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Pro-card Cardholder Limits

Summary: Learn about the various limits supervisors may place on purchasing cards for their employees.

Three types of cardholder limits work in tandem to control the use of the pro-card. Supervisors must determine the cardholder limits for each cardholder account, establishing the limits with consideration to the unit's objectives and budget and the purchasing needs of the cardholder. Each time a supplier swipes a card (or uses other mechanisms to contact the Bank) to request a transaction authorization, the cardholder's account is checked to ensure the purchase is within the cardholder limits established for the card. The three types of limits are described below:

• Single Purchase Limit: The maximum dollar amount per purchase the cardholder may transact with a supplier. The maximum dollar amount per transaction a supervisor can establish is $2,500 per charge.
• Daily Single Purchase Limit: The total dollars the cardholder can spend per day. A maximum single purchase limit has not been established for the campus.
• Credit Limit: The total dollars the cardholder can spend during a monthly cycle. (Monthly cycles begin on the 11th of the month and end on the 10th of the following month). A maximum credit limit has not been established for the campus.

Sample credit limits and an example of how they work in tandem:
Jane is issued a pro-card with the following controls:

• Single Purchase Limit: $500
• Credit Limit: $5,000

1. On Tuesday the 15th, Jane is preparing for an event. She purchases, from ten merchants, supplies totaling $500 per order. At this point, Jane has reached the maximum dollar amount allowed for the month (credit limit). Merchants will reject her card until the credit limit is refreshed at the beginning of the new cycle on the 11th of the following month.
2. During the following month Jane makes 21 purchases that total $4725. On the last day of the cycle Jane tries to place an order for $300. The merchant rejects her card because she has tried to exceed her credit limit.

Merchant Category Code Group (MCCG) Restrictions: The campus places a restriction on each card that prohibits the cardholder from making travel and entertainment related purchases, receiving cash advances, and purchasing other types of services from financial institutions. These restrictions are imposed through a Merchant Category Code Group (MCCG).

Additional Restrictions: In addition to cardholder limits, supervisors may place restrictions on the card based on the individual cardholder's purchasing needs. Examples of the types of restrictions that may be placed on the card include:

• Types of products (e.g. only office supplies, automotive supplies, lab supplies, computing supplies, etc.)
• Types of suppliers (e.g. only lab supply distributors, office supply retailers, book suppliers, etc.)
• Specific suppliers (e.g. only Palace Arts, Safeway, San Lorenzo Lumber, etc.)

These restrictions are documented on the Pro-card Application and Agreement form. They are not encoded in the credit card system and thus must be observed by the cardholder and monitored by the supervisor. Any restrictions placed on the card must be reviewed with the cardholder prior to issuing the pro-card.

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Last revised: August 17, 2009 (am)