Rebate Credit Cards for AP Payments – FYI

Rebate Credit Cards for AP Payments – FYI

Accounts Payable departments faced with large volume transactions want options for efficiently paying invoices. Treasury departments want to reduce bank costs and fees wherever possible. Both can be accomplished with rebate commercial card programs offered by many financial institutions.  

These commercial-based programs have gained popularity in the last 5 years as an alternative payment method. Although the programs vary by bank, they all typically operate the same way: vendor/suppliers are signed up to accept these payments and AP departments use the commercial rebate card payment method instead of using checks, ACH payments, or wire transfers. Used across all industries by many companies, we’ve seen our clients benefit from the use of these programs.  

One of the key benefits to a rebate commercial card payment method is that the client receives the rebate at the end of the month while suppliers receive improved payment terms; the supplier in the program gets paid sooner, net15 typically.  

From a treasury perspective, commercial rebate cards offer improved cash flows efficiency in that funds are not debited from disbursement accounts until the end of the month. By reducing the need for continually having cash resources on hand, organizations are able to invest their cash pool during the weeks prior to month-end.   

Companies will also see a reduction in bank fees as well as increases in payment efficiencies. Treasury professionals want to offset and lower bank fees, and rebate commercial cards are a way to do this. At month-end, clients’ bank fees are reduced by utilizing the rebates from the credit card programs.  

For organizations in the healthcare industry and other industries that deal with frequent and high-volume payments, the benefits of rebate credit cards are especially realized. Having a rebate credit card payment system in place simplifies the process of internal AP departments dealing with these large and frequent payment transactions.

Contact Elire and we’re happy to walk you through the benefits of Rebate Cards from all of our financial partners. In the meantime, check out the Strategic Advisory Services page of our website for process optimization services.