Many P&C clubs and societies are finding that they are being offered debit cards on their bank accounts. They can be issued to authorised staff or volunteers who need to make purchases on behalf of the organisation. They require careful management and oversight to avoid potential problems. But before you get one, it’s a good idea to understand how they work in terms of a society and what their drawbacks are.

Many people have their own debit cards, and so they think that having a debit card for a not-for-profit or community organisations is going to be almost the same thing. This is not necessarily the case. There are certain complications that should be watched.

Eligibility and requirements

Debit cards are a handy way to allow you to access your own money from your organisation’s bank account, without the need for cheques or cash. You’ll be able to use them for things such as for office supplies, travel costs or event catering.

To apply for one you’ll need to meet some strict eligibility requirements. The big one you’ll have to tick off is organisation must be a registered not-for-profit entity in Australia, such as a charity, school, government body, club, association or religious organisation. You’ll also need to provide proof of your organisation’s not-for-profit status, such as a certificate of incorporation, an Australian Business Number (ABN) or a letter from the Australian Charities and Not-for-profits Commission (ACNC).

Make sure you also have a bank account with the institution already, this way your debit card can be easily linked to that account. Ensure that you have the details and identification of the authorised signatories for your organisation’s bank account and debit cards. The signatories are the people who can access and use the debit cards on behalf of your organisation. You may need to provide copies of their driver’s licence, passport or other ID documents.

Options and features to compare

The good news is that if you are looking for a debit card account you have several options to choose from. It’s important to compare a range of accounts to make sure it has the right features you need. These are just some of the debit card accounts for not-for-profits and community organisations in Australia:

Westpac Community Solutions One
This account is designed for charities and other not-for-profits that operate on a non-profit or charitable basis. It has no monthly fees and no transaction fees, including online and in-app payments and in-branch banking. You can also link an optional cheque book to your account, and access a variety of banking channels such as online, telephone and debit card. You can also complement your everyday account with a Community Solutions Cash Reserve savings account.

NAB Community Fee Saver Account
This account is suitable for not-for-profit organisations and community groups that mainly bank online. It has no monthly fees and no transaction fees for electronic transactions, such as EFTPOS, NAB Internet Banking, NAB Connect and NAB Telephone Banking. You can also link a NAB Business Visa Debit Card to your account, which allows you to make purchases and withdraw cash anywhere Visa is accepted. You can also access tailored investment solutions and ethical investing options through NAB’s partnership with JBWere.

CommBank Society Cheque Account
This account is available for eligible not-for-profit and community organisations and associations, and organisations that operate for the benefit of the wider community. It has no monthly fees and no transaction fees for electronic transactions, such as NetBank, CommBiz, ATM, EFTPOS and BPAY. You can also link a CommBank Business Mastercard Debit Card to your account, which allows you to make purchases online, over the phone or in person. You can also access a range of other products and services, such as overdrafts, term deposits, merchant services and financial planning.

When you are shopping around for your new debit card account, it’s important to consider the following factors:

• – Fees: How much will you pay for monthly fees, transaction fees, card fees and other charges? You might need to deposit a certain amount of money to get the fees waived.
• – Benefits: What are the benefits of using the account for NFP’s or community clubs
• – Drawbacks: Are there minimum balance requirements, withdrawal limits, service availability or other restrictions?
• – Eligibility: What are the eligibility criteria for opening the account, such as age, residency, organisation type or status?
• – Convenience: Do you only get online banking or a mobile app, telephone banking and branch network access?

Depending on what you want out of your new account, there may be other things that you need to add to your comparison.

Things to consider

One other complication to consider is that previously club and society cheque books had two signatories. This is not the case with a debit card.  The dual signatory system meant that the club could always be sure that at least two officers had decided that the purchase was necessary.  You’ll need to make sure there are strict rules and oversight to ensure your account runs smoothly. Make sure you set spending limits and authorisation rules for other account holders. You can ensure that your transactions are above board by checking your statements regularly.

Remember to keep receipts and records of all the debit card transactions. This can help you track your expenses and provide evidence for your accounting and reporting. You may also need to keep receipts for tax purposes or to comply with any conditions of grants received.

In Australia we have the National Standard Chart of Accounts (NSCOA) that offer a free data entry tool and data dictionary for charities and other not-for-profit organisations. It provides a consistent and standardised way of classifying and reporting your income, expenses, assets, liabilities, and equity. The good this is that all Australian governments have agreed to accept NSCOA when requesting information from not-for-profits.

Debit cards: a smart choice for community groups

So whether you secretary for the P&C or looking at starting a charity, a debit card could be a convenient way to help manage the clubs finances. Like most things, there are pros and cons to each but with the right governance on use, it could be a valuable tool.