GSA Federal Supply Service. Citibank Best Practices for Payments and Delinquency Management in Your Purchase Card Program

Transcription

1 GSA Federal Supply Service Citibank Best Practices for Payments and Delinquency Management in Your Purchase Card Program

2 Citibank Best Practices for Payments and Delinquency Management in Your Purchase Card Program Citibank Commercial Cards, Government Services Steven Lynch, August 31, 2005 The Seventh Annual GSA SmartPay Conference Copyright 2005 Citigroup Inc. All rights reserved. CITIBANK, CITIDIRECT and CITIGROUP and the Umbrella Device are trademarks and service marks of Citigroup Inc. or its affiliates and are used and registered throughout the world.

3 Goal & Objectives What you will learn today An understanding of delinquencies and collections Ways to locate and eliminate hidden balances Efficiency improvement and rebate enhancement Best practices for card control and timely payments 3

4 Agenda Payment Due Dates What happens with past-due accounts Who Can Help Role of your Client Account Services Manager Causes and Resolution of Delinquency Hidden balances / hidden delinquencies Best Practices for Improvement Improved efficiencies Card controls 4

5 Payment Due Dates When are payments due? Transaction date Transaction posting date Statement is issued Payment is due in 30 days 5

6 Payment Due Dates Transaction payment timeline March Mon Tues Wed Thurs Fri Sat Sun 1 2 Transaction occurs 3 4 Transaction posts to account CYCLE Statement is issued with transaction

7 Payment Due Dates Transaction payment timeline (continued) April Mon Tues Wed Thur Fri Sat Sun CYCLE Payment is due

8 Payment Due Dates What happens when an account is past due 1 30 days past due Statement will reflect a past due balance Amount is included in the new balance on the statement Prompt payment interest (PPI) Determined and calculated by the payment organization of your Agency Interest payment might reduce Agency funding Prompt Payment Act Section can help determine due date used for PPI An unpaid balance may impact available credit 8

9 Payment Due Dates What happens when an account is past due days Client Account Services Manager may contact the A/OPC 61+ days past due Billing account is suspended Rebate may be impacted Timely and early payment may increase rebates earned Late payments will decrease rebate potential Account reconciliation is time consuming and reduces productivity of the A/OPC and staff 9

10 Who Can Help Role of your Client Account Services Manager Each month the Client Account Services Manager receives and reviews a list of their clients with delinquent accounts At days past-due collection efforts begin Client Account Services Manager may contact the A/OPC Client Account Services Manager is available to assist the A/OPC with questions about account delinquencies 10

11 Causes and Resolution of Delinquency Causes of delinquency Payments sent without adequate identification Payment sent to incorrect address Partial payments Hierarchy changes Returned checks 11

12 Causes and Resolution of Delinquency Causes of delinquency (continued) Unclear agency policy and / or procedures Late or non-submission of reconciled / certified statements to accounts payable office Employee misuse and unreported fraud Inadequate management of disputes 12

13 Causes and Resolution of Delinquency Hidden balances / hidden delinquency Statement not paid in full Amount of credits in new billing period that exceed the balance due Old balance remains unpaid Common causes Making payments for transactions, not the full amount billed Disputes Deducting credits twice 13

14 Causes and Resolution of Delinquency Hidden balances / hidden delinquency (continued) Effect on account Expiration of dispute rights Accounting discrepancies Negative effect on productivity rebate Resolution could be difficult 14

15 Causes and Resolution of Delinquency Hidden balances / delinquency resolution Identify when short payment occurred Tools available to use Citigroup reports CD400 Invoice CD401 Detailed Account Cycle Report» Cardholder detail TBR reports TBR200 Unit Cycle Statistics» High level Agency s copies of Corporate Account Statement Work with your Client Account Services Manager They have the experience and expertise 15

16 Causes and Resolution of Delinquency Report tools for assistance 16

17 Causes and Resolution of Delinquency Reconciliation spreadsheet Statement Date 21-Jan Feb Mar-04 Previous Balance Purchases Credits Sub-Total Cash /Checks Cash Fee Sub-Total Miscellaneous Total amount to be paid Payment Received Statement Balance Due Past Due Balance 17

18 Causes and Resolution of Delinquency Reconciliation spreadsheet (continued) Statement Date 18-Jan Feb Mar-05 Previous Balance $127, $ 287, $ 163, Purchases $ 160, $ 166, $ 203, Credits $ (343.85) $ (5,196.25) $ (3,687.53) Sub-Total $287, $ 449, $ 199, Cash /Checks $ - $ - $ - Cash Fee $ - $ - $ - Sub-Total $ 287, $ 449, $ 199, Miscellaneous $ - Total amount to be paid $ 287, $ 449, $ 199, Payment Received $ - $ (285,989.55) $ (161,667.96) Statement Balance Due $ 287, $ 163, $ 196, Past Due Balance $127, $1, $1,

19 Causes and Resolution of Delinquency Reconciliation spreadsheet (continued) Statement Date 18-Jan Feb Mar-05 Previous Balance $127, $ 287, $ 163, Purchases $ 160, $ 166, $ 203, Credits $ (343.85) $ (5,196.25) $ (3,687.53) Sub-Total $287, $ 449, $ 199, Cash /Checks $ - $ - $ - Cash Fee $ - $ - $ - Sub-Total $ 287, $ 449, $ 199, Miscellaneous $ - Total amount to be paid $ 287, $ 449, $ 199, Payment Received $ - $ (285,989.55) $ (161,667.96) Statement Balance Due $ 287, $ 163, $ 196, Past Due Balance $127, $1, $1,

20 Best Practices for Improvement How to prevent delinquencies Ensure payment is sent to arrive within 30 days Pay and confirm / pay and chase Ensure cardholders reconcile and certify charges in a timely manner 20

21 Best Practices for Improvement To prevent delinquencies Maximize card control MCC restrictions Transaction size limits Cardholder credit limits Limit convenience checks Report utilization Monitor payments and account use Action plan Determine accounts to review Adjustments to make Review agency policy 21

22 Best Practices for Improvement For timely payments Use ACH for quickest payment application A variety of choices are available For various needs of your agency, ACH can handle! Usually received by next day Payment by check ONLY as a last resort Put the account number on the check Be sure your accounts payable office knows to include the account number Send to the correct address Allow time for mail delivery 22

23 Summary Delinquency management is everyone s responsibility Understand causes and effects Implement best practices Increase potential for productivity rebate Improved program integrity 23

24 Citibank Best Practices for Payments and Delinquency Management in Your Purchase Card Program Questions? 24

25 Reminders Thank you for attending this session! Visit the Citigroup Welcome Center Hynes Ballroom 306, on the third floor National Industries for the Blind will have a display of products Visit the Citigroup Technical Demonstration Center Hynes Ballroom 305, on the third floor Citibank hands-on training sessions Hynes Ballroom B, on the third floor Please take a moment to complete your GSA survey for this session 25

26 Copyright 2005 Citigroup Inc. All rights reserved. CITIBANK, CITIDIRECT and CITIGROUP and the Umbrella Device are trademarks and service marks of Citigroup Inc. or its affiliates and are used and registered throughout the world.