Taiwan Governmnet Purchasing Card Programme
The Scenario
In a move to increase government efficiency as a response to slowing economic growth, the Taiwan's Executive Yuan began looking at the benefits of moving procurement to Visa Purchasing cards. The government chose to move forward in two phases. By the end of the first phase in mid-2001, a total of 33 government agencies were using purchasing cards, with over two-thirds choosing Visa. Starting in July 2001, the Public Construction Committee of the Executive Yuan expanded the Purchasing Card adoption trial to 50 more government departments.
How It Works
The Taiwan government is using Visa Purchasing for small-ticket purchases, business travel, and or petrol expenses, with the aim of cutting costs and improving cost-effectiveness. The Visa Purchasing card, which can be used in face-to-face transactions, on the phone and on the Internet, helps government agencies streamline and reduce the total cost of procurement. With no revolving interest payments, just a simplified cost-effective purchasing process, the card saves the agency time and money by greatly reducing the need for requisitions, approvals, purchase orders, invoices and checks giving staff more time to focus on more value-added activities. It also places the authority to incur expenditure in most cases with the person who is actually doing the purchasing.
The Results
The Executive Yuan concluded that the government can achieve 64 percent savings in time and 56 percent savings in purchasing costs by adopting Visa Purchasing. This was based on usage by four of the government agencies and state-operated business units that were using Visa cards in the first phase of the program. The government was attracted by the widespread global adoption and strong acceptance of Visa Purchasing.
The 33 departments adopting purchasing cards in the first phase of this government pilot included the Central Bank, National Tax Bureau of the Ministry of Finance, Ministry of Economic Affairs, Directorate General of Budget, Account and Statistics of the Executive Yuan, Ministry of Foreign Affairs. Two thirds of these agencies chose to use Visa cards.
E-Procurement
By integrating Visa Purchasing into an e-business system, government agencies look forward to even more benefits. Establishing an electronic purchasing system will minimize the need for the physical interface between government purchasing personnel and suppliers, break the time limit of traditional trading formats, reduce operating time, cut costs, and allow government personnel to focus on more value-added operations.
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