[PDF] - CFC U.S. Bank One Card July 29, 2010 How to Submit Your Question PDF Document

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CFC U.S. Bank One Card

July 29, 2010

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How to Submit Your Question

Step 2: Click on the Send button. Step 1: Type in your question here.

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CFC U.S. Bank One Card

July 29, 2010

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Polling Question

Of the following five comic strips, which one

has been continuously published for the longest time? a) Hazel b) Blondie c) Dennis the Menace d) Beetle Bailey e) The Lockhorns

CFC U.S. Bank One Card

July 29, 2010

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Background

Original card programs began in 2001
Consolidated products into One Card program

in August 2006

Program currently has 158 participants and

generated about $16 million in aggregated spending last year

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U.S. Bank – A Strategic Resource

$281 billion in assets
6th-largest commercial bank in the United States
Unparalleled industry experience
Solutions for the entire payment continuum
Program design/implementation expertise
Unsurpassed resource commitments
World-class, U.S.-based customer service

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A strong commitment to the payments business
More industry experience than all other banks

combined

Ubiquitous merchant acceptance
Competitive commercial card advantages for

CFC members

Long-term relationship with a strong and stable

commercial bank

U.S. Bank Strategic Benefits

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Does My Co-op Need a Commercial Card?

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Commercial Card Opportunity

2008 Commercial Consumption Expenditures (CCE) 100% = $19.7T

Commercial Cards 3.1% Cash, Checks and ACH 96.9% 12

Purchasing Landscape

Annual purchasing card spending in

North America grew from $110 billion in 2005 to $137 billion in 2007

Purchasing card spending in North America is

expected to increase to $218 billion by 2012— that’s about 12-percent growth each year

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Purchasing Landscape

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Bottom-Line Results

Average net savings of $69+ per transaction
Average procurement cycle time reduction
f 6.3 days
Average reduction in supplier base of 31%
38% increase in ability to negotiate preferred

pricing

Happier and more productive employees

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Real-World Successes*

Procure-to-pay and commercial card programs build the bottom line.

– One electric utility expanded its card program from emergency purchases only to all its routine purchasing, reducing manual AP check payments by more than 65%. – A leading provider of technology and business solutions plans to move more than $8 million of company spend from paper checks to its commercial card program. – A construction company saved more than $100,000 and grew its commercial card program from $1 million to $6 million by eliminating local “house” charge accounts.

*2008 Visa Global Procure-to-Pay and Commercial Best Practices Study, Deloitte Consulting

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The Program

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What is a One Card?

Meets the needs of every co-op’s spending activity—combining the benefits of corporate and purchasing cards in a single card program

Purchasing Card

Designed to pay for small dollar, frequently purchased items Office equipment and supplies Maintenance, repair and

perations

Budgetary spend Computer hardware, software and peripherals Printing and duplicating services Professional, temporary and janitorial services Designed to pay for travel and entertainment (T&E) expenses

Corporate Travel Card

Airfare Hotel Car rental Meals Entertainment Meeting and event planning Employee relocation Designed to manage both T&E and procurement expenses

One Card

Office equipment and supplies T&E Maintenance, repair and

perations

Budgetary spend Meeting and event planning Miscellaneous services Employee relocation

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Program Benefits

No annual fees or interest
No credit check on cardholders
No individual liability
Flexible online reporting and administration

capabilities

Exciting rebate opportunity

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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

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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

r for a specific type of purchase
Ghost Accounts

– A virtual, card-free purchasing account tied to a single department, supplier or spend category

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One Card for Purchasing

Reduces volume of purchase orders, invoices

and check payments

Improves purchasing management and provides

reporting for IRS and state regulators

Enables monitoring of corporate policy

compliance

Improves employee spending controls
Reduces supplier base by an average of 48%
Facilitates vendor negotiations

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One Card for T&E

Customized authorization controls
Online account access
Cash advance option
Ability to interface with your accounting

software

Comprehensive travel benefits

– Worldwide automatic travel accident insurance: $250,000 – Excess lost/damaged luggage coverage: $1,250

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Typical Co-op Cardholders

Human resources
Plant and maintenance employees
Technical and office staff
General administration
Purchasing department
Advertising/marketing staff
Sales force

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Typical Co-op Expenditures

Oil and fuel
Computer and software purchases
Utilities payments
Office supplies
Continuing education expenses
Online purchases
Airfare and hotel expenses

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Polling Question

In which decade did using commercial credit

cards for fleet management take off? a) 1950’s b) 1960’s c) 1970’s d) 1980s e) 1990’s

One Card Rebate Opportunity

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Rebate Overview

Participating cooperatives have the
pportunity to qualify for an annual

cash rebate

The rebate period runs annually from

September through August

Program attained a rebate for the 2009-2010

rebate year with $16 million in total spend and an average transaction size of $125.

