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Supply Chain Glossary

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Procurement Card


Source: Procurement Glossary
Author: Paul Rogers
Institute: CIPS - UK

Courtesy of


 

A procurement card [PCard] is a credit card used by some organisations as an alternative acquisition method to raising a requisition and/or purchase order.  PCards were initially used to acquire low-value and low-risk categories, such as travel and entertainment, though because of their low transaction costs, they are increasingly being used for a wide variety of acquisitions.

Most PCard systems incorporate a variety of controls to prevent abuse, and a key control is to limit the number of staff who have access to a PCard.  Other controls can include a single purchase dollar limit, a monthly expenditure limit and a control on which merchants can be used.  Once expenditure has been incurred, the card provider will issue a statement to the buying organisation, which will allow reconciliation of expenditure and attribution to the appropriate budget and expenditure accounts.

The use of PCards can reduce the transactional workload for purchasing teams and focus activity upon establishing agreements for the key category spends, rather than managing individual transactions.  See also Acquittal.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 




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