1. Michigan Community College Association Conference
Bank of America’s Treasury Management Solutions: An Introduction to Purchase Card and ePayables
November 7th, 2013

2. Agenda Introductions MiDeal Overview Purchasing Card Overview
Works Technology
Payment Automation ePayables
Next Steps
Questions

3. Introductions Client Management Client Team Extended Team Client
William Mungai
Vice President, Client Manager
Public Sector Banking
Phone:
Christopher Brin
Vice President, Treasury Solutions Officer
Public Sector Banking
Phone:
Joseph (Joe) Kiss
Senior Vice President, Senior Client Manager
Public Sector Banking
Phone:
Kenneth (Ken) Harroun
Vice President, Treasury Solutions Officer
Public Sector Banking
Phone:
Extended Team
Nancy Cournaya
Vice President, Senior Card Account Manager
Card Account Management - Central
Phone:
Client

4. Mi Deal Overview: State of Michigan Procurement Card Services

5. Benefits of Mi Deal / State of Michigan
State of Michigan Procurement Card Services (Mi Deal)
Bank of America is the provider for the State of Michigan Electronic Payment Card Services – Statewide Procurement Card Contract since Under the Contract, Bank of America provides purchasing card and ePayables services to municipalities and government bodies within the State as long as they are a member State of Michigan Mi Deal program and meet the program volume requirements.
Purchasing Card participant volume requirement of $1,000,000 annually
A current listing of approved program members is available at:
Benefits of Mi Deal / State of Michigan
The need to go through the RFP process is eliminated
Easy enrollment
No program or cardholder fees
Networking and Best Practices
Assigned Card Account Manager
Assigned Card Account Specialist for servicing needs
Works application to manage your card program
Rebate rate tier determined by adding state and local government bodies

6. Purchasing Card Overview: Replacing Check Payments

7. Purchasing Card: Replacing Check Payments with a Card Solution
Many of our government clients have embraced the electronic payment process because it provides a unique opportunity to reduce expenses and increase efficiencies. More importantly, it minimizes the risk of fraud and increases transparencies for auditors and constituents alike without changing the accounts payable processes currently in place.
Purchasing cards are the quickest and easiest way to eliminate low dollar/low value transactions
Purchasing Cards fit perfectly into most organization’s AP process and can drive out paper in a short amount of time
The average organization has the potential to more than double the number of transactions under $2,500 that are paid by p-card and increase fourfold the number of transactions from $2,500-$10,000.
Penetration in P-card spending payments has increased for office equipment, travel, computers, maintenance/repair/operations, telecommunications, printing & duplicating, media/advertising and transportation/delivery services.
P Card spend increased nationwide 17.6% from

8. Purchasing Card: Controls and Fraud Protection
Manage cards in real time – at the push of a button within Works, increase/decrease funds on card or disable cards in real time
Dispute transactions
Ability to offer zero-dollar cards and declining balance cards for optimized control
Enforce corporate and individual spending policies
Block merchants using Merchant Category Codes (MCC)
Impose single transaction limits, daily/weekly/monthly spending limits
Fraud Prevention:
Bank of America has instituted a number of procedures to decrease exposure to fraud including:
Card PIN Activation
Card Expiration Date
Card Verification Value
Physical Card Features
Bank of America was recently recognized by Javelin (an independent research and study entity) for the 8th straight year as ‘Best in Class’ for Fraud Detection/Prevention, Servicing, and Claims Resolutions in 2013 for our card programs.
The survey was done across the top 25 card issuers
Bank of America scored a 79 which was 8 points ahead of our closest competitor CitiBank
The average score across all participants was 55

9. Works Technology: Card Management and Online Reporting at your fingertips

10. Purchasing Card Online Reporting Tool: Works®
Card maintenance and Active Card Controls
Easy integration into your ERP system
Spend monitoring for encumbered funds and discretionary/
incremental funds
Online hierarchy management
Pre-approval and post-approval workflows
Real-time manipulation of credit availability
Works®
The most innovative web-based electronic payment solutions systems in the industry
Data can easily be integrated into accounts payable systems with standard reports including receipt imaging & management
Custom reporting by spend by vendor, department, project, grant, GL code, hierarchy, etc.
Automated 1099 reporting
Automated Reconciliation
General Ledger (GL) allocation and export for GL upload
Tools to mitigate fraud:
Real-time card controls including card issuance and suspension
Optional pre-purchase approval process
Declining balance card issuance
Merchant Category Code (MCC) restrictions and transaction limits to purchasing authority
Works® accommodates unique cardholder, manager, auditor, accountant and administrator permissions
Two years of online data retention

