What’s New with GSA SmartPay®?

1
Whats New with GSA SmartPay?
May 2006
2
Agenda

• Welcome
• Program Overview
• GSA SmartPay 2
• Transition
• GSA SmartPay Program Management
• What Does This Mean for Me
• Questions and Answers

3
Program Overview

• Original GSA SmartPay established in 1998
• Enables agencies to obtain Purchase, Travel,
  Fleet, and Integrated Charge Cards, through a 10
  year Master Contract (5 year base, 5 one-year
  options) with five banks Citibank, Bank of
  America, JP Morgan Chase,
• U.S. Bank, and Mellon (purchase only)
• Provides program service to over 350 Federal
  agencies, organizations, and Native American
  tribal governments

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Program Overview

• Over 92 million purchase, travel, and fleet
  transactions processed in Fiscal Year 2005
  through 2.6 million cards
• Total program spend of nearly 25 billion in FY
  2005
• Earnings of over 118 million in agency refunds
  in FY 2005
• Existing contracts end November 2008
• Recompetition effort under way (GSA SmartPay 2)

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Program Overview

• Why Cards?
• Administrative savings and efficiency, estimated
  at 1.4 billion in administrative processing cost
  avoidance in FY05 for purchase cards alone
• Rebates based on dollar volume and payment
  performance
• Worldwide acceptance
• Access to merchants offering Point-of-Sale
  discounts, including Office Depot, Home Depot,
  etc.
• See www.gsa.gov/gsasmartpay Emergency Charge
  Card Use Information for further details (click
  on the merchants hyperlink)
• Travel card accesses City Pair Program
  discounted fares on airlines, bus, train
• 72 percent average discount off comparable
  commercial fares total savings from this is
  anticipated to be more than 2.8 billion in FY06
  alone
• Provides electronic transaction data, enabling
  better reporting

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Program Overview
FY05 - 17 billion in spend 26 million
transactions 300 thousand cardholders
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Program Overview
FY05 - 7 billion in spend 43 million
transactions 1.9 million cardholders
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Program Overview
FY05 - 1 billion in spend 24 million
transactions
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Program Overview
CY
Average delinquency rate was 3.35 in FY05,
close to that of corporate card programs
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GSA SmartPay 2

• Future Program Development
• The GSA SmartPay team has conducted extensive
  industry
• and customer research including
• Customer survey (437 respondents)
• 91 stakeholder interviews
• 4 focus groups
• 10 panel discussions
• Request for Information (RFI) and
• Industry meetings

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GSA SmartPay 2

• Future Program Development
• Through this program review process, GSA
• Gathered comprehensive requirements that
  represent the diverse feedback of program
  customers and stakeholders
• Gained insight into industry trends and
  regulations that impact the program now, and may
  in the future and
• Obtained buy-in from customers and stakeholders
  who have been receptive to GSAs collaborative
  approach to future program planning efforts

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GSA SmartPay 2

• Future Program Development
• Utilizing research results, the GSA SmartPay
  team is focusing on
• improvements to these areas
• Program Controls Continued emphasis to help
  prevent and detect card fraud and misuse
• Security Increased emphasis on security of both
  employee and procurement data to minimize the
  risk to individual cardholders and to national
  security
• Customer Service Improvements intended to build
  stronger GSA-Agency-Bank relationships

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GSA SmartPay 2

• Future Program Development
• Use of Data Improved access to data and data
  management tools at the agency and
  government-wide level to support key initiatives
  such as strategic sourcing, risk identification,
  and general program reporting
• Program Technology Increased emphasis on
  technologies for account management and
  streamlining billing and payment processes to
  generate greater cost savings to the government
• Tax Exemption and Reclamation Technology and
  support to avoid payment of taxes at the point of
  sale and assist in reclaiming paid taxes

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GSA SmartPay 2

• Future Program Development
• Advocacy and Leadership Increased
  representation on behalf of agencies to the
  stakeholder community (e.g., oversight agencies,
  Congress) and banks
• Program Flexibility Providing agencies with
  flexible options for accessing and customizing
  program offerings to address their unique
  operating needs and issues, including
  international card use
• Program Education and Support Providing
  guidance and training on key program issues and
  enabling forums for the sharing of program
  leading practices among agencies

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GSA SmartPay 2

• Future Program Development
• Support for government-wide initiatives
  Providing support for key initiatives such as
• Strategic sourcing (Leveraging the buying power
  of the government to achieve savings and best
  value procurements)
• Shared services (Consolidating administrative
  activities into a single unit, to increase
  productivity by allowing the core operations
  divisions to focus more of their time on mission)
• Risk identification and mitigation (Practices
  that highlight potential areas of risk for the
  card program and proactively address them)
• Program performance reporting (Collecting and
  using program data to develop reports that
  measure program performance)

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GSA SmartPay 2

• Future Products and Services
• The GSA SmartPay team is also focused on
  supporting agency needs by augmenting standard
  charge card offerings with new payment products
  and services (card and non card) at the Master
  Contract Level. Examples include
• Contactless cards Standard magnetic stripe card
  with additional integrated circuit chip
  capabilities and contactless transponder
  technology. Secure, improves speed of
  transactions, and the card does not leave the
  hand of the cardholder

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GSA SmartPay 2

• Future Products and Services
• New payment products and services at the Master
  Contract Level (continued)
• Debit cards Charge card alternative processes
  transaction debits against a linked account/fund
  within established dollar limits. Helps to
  control amount of outstanding credit with
  cardholders
• Pre-paid (stored value) cards Charge card
  alternative supports the capability to load and
  reload cards with specific dollar values. Cards
  can be issued with required value on short notice

