Payment Data Systems Files Patent on Industry's First Debit Card Bill Payment Technology
 

- Forms Strategic Partnership to Reach 40 Million Unbanked Customers -


SAN ANTONIO, March 5 /PRNewswire-FirstCall/ -- Payment Data Systems, Inc. (OTC Bulletin Board: PYDS - News) an integrated electronic payments solutions provider, announced today that it has filed for patent protection from the U.S. Patent Office for the technology that will enable bill payment using a debit card. In expectation of this patent, Payment Data Systems has entered into a strategic relationship with Secure Cash Network, Inc. to provide the electronic payment industry's first bill payment debit card.

The debit card technology for which Payment Data Systems has filed for patent protection, allows a cardholder to use their stored-value Secure Cash Network debit or ATM card to pay local, national or international bills with the card from their electronic balance. Because it does not require linkage to a traditional checking or savings account, this new debit technology is unique in that it allows for use by 'unbanked' consumers.

Payment Data Systems, in anticipation of owning patent rights to this industry-first bill payment processing technology, has agreed to provide Secure Cash Network with a perpetual license for use of the technology as part of an initial roll-out strategy. However, the Payment Data Systems debit card bill payment technology can also be licensed by any provider of debit or stored-value cards and networks, including: MasterCard, Visa, and American Express among others.

President and COO of Payment Data Systems, Inc. Louis Hoch, said, "While trends clearly project extensive growth in demand for products and services available to unbanked consumers -- who now represent a worldwide market potential of $1.1 trillion -- traditional payment processing products and services have been expensive and are not easily accessible. Payment Data Systems expects to become a market leader in the payment services sector by establishing first entry into this underserved segment of the marketplace with our superior payment processing solutions."

Payment Data Systems' new payment processing solution partnered with Secure Cash Network, marries the stored value debit card and its extensive debit network with the electronic payment and settlement connections of Payment Data Systems, Inc. to traditional billers. In the event a biller cannot accept electronic payments, Payment Data Systems allows for bill payment by unbanked consumers using its own check-writing capabilities.

The unique new bill payment functionality, which works equally well for all banked customers, will be added to Secure Cash Network's card products currently marketed under the brand name, "Secure Cash Payday" for employer payroll applications and "Pronto Banco" for retail applications. The new features added by the Payment Data Systems patent introduce capabilities for unbanked consumers using Secure Cash Network debit or ATM cards to pay bills, shop at millions of retail locations, access cash though ATMs and access and transfer funds internationally. Additional products will be developed to further meet the needs of employers, banked and unbanked consumers.

Initial target markets for the Secure Cash Network card, utilizing Payment Data Systems patented payment solutions technology include 3,000 retail/service outlets located in Texas and west into Southern California with broader and rapid expansion plans to follow.

Greg Bloh, President and CEO of Secure Cash Network said, "We are thrilled to be engaged with Payment Data Systems, Inc., a proven leader in the electronic payment industry. Adding the bill payment functionality to our existing brands supports our mission and brand development strategy to become the premier financial services solutions provider to the unbanked consumer market."

"The Convenience Store industry has become the trade channel of choice for unbanked consumers. Adding bill payment to our suite of card-based services will add additional value to consumers while creating a new profit opportunity for our retail partners," states Tony Muscarello, Executive Vice President of Secure Cash Network and former Chairman of the National Association of Convenience Stores Supplier Board.

About Payment Data Systems, Inc.

Payment Data Systems, Inc., is an Integrated Payments Solution Provider delivering comprehensive, cost-effective solutions to billers and retailers for the processing and management of electronic payments via the Internet, point of sale, or payments taken by Customer Service Representatives or an Interactive Voice Response (IVR).

Payment Data Systems' electronic payment processing solutions can be implemented more quickly and less expensively than alternative solutions because PDS allows for a full range of payment processing capabilities using a single, comprehensive storage retrieval system that allows for consolidated tracking and reporting of all payment types, regardless of source or channel. These service offerings include: one time and recurring ACH debits and credits, ACH lockbox and RCK services, Web pay acceptance of credit cards and checks, telephone pay to Customer Service Representatives for acceptance of credit cards and checks, Interactive Voice Response systems which completely automate the payment receiving process, and data warehousing that enable the storage and retrieval of all payment history from one location.

For additional information, visit www.paymentdata.com . Investor information can be found at: www.otcfn.com/pyds .

About Secure Cash Network, Inc.

Secure Cash Network, Inc. is a Consumer Products and Financial Services company specializing in Stored-Value Debit/ATM products for unbanked consumers. Secure Cash Network, Inc. offers several pre-paid card products including Secure Cash Payday and Pronto Banco. These products are sold through retail channels or issued through employers as payroll cards. For additional information visit www.securecashnetwork.com .

Contact: Geoffrey Eiten, Investor Relations, OTC Financial Network, (781) 444-6100 ext. 613.

With the exception of historical information contained in this release, this release includes forward-looking statements made under the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements.

--------------------------------------------------------------------------------
Source: Payment Data Systems, Inc.
###