As part of the agreement, PDS will also have non- exclusive marketing and distribution rights to the Debit Card Load Kiosk (DCL-K) that has been designed and is being delivered by Thalassa. Seventy-five of these very sophisticated and value- based units have already been scheduled for likely installation later this year. Features of the Kiosk include a magnetic card reader, Las Vegas-class currency acceptor, a touch screen LCD interface, remote web monitoring and management, and customizable capabilities such as card dispensing, and wireless communication.

"The Thalassa executive team, led by Mike Gibbons, President and CEO, is very well positioned with relationships in the industry segments that we believe we can assist the most and deliver the greatest value to the customer." said Michael Long, Chairman and CEO. Long continued, "Examples of a few of these industry segments include higher education, secondary education, staffing, engineering, and manufacturing. I have had the opportunity to work with Mike for some time now and I am impressed with the quality and realization of client sources he has provided as well as his team's ability to understand PDS' products and value propositions and then effectively communicate those products and values to prospective clients. I am convinced this relationship will be a long-term and mutually valuable one."

Mike Gibbons, Thalassa's President and CEO, stated that, "We clearly recognize the comprehensive value proposition we can offer our customers by partnering with Payment Data Systems. We look forward to working with the PDS team to further accelerate their impressive growth. We've empirically proven that we are able to engage customers more efficiently and establish a competitive differentiation by providing a full spectrum of services including an easy, reliable and secure system to dispense and reload debit cards.

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). Additional products available from PDS include services and products that can be implemented more quickly and less expensively than the alternative of adding multiple payments companies as these solutions offer a full range of payment processing capabilities. These service offerings include: one time and recurring ACH debits and credits, electronic lockbox and returned check 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. Payment Data is the owner of the electronic bill payment portal, http://www.billx.com . billx.com has the ability to transmit electronic payments to thousands of national billers. For additional information, visit www.paymentdata.com.

About Thalassa Financial Services

Thalassa Financial Services, offers a comprehensive suite of value added turnkey financial solutions. Thalassa's fully integrated product offering provides multi-functional stored value kiosks, stored value cards and payroll debit cards to a broad variety of businesses and educational institutions. Thalassa, a privately held company based in Houston, Texas, is a recognized pioneer in developing and deploying Debit Card Loader Kiosks. Contact: Mike Gibbons, President and CEO, Thalassa Financial Services, Inc. 832-567-2745.