Gov't credit cards to be widely used
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E-mail CRI, September 28, 2012
China plans to introduce government credit cards above the county level by the end of this year to make better use of official expenditures and minimize cash payments, the Beijing News reports.
The Ministry of Finance and the People's Bank of China said in an online directive issued Thursday that all central government units, including administrative branches, Communist Party organs and public institutions, should sign up for government credit cards before October.
A special UnionPay credit card, which would be used only for official expenses, such as business trips, receptions and cars, has a bank identification number that begins with the digits 628. Cards cannot be shared, and individual user information will be recorded by financial departments.
According to the directive, cash payments will not be accepted for government units that have been included in the credit card scheme. The rule also requires business sectors related to government expenditures, including hotels and gas stations, to accept credit card payments before spending occurs. In principle, no cash should be withdrawn from the cards.
Government credit cards were initiated in 2007. Central government units were the major users of the cards at the time, which had credit limits of 20,000 yuan-50,000 yuan.
Under the new directive, government credit card users will be reimbursed upon presentation of legitimate receipts and other evidence of credit card payments. Accountants will check whether the receipts are in line with a detailed reimbursement regulation, before allocating funds to credit card accounts.
An unidentified official from Beijing's Finance Bureau said all administrative departments at the city level and in nine districts and counties had adopted government credit cards. He also said the credit card scheme would cover all public institutions by the end of the year.
Mao Shoulong, a public administration policy expert at Renmin University of China, said government credit cards would help address receipt fraud which is closely related to cash payments and that officials would think twice before swiping the cards as all transactions would be recorded in the banking system.
But Mao cautioned that as a means of payment, government credit cards would not deter excessive spending. He pointed out that at present there are about 200,000 official accounts in a gray area where their capital flows are not subject to supervision by the country's treasury regulator.
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