Payment Data Systems, Inc. Announces Fourth Winner of Carmen Electra Sweepstakes
     

San Antonio, TX September 17, 2007 Payment Data Systems, Inc. (OTCBB: PYDS), an integrated electronic payments solutions provider, announced today that Mr. Alvin Ping Ligh of La Mirada, CA won the fourth and final quarterly drawing for the "Electrafy Yourself" sweepstakes for Carmen Electra Prepaid MasterCard® and Carmen Electra Gift MasterCard® cardholders.

The yearlong quarterly sweepstakes has awarded $1,000 to four lucky entrants who entered the sweepstakes or acquired and used a Carmen Electra Prepaid MasterCard and/or Carmen Electra Gift MasterCard.

In addition to winning $1,000, Mr. Ligh is now qualified for our Grand Prize drawing to be held after October 31, 2007 for a chance to win a trip to an exclusive cardholder event with Carmen Electra.

In a random drawing, Mr. Ligh was selected from among the qualified entrants.

Payment Data Systems' President and COO Louis Hoch said, "It was very exciting to be able to announce to Mr. Ligh his selection as the final quarterly winner. We have been very enthusiastic about the response to the contest and we are looking forward to selecting the Grand Prize winner later this year."

In addition to the convenience of being accepted everywhere Debit MasterCard is accepted, the Carmen Electra Prepaid MasterCard and Carmen Electra Gift MasterCard feature special offers exclusive to cardholders. Customers can choose from a series of card designs featuring Carmen Electra. The cards can be purchased online at http://www.carmencard.com and at http://www.electragift.com.

The Carmen Electra Prepaid MasterCard and the Carmen Electra Gift MasterCard are issued by MetaBank pursuant to license by MasterCard International Incorporated.

The Carmen Electra Prepaid MasterCard and the Carmen Electra Gift MasterCard are marketed and administered by Payment Data Systems Inc.
 

About Payment Data Systems, Inc.

Payment Data Systems, Inc. is an integrated provider of world class electronic payment solutions to merchants, billers, banks, service bureaus, and credit and stored-value card issuers. PDS specifically tailored solutions manage critical points along the full spectrum of the transactional chain, ranging from card issuance to payment acceptance to electronic bill payment.

Payment Data is the owner of the electronic bill payment portal, http://www.billx.com, which has the ability to transmit payments to thousands of national billers.

Payment Data holds the exclusive license to market the Natalie Gulbis Gift MasterCard (www.nataliemastercard.com), the Carmen Electra Gift MasterCard (www.electragift.com) and the Carmen Electra Prepaid MasterCard (www.carmencard.com).

Payment Data Systems Inc. (OTCBB: PYDS) is a registered ISO/MSP of MetaBank and a registered ISO/MSP and TPS/TPP of Merrick Bank Corp., South Jordan, UT.

Payment Data is a Level One PCI compliant Third Party Servicer.

Payment Data's intellectual property includes U.S. Patent Number 7,021,530 that relates to bill payments made with debit and stored value cards.

For additional information, visit www.paymentdata.com. Contact Michael Long for Investor Relations information at 210.249.4040 or email at ir@paymentdata.com.
 
Payment Data Systems, Inc.
Michael Long
Chairman and CEO
phone: 210-249-4040
 
  
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