Policy paper

Payment cards - Pan-Government policy

Policy for central Government departments and their Arm’s Length Bodies (ALBs) governing the use of payment cards.

• From: Cabinet Office
• Published: 14 December 2017
• Last updated: 6 April 2020 — See all updates

This was published under the 2016 to 2019 May Conservative government

Documents

Payment cards: Pan-Government policy

PDF, 447 KB, 7 pages

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Details

Procurement Cards are used by government as a method of prompt payment, not as a credit card, and can be used to pay for all goods and services, irrespective of value, subject to the restrictions set out at paragraph 4.2 below. They are also the recommended method of purchasing and paying for goods or services under twenty-thousand pounds (£20,000) with an overall monthly spending limit of one hundred-thousand pounds (£100,000). Monthly spend on Procurement Cards in excess of £100,000 should be permissible to meet business needs.

There are three types of Procurement Card: physical, lodge and virtual.

• Physical cards refers to the plastic card issued to a specific person within a department.
• Lodge cards are embedded into a supplier’s system (e.g. a travel management company for booking travel without having to provide card details for each booking).
• Virtual cards are a randomly-generated card number associated with a physical Procurement Card which can be used once or multiple times, depending on your preferences.

For the avoidance of doubt, this policy applies to all three types. All card payments are categorised into Merchant Category Groups (MCG) with further breakdown into Merchant Category Codes (MCC). These codes identify the merchant by their business line. They provide a way to identify and categorise reportable transactions and can be used for blocking purchases for specific companies or categories of businesses (e.g. gambling, gaming or pay-day loans).

There are many benefits to using Procurement Cards, such as reducing procurement process times, operational efficiencies and supporting the Government’s prompt payment initiative for Small and Medium Enterprises, supporting and maintaining cash flow to suppliers. Increasing use of Procurement Cards can improve departments’ efficiency and accelerate payment to their suppliers while still ensuring robust controls.

The official Government Procurement Card programme is offered under the Crown Commercial Service’s (CCS) Payment Solutions Purchasing Card Solution framework. An additional benefit of using the Purchasing Card via this framework is a rebate based on a percentage of all transaction values retrospectively paid back to users on an annual basis.

Procurement Cards are to complement local purchasing and payment systems not to replace them. The cards will be used as defined by the departmental procurement acquisition model agreed by procurement and financial colleagues.

Published 14 December 2017
Last updated 6 April 2020 + show all updates

1. 6 April 2020

   Update to Pan-Government Procurement Card Policy in line with new Procurement Policy Note 03/20

2. 14 December 2017

   First published.