11. Payment Automation: Replacing Checks with the Bank of America Vendor Card solution, ePayables

12. ePayables: How does the Service Work
Bank of America Merrill Lynch was the first to market with the solution and is the largest issuer of ePayables programs, processing more than $12 billion and 2.1 million transactions in 2012.
ePayables is a complementary solution to the Purchasing card designed to further increase payment transformation from check to a card solution. In order to qualify we can perform a vendor analysis for you and provide a sample proforma of expected enrollment. The minimum requirement to participate is to have an expected vendor enrollment figure of $2 million based off of the vendor analysis.
Replace 30-40% of non-payroll AP check volume
Turns a costly check into a “free” electronic payment
Eliminates per-item banking fees and processing costs
Optimizes your efficiency and working capital
Extends float opportunity and provides cash payout incentives
Requires no changes to the upfront accounts payable process
Enhances transaction risk management
Client ERP/AP System
Invoice received and approved to pay
Works processes AP file
Works funds card
ePay– vendor charges card
Push pay – payment pushed to vendor’s merchant account
Card processor

13. Electronic vs. paper payment processes at a glance
Record of payment
Payment action
Remittance advice
Vendor cash received
Client paid cash
Confirmation of payment
Check run file
Print on check per supplier ID
Check stub with invoice line-item detail
Check deposited; funds clear in 5-7 days
Cash withdrawn upon check clearing
Positive pay file
Card run file
Dynamically fund one card number per supplier ID
notification with invoice line-item detail
Card transaction authorized; cash transferred in 2-3 business days
Bank statement paid in days after transaction posts
Works® exports file with posted card transaction details
Payment method
Check
ePayables Payments

14. The Value of ePayables BUYER BENEFITS Reduce costs and efficiencies
Make AP payments with no transaction fees
Incentive cash payouts based on spend
Increases float for improved cash flow
Improve transaction risk management
Helps control card payments by only authorizing pre-approved payment amounts
Reduced risk of fraud through elimination of checks and cards issued with $0 credit limits
Improve buying power by offering your vendors a faster, more reliable payment option
Further payment automation strategy
Replaces costly paper payment with low- cost electronic payments
Provides vendor enrollment support
More than 75,000 vendors enrolled to accept ePayables on approved invoices
SUPPLIER BENEFITS
Control and costs
Receive electronic payments without need to give bank information to customers
Reduced payment receipt processing cost by eliminating paper payments
Uses existing card technologies, processes and protections
Relationship
Strengthens relationship with buyer while reducing the costs and risks associated with paper payments
Efficiency and float
Remittance data transmitted electronically with payment for easy application to account
Funds made available on card at time of remittance (remittance can be via or fax)
Improve Days Sales Outstanding (DSO)

15. Starting a Purchasing Card or ePayables program with Bank of America

16. Your Bank of America client team are here to help.
Next Steps
Please contact your client manager or treasury solutions officer to setup a follow up discussion.
Review the State of Michigan contract to see how it can help your organization earn a rebate for utilizing a Purchasing Card / ePayables program.
Create a customized financial benefit analysis for your organization to see the value of converting to an electronic card solution.
We are pleased to offer a one on one demonstration of our proprietary online reporting tool and card management application, Works™ for your organization.
Your Bank of America client team are here to help.
We can help you understand what is available in the market and
what fits best for your organization.

17. Questions

18. Notice to Recipient
"Bank of America Merrill Lynch" is the marketing name for the global banking and global markets businesses of Bank of America Corporation. Lending, derivatives and other commercial banking activities are performed globally by banking affiliates of Bank of America Corporation, including Bank of America, N.A., member FDIC. Securities, strategic advisory, and other investment banking activities are performed globally by investment banking affiliates of Bank of America Corporation ("Investment Banking Affiliates"), including, in the United States, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Merrill Lynch Professional Clearing Corp., both of which are registered as broker-dealers and members of FINRA and SIPC, and, in other jurisdictions, by locally registered entities. Merrill Lynch, Pierce, Fenner & Smith Incorporated and Merrill Lynch Professional Clearing Corp. are registered as futures commission merchants with the CFTC and are members of the NFA. Investment products offered by Investment Banking Affiliates: Are Not FDIC Insured * May Lose Value * Are Not Bank Guaranteed.
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