On track to receive a rebate this year with

$15.9 million total spend and $144 average transaction size (as of 6/10).

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How the Rebate Works

Participating cooperatives must collectively

generate at least $5 million in annual charge volume and have an average transaction size

f at least $120
The higher the collective charge volume, the

higher the percentage of rebate

Once the collective program rebate is attained,

cooperatives can earn a portion of that rebate if they meet the individual eligibility requirement

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Individual Rebate Eligibility

The cooperative’s annual spend must be at

least $175,000

If the cooperative has an average transaction

size of least $120, the rebate is even higher

Making One Card Work for You

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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 – Reports to better understand spending patterns, vendor usage and policy compliance – Automated posting capabilities to integrate card data with accounting and general ledger entries

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AutoPay

Amount due is automatically drawn from

specified account

Cycling date is the 16th of every month unless
n a weekend or holiday
Cooperative chooses a draft date that is within

14 days of the 16th

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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 Visa and MasterCard merchants

worldwide

Enhanced fleet data capture─provided by most

major oil companies

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Merchant Category Codes

Provide a method of understanding and

managing company spending by category code

Use merchant category codes (MCCs) to

prevent employee misuse

Open and close MCC blocks for flexibility

as necessary to your organization and supplier base

Automate annual IRS Form 1099-MISC reporting

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Flexible Spending Management

Authorization parameters

– Monthly spending limit – Daily spending limit – Single-purchase limit (SPL)

Supplier category restrictions

– Travel, casinos, jewelry, liquor, etc.

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Automated Accounting Methods

Default account code assigned to each card

– Cost center, budget code, company code, etc.

General Ledger object codes assigned by type
f purchase

– Office supplies, computer equipment, hotels, hardware stores, etc.

Accounting codes can be changed/edited as

needed

Transaction data can be exported for integration

with accounting software

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Addressing Cooperative Concerns

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Cooperative Concern 1

Spend Out of Policy

– (also known as “Maverick Spend”) – A commercial card is used in a way that does not conform to the spending policies of the

rganization

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Do commercial cards increase

ut-of-policy spending?
Out-of-policy spending for purchasing cards accounts for
nly 0.075 percent of annual purchasing card spend,

which is equivalent to $7.50 for every $10,000 spent 1

Out-of-policy spending for corporate cards accounts for

0.163 percent of annual travel and entertainment spend, or $16.30 for every $10,000 spent 2

Transaction and monthly limits can significantly reduce

the number of purchases made out of policy

1 RPMG Research Group, 2005 Purchasing Card Benchmark Survey Report 2 RPMG Research Group, 2004 Corporate Travel Card Benchmark Survey Results

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Cooperative Concern 2

Card Misuse

– An employee charges a personal expense through a commercial card and misrepresents it as a business expense

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Will employees misuse commercial cards?

Purchasing card misuse accounts for 0.034 percent of

purchasing card spend, which is the equivalent of $3.40 for every $10,000 of purchasing card spend1

Corporate card misuse currently accounts for less than

0.01 percent of travel and entertainment spend, or less than $1.00 for every $10,000 spent2

With the Visa Liability Waiver Program, companies with

Visa commercial card programs are covered up to $100,000 per cardholder in the event of employee card misuse

1 RPMG Research Group, 2005 Purchasing Card Benchmark Survey Report 2 RPMG Research Group, 2004 Corporate Travel Card Benchmark Survey Results

Dedicated Program Support

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U.S. Bank Support

Greg Wenisch, Account Manager – Custom implementation – Ongoing strategic consultation – Training on Web-based access tools – Problem resolution – A complete partnership approach to your business success

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CFC Program Support

Manages relationship with U.S. Bank
Provides day-to-day member contact
Establishes new cooperative accounts
Answers general member questions and

concerns

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