Proper Use of a Government Issued Travel Charge Card

» Posted by on Oct 6, 2014 in Industry Postings, Payment Methods, White Papers | 0 comments

In today’s world of instability and financial woes, people are struggling to survive.  Government employees are included in those people who are struggling.  People are relying more and more on credit cards to get by in this tough economic time.  That is why this is the perfect time to review the proper use of a government issued travel charge card.

The number one thing for cardholders to remember is that the government issued travel charge card is to be used for “official government travel only”.  Even though the charge card is in the cardholders’ name and goes against their personal credit history, it is still only to be used for government travel.  It is hard for some individuals to understand that since the financial responsibility of the card is theirs, why they can’t use it whenever they choose.

When a cardholder applies for a government charge card, they are given the bank’s cardholder agreement.  This agreement lists the rules and regulations of the issuing bank.  This account agreement clearly states that the card is to be used for official travel only and is not to be used for personal, family, or household purposes.

One way our agency has helped to ensure cardholders do not use their charge cards for personal use is by blocking two-thirds of the Merchant Category Codes (MCC).  An MCC is assigned to a vendor when they start accepting charge cards for payment.  By blocking MCC’s that are not government travel related, (adult entertainment, movie theaters, etc.), individuals are restricted to where they can use their charge cards.  If the cardholder traveling on official business has their card declined because of a blocked MCC and the expense is allowed, the cardholder can contact our office.  We can temporarily unblock the MCC to allow the transaction to be completed.

On a monthly basis, management reviews reports provided by the issuing bank which details the use of the individually billed travel (IBT) cards.  If misuse and abuse is found, the cardholder would be subjected to disciplinary action.  It is important to remember if there are transactions that are not valid, they need to be disputed timely.  Any late fees charged by the vendor on undisputed charges are the responsibility of the cardholder.  If the delinquency on the account is large enough, the agency may choose to establish a salary offset until the balance is paid in full.

A second thing cardholders must remember is to reconcile their statements.  As a government cardholder, it is his/her responsibility to reconcile the account.  When an employee travels on official government business, their transportation and lodging costs along with any booking fees will be charged to their charge card.  Other miscellaneous items such as meals, parking, tolls, excessive baggage, and rental cars may also be charged to the account.  Once the cardholder returns from travel, they need to voucher within five days.

Our agency has implemented the mandatory use of split disbursement.  This means when a traveler is creating an authorization/voucher, they can automatically allocate the amount of reimbursement needed to cover all expenses that were charged on the travel card and the money will be sent to the charge card company.  When creating the voucher, the cardholder should review expenses posted on their card account and voucher accordingly.  For most expenses, the method of reimbursement can be changed from being paid directly to the traveler to his/her charge card via split disbursement.  The electronic travel system will also allow the cardholder to send additional money from what they personally would be reimbursed to cover those items where the method of reimbursement could not be changed, (for example, meals).

Under the GSA Smart Pay Master Contract, awarded banks must provide an Electronic Access System, (EAS) which allows cardholders to log online to verify transactions that are placed on their charge card.  The EAS was added as a requirement to help the “go green” initiative set forth by the President.  By utilizing the EAS, cardholders can more accurately voucher because they can see all transactions that have posted to their account, even those transactions posted between statements.  It is important for cardholders to learn how to use the EAS system to keep their accounts reconciled because unpaid past due balances will affect their personal credit score.

Another item to remember is that the charge card is in the name of a specific traveler and can only be used by that specific cardholder.  If a group of individuals are traveling on business together, one charge card should not be used to reserve multiple rooms.  Each individual will need to have a unique charge card number on the reservation.

These are the main reminders for government cardholders.  They should not fall into the trap and state that they did not know the rules of the proper use of the charge card.  It is the cardholders’ responsibility to know the rules before using the charge card.  The account agreement is given to the cardholder when they first apply for the card and each agency must have travel policies based on federal regulations that must be followed.  Cardholders just remember if in doubt, call the agency helpdesk for assistance.

By: Linda Ruppel, CGTP

The contents of this message are mine personally and do not reflect any position of the Government or my agency.

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