U.S. Government Credit Cards and Micro Purchases
The U.S. Government purchases supplies and services in a variety of ways such as posting solicitations for supplies or services they need to places like FedBizopps or DIBBS. They also purchase items, micro purchases directly from companies using their Government credit card.
U.S. Government Credit Cards
Does the government use credit cards?
Yes, the U.S. Government has used purchase cards (IMPACT cards, Credit cards) for over 30 years to buy supplies and services. The Government Purchase Card (GPC) program was created in the late 1980’s as a way for federal agencies to streamline the acquisition process by providing the end user an efficient way to obtain goods and services directly from vendors rather than processing request through Government procurement offices. The National Defense Authorization Act for fiscal year 1998 said by October 1, 2000, “at least 90 percent of all eligible purchases made by the Department of Defense for an amount less than the micro-purchase threshold shall be made through streamlined micro-purchase procedures”.
What is an IMPACT card?
International Merchant Purchase Authorization Card
What is a micro purchase?
A micro purchase according the Federal Acquisition Regulation (FAR) is “an acquisition of supplies or services using simplified acquisition procedures, the aggregate amount of which does not exceed the micro-purchase threshold”.
What is the micro purchase threshold 2019?
The micro purchase threshold according to the Federal Acquisition Regulation (FAR) as of May 2019 is $3,500. There are some exceptions – see Federal Acquisition Regulation (FAR) Part 2 – Definitions of Words and Terms https://www.acquisition.gov/content/part-2-definitions-words-and-terms
Contract for Credit Card Services
The General Services Administration (GSA) Federal Acquisition Service (FAS) Office of Acquisition Operations, Office of Travel, Motor Vehicles and Card Services (QMA) recently awarded two $700 Billion dollar contracts for the GSA SmartPay program.
GSA SmartPay Details:
What is SmartPay?
The SmartPay program is the largest government-wide charge card services program in the world. It is run by the General Services Administration (GSA) a department of the U.S. Government. It is said to support more than 560 agencies/organizations around the globe. In fiscal year 2016 U.S. Government agencies/organizations spent $28.5 billion using the GSA SmartPay purchase card.
GSA established the SmartPay program in 1998 and the current program name is SmartPay 3. Over the past 21 years the program has evolved and grown. The previous master contracts were under the name SmartPay 2 which ended in 2018.
GSA SmartPay covers four main areas: Fleet, Travel, Purchase and Integrated solutions.
Fleet: Fueling and maintenance of vehicles, boats, planes or equipment.
Travel: Travel such as Airfare, car rentals, lodging and meals.
Purchase: Day-to-day business purchases necessary to run an organization.
Integrated solutions
Interesting SmartPay Facts:
In December 2018 there were close to 3.3 Million government credit card holders under the GSA’s SmartPay program.
In November 2018 the Department of Defense had over 81,000 SmartPay “Purchase” credit card holders.
Banks use what are known as a Merchant Category Codes (MCCs) to identify different types of businesses. Merchant Category Codes are reported on some U.S. Government spending reports.
Here are a few code examples with vendors who supplied the items:
Code – Title – Vendor
5942 – Book stores – Amazon
5200 – Home supply warehouse stores – Home Depot
5732 – Electronics stores – Apple
Some government agencies block certain MCC codes to prevent misuse of the credit card.
Who are the top 5 big box stores the Government buys from?
In 2018 the U.S. Government spent a total of $74 Million dollars with the following companies using credit cards. The top 5 big box stores selling to the US Government are Home Depot, Walmart, Lowes, Office Depot, and Ace Hardware. Sales are based on 2018 SmartPay chip cards (credit card) data.
See the chart below the breakdown of sales.
Since the U.S. Government encourages its employees to use credit cards to make purchase for supplies under the micro-purchase threshold of $3,500.00 they could potentially NOT buy from your company if you did not accept credit cards. One question as part of your System for Award Management (SAM) registration to get your CAGE code is “do you accept credit cards as a method of payment ?” https://sam.gov/SAM
SmartPay Contracts – Details
Previous Contract – This contract expired on November 2018
Program name: GSA SmartPay 2 (SP2)
Master Contract Numbers & Company:
GS-23F-T0002 – J.P.Morgan Chase
GS-23F-T0003 – Citibank
GS-23F-T0004 – US Bank
Current Contract – Began in November 2018, will continue through 2031 is all options are chosen.
Program name: GSA SmartPay3 (SP3)
Master Contract Numbers & Company:
GS-36F-GA001 – US Bank
GS-36F-GA002 – Citibank, N.A.
Solicitation Number GS10F17LPP0003
General Services Administration
Office: Federal Acquisition Service (FAS)
Location: Office of Acquisition Operations, Office of Travel, Motor Vehicles and Card Services (QMA)
Product Service Code (PSC) R710 Support- Management: Financial
NAICS 522110 Commercial Banking
Office code: 47QRAC
The Office of Professional Services and Human Capital Categories (PSHC) is responsible for the strategic leadership, oversight, and management of FAS’s professional services, human capital services, and charge card management programs and contracts.
BidLink has been a leading provider of DOD procurement research tools and data for the past 20 years. Find defense contracts, solicitations, sources for items, and research competition. Learn more at www.bidlink.net
Tweet