Travel and Entertainment cards have been used by MNCs for many years and they continue to add significant value to disbursement processes and working capital management. There can be challenges regarding program ownership, provider preferences, rebate management and global acceptance.
But they have a lot offer, and not just T&E. Today’s corporate P-Card programs go well beyond T&E to create significant savings and process improvements across an organization, e.g., in reducing the need for petty cash used for incidental items at remote business sites or controlling levels and types of spending. For larger corporations with significant spend, the volume generated from card purchases is rewarded in the form of substantial dollar rebates from your card provider.
Not directly owned by treasury.
Although the management of a global T&E card program is not typically owned by treasury, treasurers must be engaged in the specific details of the program to ensure appropriate bank pricing and wallet allocation. When ranking the importance of program objectives, reducing transaction costs, maximizing rebates and mitigating fraud are top of the list. In a spring NeuGroup Global Cash and Banking Group pre-meeting survey, most respondents have a mix of regional and country-specific card solutions. Only 25 percent of respondents have one global provider.
Bank-sponsored programs are favorable.
Members agreed that non-bank card providers like AMEX are typically good at meeting the majority of corporate objectives for a global card program, but from a treasury perspective, it was difficult to watch this level of transactional business move away from a bank.
Rebates.
The allocation of rebates is managed differently by members, but the majority allocates card program rebates back to the group who manages the program, in most cases, procurement. Some members allocate rebates back to the SSC and then further onto the business group based on card usage.
Although the management of a global T&E card is most often managed outside of treasury, it is still very important for members to stay engaged and involved in the review of program details to ensure proper pricing and allocation of ancillary treasury services to the extent possible.