TSYS Takes Leap into Prepaid Arena
TSYS to Buy Equity Position in Prepaid Technologies, L.L.C.
Columbus, Ga., September 23, 1999 - Total System Services, Inc.® (TSYS®) (NYSE: "TSS") today announced an agreement to purchase a 40 percent equity position in Prepaid Technologies, LLC, a Birmingham, Al.-based product development and sales company for stored value cards. The equity position will enable TSYS to broaden the reach of its products and services to markets it doesn’t serve today to include restaurants, employers, and other businesses. TSYS has the option to buy a greater position in the company at a future date.
According to the terms of the agreement, TSYS and Prepaid Technologies will jointly market Visa- and MasterCard-branded prepaid card products, beginning with prepaid payroll cards, to TSYS clients, other financial institutions and companies interested in reducing expenses associated with checks. In addition, TSYS will process the transactions for these cards. TSYS’ investment in Prepaid Technologies is subject to regulatory approval.
"Prepaid Technologies offers cutting-edge card solutions that help financial institutions, retailers and employers reduce expenses or tap into new revenue streams by offering prepaid card products in demand by today’s consumers," said TSYS President Philip W. Tomlinson. "This partnership further reinforces TSYS’ commitment to expand into new markets and technologies that leverage our core competency of providing state-of-the-art transaction processing solutions to companies around the world," he added.
"Prepaid Technologies is excited to provide an avenue for the newly developed stored value cards by joining with Total System Services to utilize its processing expertise, international reputation and extensive customer base. We foresee significant market growth and fee generation opportunities in this emerging field and are teaming with the very best to accomplish our goals," says Thomas M. McCulley, Chairman and CEO of Prepaid Technologies.
The prepaid cards, marketed as IN® cards, are stored value cards utilizing existing magnetic stripe technology and current bank processing systems to create fully electronic, low-cost transactions. Used as a credit or a debit card, these cards access the purchasing power offered by the Visa or MasterCard brand, access cash through existing ATM networks and provide low-cost long distance service for the cardholder.
Targeted markets for prepaid cards include expense cards, gift cards, incentive cards and payroll cards. Prepaid payroll cards target the "unbanked" consumers (those individuals with no formal relationship with a bank or financial institution to include checking accounts, savings, etc.) who need a safer and better method of receiving their payroll. According to industry sources, there will be an estimated 750 million gift cards by 2006, and data suggests the market potential for other prepaid cards is just as promising.
Prepaid Technologies is a company founded by banking and phone executives focused exclusively on the development and marketing of new stored value card solutions for the Financial Services and Retail Industries. Prepaid Technologies has developed a complete line of stored value cards from prepaid phone cards to Visa- and MasterCard-branded cards used for payroll/payments, incentives, gift cards, travel, college and more. Stored value cards are emerging as the next wave of significant fee revenue opportunities for financial institutions as well as providing bottom-line benefits to retailers for gift/refund cards. Further, they will significantly move the unbanked into the financial mainstream as a check substitute offered by employers and government entities. For more information, visit the company’s web site at www.in-prepaid.com.
TSYS is one of the world’s leading information technology processors of data, transactions and payments for domestic and international issuers of credit, debit, commercial and private-label cards. TSYS’ sophisticated systems offer online accounting, data processing, electronic commerce services, portfolio management, account acquisition, credit evaluation, risk management and customer service. Through our family of companies, TSYS services the entire lifecycle of card accounts and processes more than 194.6 million accounts, making it possible for an estimated 272 million cardholders to use their cards any time, anywhere. Headquartered in Columbus, Ga., TSYS (www.totalsystem.com) is an 80.8 percent owned subsidiary of Synovus Financial Corp. (NYSE: "SNV") (www.synovus.com) named the Best Company to Work for in America by FORTUNE magazine.
Contacts:
Becky Roberts
Online Communications Manager
ph. (706) 641-3839
broberts@totalsystem.com
Danita Gibson-Lloyd
Corporate Communications Manager
ph. (706) 649-5578
dglloyd@totalsystem.com