoPay Now let s turn it over to our audience!

17 How to Submit Your Question Step 1: Type in your question here. Step 2: Click on the Send button. Please take a minute to complete the NRECA survey. Your responses will help us improve the broadcast quality of these Web conferences! Events & Training Tab Look for all of our program recordings right here!

18 Mark Your Calendar for Our Next Event: November 14, 1 p.m. Eastern Time Declining Growth: A discussion of how co-ops ops cope with this serious issue Contact Information Lauren Harris Lauren.harris@nrucfc.coop This program The CFC U.S. Bank One Card: A new way to manage funds is a copyrighted presentation of CFC. No portion of this program may be reproduced, used or distributed without CFC s written consent.

19 To Download the Program Files and Evaluation 1. Click here in the Links box to open the presentation slides or handout. 2. Click on an icon to print or save the file. 5