Christian Leadership Alliance
| 
1 of 2
Credit Card Use in Churches Can Be Good, Bad or Just Plain Ugly
Transactions are handled so differently now than in the past. Society has moved from coins to paper money, checks, and now electronic forms of payment such as credit cards or electronic funds transfers.
I remember not that many years ago when I barely used a credit card and wrote a check for everything. Now I keep a pad of checks for nearly two years and even pay my credit card electronically. I'm shocked when I encounter a business that doesn't accept credit cards.
As people's habits change, so will the processes in your church. You may review your bank statements online and there is likely more of a push for credit card purchases by your staff or vendors. There are two primary ways that credit card transactions occur for church expenses. First, an employee buys something for the church on a personal credit card and submits for reimbursement. This is a simple process and they should follow the reimbursement plan that is in place. The second would be the use of a corporate credit card.
A corporate credit card allows a church to have a credit card in the name and on the credit of the church. Multiple cards can be issued to staff and the statement reflects the purchases of each individual. As with any other decision, there are several factors to consider.
Positive factors
Perks: The church receives any benefits offered by the credit card company.
Helpful: Staff members with limited personal credit are able to make purchases whereas they may have difficulty if they were required to put larger amounts on their personal credit cards.
Efficient: Some companies allow for electronic downloading of information for better efficiency in your accounting department.
Limits: Different credit limits can be assigned to the cards which allow you to assign the card based on purchase or approval restrictions already in place for individuals.
Negative factors
Documentation: It can be difficult to obtain the necessary documentation (receipts, approvals, etc.) from cardholders. However, the church has their credit at risk and therefore is required to make timely payments. Obtaining the information after the payment has already been made can be a cumbersome process.
Costs: There can be costs associated with this arrangement such as annual fees, bank fees or "hidden" fees such as lower interest rates on accounts.
Carrying debt: Costs could include late fees and interest charges. It is typically far more costly to carry balances on credit cards than to obtain a line-of-credit or other form of short-term debt if cash flow is tight.
635 Camino de los Mares, Suite 216, San Clemente, CA 92673 · (949) 487-0900