A procurement card is a type of company charge card used for smaller purchases to achieve greater cost efficiency, control and convenience. Procurement cards are also known as purchasing cards, P-Cards or PCards.
Procurement cards can be tied to either a credit card or a bank account. The bank that manages a procurement card will issue payments to payees within days, while providing monthly invoicing to the client company. Procurement cards offer greater cost efficiency over traditionally paid purchase orders because they avoid the more time- and resource-intensive purchase order process, which involves more employees creating and reviewing documentation and invoices and issuing checks.
Security measures for procurement cards include setting per-purchase and per-month dollar limits. P-Cards may also feature spending restrictions for the types of purchases allowed and merchant category codes that define where purchases can and cannot be made. The card issuer usually sends the client organization an single invoice for all transactions at regular intervals; employee purchases are typically reviewed on a monthly basis.