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GSA SmartPay 2

• Future Products and Services
• New payment products and services at the Master
  Contract Level (continued)
• Cardless accounts Alternative to plastic
  provides established vendor-specific charge
  accounts without physical cards
• Travelers and convenience checks Improved
  ability to issue and reconcile checks online,
  such as
• Passing merchant name in transaction data
• Online imaging of cleared checks
• Electronic bill payment Ability for individually
  billed cardholders to pay their accounts online

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GSA SmartPay 2

• Future Products and Services
• New payment products and services at the Master
  Contract Level (continued)
• Improved interface with agency systems Improved
  level of coordination between bank EAS systems
  and agency travel systems, in addition to
  financial, and ordering systems. This allows the
  potential for travel systems to coordinate
  activation of cards with the travel authorization
  process
• Association program management tools Vendors
  will be required to offer tools that are provided
  by associations that support program management
  objectives such as data mining, strategic
  sourcing, etc.

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GSA SmartPay 2
FY05
FY07
FY08
FY06
FY09
Fall 2004
Spring 2005
Fall 2005
Fall 2006
Fall 2007
Fall 2008
Spring 2006
Spring 2007
Spring 2008
Acquisition Planning Phase

• Future program requirements
• Request for Information
• Press release
• Acquisition strategy
• Source Selection Plan

Acquisition Management Phase

• Draft Request for Proposals
• Request for Proposals
• Contract award/s

Transition Planning Phase
Transition Management Phase
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Transition
FY06
FY08
FY09
FY07
Spring 2006
Fall 2006
Fall 2007
Fall 2008
Spring 2007
Spring 2008
Spring 2009
Fall 2005

• The GSA SmartPay program office will
• Work closely with agencies and banks to
  facilitate a seamless transition
• Develop transition planning tools for agency use
• Establish BPAs for transition support contractors
  to help agencies in transitioning to the new
  program
• Plan and prepare for the transition to minimize
  impact on cardholders

Now
AwardContracts
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Transition
FY06
FY08
FY09
FY07
Fall 2005
Spring 2006
Fall 2006
Fall 2007
Fall 2008
Spring 2007
Spring 2008
Spring 2009
Now
AwardContracts

• Cardholders should look out for communications
  with instructions on your key responsibilities
  during the transition, including
• Filling out a new card application
• Activating a new card
• Destroying your old card and ensuring no
  transactions continue to be made on it (e.g.,
  automatically billed subscriptions)
• Completing any new training
• Contacting the A/OPC if you have any issues or
  questions
• Ensure that all transactions with your current
  bank are reconciled

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GSA SmartPay Program Management

• The GSA SmartPay program office is committed to
  providing leadership and advocacy to customer
  agencies on regulations and common issues
  impacting the program, such as OMB Circular A-123
  Appendix B, Improving the Management of
  Government Charge Programs, which went into
  effect October 1, 2005. The Circular
• Consolidates and updates government-wide charge
  card program requirements and guidance issued by
  various government agencies
• Outlines requirements affecting all three
  business lines of the government charge card
  program (e.g., travel, purchase, and fleet)

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GSA SmartPay Program Management

• The Circular (continued)
• Contains requirements related to many aspects of
  charge card programs (e.g., training,
  creditworthiness, salary offset, split
  disbursement)
• Requires agencies to develop a Charge Card
  Management Plan
• GSA SmartPay has developed a Charge Card
  Management Plan Template as a resource for
  agencies/organizations to utilize as they develop
  their charge card management plans

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GSA SmartPay Program Management

• OMB Circular A-123 Appendix B
• Training
• The Circular requires that all charge card
  program participants are trained prior to
  appointment and that all program participants
  take refresher training, at a minimum, every 3
  years
• The Circular also requires that training records
  be tracked and maintained

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GSA SmartPay Program Management

• OMB Circular A-123 Appendix B
• Creditworthiness
• The Circular requires agencies to perform credit
  checks on all new cardholders. (The current
  Circular is based on the FICO scoring system the
  program office is tracking a new scoring system,
  VantageScore, which is being developed)
• However, the FY 2006 Transportation, Treasury,
  and Housing and Urban Development Appropriation
  Bill (TTHUD), signed after the Circulars
  release, eliminates the requirement for credit
  checks on centrally billed accounts. (Note It
  did not eliminate the requirement for credit
  checks on individually billed accounts)

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GSA SmartPay Program Management

• OMB Circular A-123 Appendix B
• Risk Management
• The Circular requires agencies to implement risk
  management controls, policies, and practices
• This includes requiring agencies to implement
  salary offset and split disbursement procedures,
  unless an official waiver is obtained

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What Does This Mean for Me?

• Contribute to the development of the future
  program. We would like to hear from you. Share
  your cardholder experiences and ideas with your
  AOPC or contact the GSA SmartPay team
• Stay informed on the upcoming transition to the
  future program. The following are good sources
  of information
• GSA SmartPay website at www.gsa.gov/gsasmartpay
• Statement Inserts
• Statement Messaging
• Emails and guidance from A/OPCs

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What Does This Mean for Me?

• Stay compliant with the requirements of the
  program
• Pay account bills on time
• Stay current with program training, including the
  required refresher courses (on the GSA SmartPay
  2 website)
• Use the card in accordance with all agency and
  government guidelines
• Continue being a good cardholder. Buy right,
  buy smart

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Questions and Answers

• David J. Shea CPCM, PMP
• david.shea_at_gsa.gov
• [phone]
• Provide your feedback and thoughts about the
  current and future program at www.gsa.gov/gsasmart
  pay, under GSA SmartPay Program Feedback
  Form, or call David Shea