1. Using P/Cards in a B2B eProcurement Environment

2. Overview mymarket.com – Introduction UCT P/Card Background
Survey - Using P/Cards as a mechanism for B2B settlements
UCT P/Cards – coupled with B2B purchasing

3. Who is mymarket.com? 100% owned by Bidvest Trading since July 2001
Web based electronic platform - Provide online procurement & travel booking systems to our clients (including PURCO SA member institutions) and nominated suppliers
A secure and confidential market place (closed marketplace)

4. mymarket.com – What we do?
Assist clients to facilitate all buyer and supplier trade via an electronic platform over the internet – one platform
Ensure ERP / back-end / financial controls are maintained (Integration)
Enable Procurement to do more strategic tasks
Consolidation of the supplier database & Categorisation of suppliers within the various aspects of business
Enable buyers to reduce procurement / travel operating costs and streamline internal process flows
Online travel management system (Automation)

5. UCT – Purchasing Cards Background: Implemented more than 10 years ago
The UCT Purchasing Card (PCard) is a VISA product issued by Nedbank to authorised UCT staff members.
Provides a convenient and cost effective alternative purchasing tool for certain categories of purchases.
Includes low value items (often higher volume) and those normally paid via labour intensive (and therefore costly) administration processes, example:
petty cash
staff reimbursements.
Unapproved transactions are reported out of SAP (ERP) for transactions that have not been allocated to a fund and cost object.
UCT is one of Nedbanks largest wide scale users of P/Cards
in South Africa – Approximately 2000 card holders

6. UCT – Purchasing Cards
P-cards - reduce the number of purchase orders in SAP
The cost of processing a P-card payment is in the region of R 120
P-card administrator - manages new P-card applications, closing of P-cards should a staff member leave UCT, limit increases where necessary, etc.
Safety Nets built into the process - SMS notifications to the P-card holder when a transaction takes place on the P-card.  Incl. balance alerts
P/Cards & Travel
The real process cost of raising a PO in SAP (from the initial PO creation until payment of the vendor) to pay for an air ticket is approximately R 750
Should a booking include a car and/or hotel (where the SAP user has to wait for the invoice from the vendor and then update the PO in SAP with additional charges like breakfast and extras at hotels and fuel, contract fee, airport surcharge, etc, for car hire) the cost of the payment process is more than R 1 000 per purchase order

7. Survey – B2B Payments (2015 Australia and New Zealand Research report – Deloitte)
150 medium and large organisations making B2B payments
• 2/3 in Australia, 1/3 in new Zealand
• 90% commercial businesses, 10% public sector organisations
• Included users and non-users of cards
• Focus on both buyers and suppliers
Source:

8. Survey Findings: Buyers
75% - - Reduced payment processing times
68% reduction - in Accounts Payable administration functions
Cheaper - total cost of payments by card compared favourably to other mechanisms and to traditional PO processes
Invoice Processing Costs:
$20 (AUD) – R P/Card Solutions
$73 (AUD) – R ‘Manual’ Creditors process

9. Survey Findings: Suppliers
61% - less effort chasing payments
60% - Improvement in customer relationships
51% - Improvement in reconciliations
73% - Improvement in cashflow
Additional Benefits:
Reduced paperwork and streamlined accounts receivables process
Cost savings through reduced processing effort
No changes or modifications to existing card acceptance procedures

10. UCT – P/Card Solution Combined with B2B eProcurement – mymarket.com
Approved vendors only
Authorised products only
Pre-Approved pricing structures
Authorised purchases (business approvals)
Allocated fund spend (financial – fund centre commitment)
Benefit of 30 Day Account type services from supplier
Desk top delivery services
Usage analysis
Streamlined ordering
Maintain financial controls for SAP

11. How It Works
UCT Departments are issued purchasing cards for Procurment Spend
Participating suppliers need to be enabled for P/Card transctions
A (Nedbank) merchant account number is issued to participating suppliers
Supplier is setup as a P/Card supplier & catalogue published on mymarket
UCT user is requested to capture Purchasing Card details when raising an order against supplier (for verification and authorization purposes)
Bank authorization is obtained for the transaction
UCT authorization is issued for the financial expense (order approval)

12. Payment to Vendors (P-card)
Only first time purchase for a user forces card capture (bank returns a Transaction reference index for all future transactions)
Transaction reference index remains valid for 12 months
UCT does not have to reveal full card details to supplier (added security measure).
Only UCT P/Cards will work in the solution – BIN Restriction (1st 6 Digits unique to UCT)
Supplier receives online order and delivers as normal
Supplier submits XML (electronic) invoices to mymarket
mymarket Auto Matches invoice to PO (no over receipt in terms of Rand Value or Qty)
mymarket sends batch settlement requests to Nedbank (Iveri) daily
mymarket sends level 3 invoice data to ICS (Integrated Commmerce Solutions)

13. Payment to Vendors (P-card)
Bank settles the vendor for the invoice
Bank passes the banking transaction to ICS
ICS match the supplier invoice to the banking transaction
ICS update UCT SAP System with the banking record – including level 3 data (i.e.: what items were purchased with the banking transaction)

14. Back Office - Matching of Transactions

15. mymarket P/Card Ordering Process

16. mymarket P/Card Ordering Process

17. mymarket P/Card Ordering Process

18. mymarket P/Card Ordering Process

19. Asset Identification
Should the value of a shopping cart exceed a certain amount the user will be asked if the item purchased is an Asset
The user has to click a Yes or a No button and mymarket keeps an audit trail of the response
Should the user click the Yes button a pop-up message will appear explaining the Asset purchase process at UCT. At this point the shopping cart will be cancelled
Should the user click the No button the cart will be submitted and sent for approval

20. mymarket – Supplier Invoice Submission

21. Questions
Thank you
Paul Morel