Employee Credit Cards: What’s Wise?
(Originally published as an article within ECCU’s former e-publication, Ministry Banking Today.)
Credit cards—they’re designed to offer convenience but can be more trouble than they’re worth if misused. Ministries we interviewed about employee credit card usage had two primary concerns: Appropriate use of the cards and monthly liability.
“A carefully crafted credit card policy is the key to controlling these issues,” says Larry Knight, pastor of church operations at Medford First Church of the Nazarene in Medford, Oregon. “Our church’s credit card policy is designed to make ministry easier, yet still emphasize accountability for how funds are spent.” Here are some elements that Pastor Knight suggests including in a thorough policy:
- Personal items may not be charged at any time for any reason.
- Cash withdrawals are not permitted.
- Credit card statements will be given to each card-holding staff member as soon as they arrive. Each person is responsible for attaching matching receipts and purchase orders for each charge to their statement and returning them to the bookkeeper within three working days of receipt of the statement.
- Misuse of the card will result in loss of card privileges or corrective action, up to and including termination of employment.
- If a receipt is lost, the staff member will pay for the item personally, unless other independent documentation is available. (Duplicates are often available from the establishment.) If no receipt is given, a paper signed by the clerk stating “no receipt” is needed with the date, cost of item, tax or tip (if applicable), and name of the store is acceptable.
- Credit limits must be respected. Charges for going over the limit will come out of the staff member’s ministry budget.
- Lost or stolen cards must be reported immediately.
As you prepare your ministry’s credit card policy, here are a few more tips to keep in mind:
- For each person needing a card, issue it in his or her name and assign a monthly credit limit.
- Keep credit limits low with the ability to raise the limits with an approved request, based on events and seasons of the year.
- To help control expenses and manage credit limits, consider a policy where staff members check out cards when needed and return them when they’re finished.
- Require each card-holding staff member to sign your credit card policy.
- Lastly, check with your accountant for additional recommendations on what to include in your policy.
Used wisely, credit cards can keep staff efficient and your ministry humming. For more tips on managing employee credit cards, check out Vonna Laue’s article Credit Card Use in Churches Can Be Good, Bad, or Just Plain Ugly as published in Church Executive magazine.