Copyright © 2005 EFT Network, Inc. All Rights Reserved. Electronic Check Processing and Deposit Accounts Receivable Conversion (ARC) / Check 21 Solution

 Increase efficiency by alleviating time consuming processes  Modify antiquated filing systems  Quicker access to receivables  Consolidation of accounting for multiple locations Business Challenges  Checks deposited faster  Sale tool for reselling  As part of a front-end RCK System for potential clients  Drastically reduces transaction fees Business Opportunities 1

 There are an estimated 14 billion check remittances each year 1  “Win-Win" innovation. Consumers have more protections and receive more information than when their checks are processed in a traditional manner, and businesses and financial institution can collect checks more cost effectively  Introduced in April 2002, ARC transactions totaled 24 million equaling $4.71 billion 1 1  Almost 5% of all transactions processed through the ACH Network in 2002 were ARC transactions 2  18,982,484 ARC transactions in 1 st Qtr 2003, a % increase over 4 th Qtr Source: Global Concepts 2002 – The Future of Accounts Receivable Conversion by David Stewart. 2 Source: NACHA – The Electronic Payments Association. Industry Facts 2

3 Understanding Check 21 What is Check 21? - Check 21 provides a Retailer/Merchant or Biller with the opportunity to convert any type of paper check, for purposes of transiting it electronically, where it may re-emerge in the bank clearing system as the legal equivalent of the original check through a substitute check document known as an Image Replacement Document or IRD. - It is applicable to ANY type of Check or instrument with a MICR* line *Magnetic Ink Characters at bottom of every check - It does not require permission or notification of any kind - IRD must meet certain formatting requirements

2 Consumer Consumer writes a check for $100 Consumer Check Check is issued to Joey’s Pizzeria Merchant Merchant deposits $100 check into their Chase Bank account Merchants Bank CHASE In return, FRB gives Chase $100 Citibank verifies if funds are available in Consumers account Consumers Bank CITIBANK FRB routes check to Consumers account at Citibank for processing Consumer receives check in statement Funds are available and Citibank debits $100 from Consumers account to give to FRB Chase routes check to FRB FEDERAL RESERVE BANK (FRB) Provides funding to Banks Provides check transport system by planes, trains & trucks Check Clearing Process

EFT Network’s ARC / Check 21 Solution

ARC / Check 21 Solution 6 EFT Network’s Accounts Receivable Conversion (ARC) / Check 21 Solution in conjunction with our superior Image Replacement Document (IRD) technology, is a premier single point of entry system that processes and deposits any type of paper check received via U.S. Mail or at payment locations, deposited as electronic transactions.  Processes thousands of checks per day with deposits credited into your bank account within 24 to 48 hours  Built on a flexible, web based infrastructure allowing easy integration to our various types of imaging scanners  Seamlessly capture accurate check images and MICR data information that automatically appears in the data entry fields  Manage your business transactions online, 24/7  Upload and import files into your data processing or accounts receivable system

 Submit checks and transfer funds electronically anywhere, anytime, anyplace  24/7 access to retrieve check images and authorization via our secure website  Real-time verification database reduces risk of accepting bad checks and collection costs  Upload files to update your in-house accounts receivable system  Checks received through any remote or branch office/store locations can be deposited through one banking institution/account, simplifying bank reconciliation processes  Alleviate a trip to the Bank  No Bank deposit fees  Save space and money – No need to store paper checks or deposit slips Key Features 7

Technology Behind ARC / Check 21 Solution

Imaging technology using multiple types of check imaging scanners linked to a Web based system allows you to scan checks. Digital Check TS Accepts 100 checks at a time -Processes checks per minute, + or – 3,000 per day -Images both sides of checks in one pass Digital-Check TS - 220e -Accepts 25 checks at at time -Processes 45 checks per minute, + or – 500 per day -Images both sides checks in one pass Magtek Imager -Accepts 1 check at at time -Processes + or - 30 checks per day -Images both sides checks in two passes Imaging Technology 9 Digital Check TS Digital Check TS – 220e Magtek Imager EFT Web Hosted Software

Merchant receives checks for payment of goods and services Scan. Transmit. Process The checks are scanned using one of EFT Network’s imaging scanners Digital Check TS Digital Check TS – 220e Magtek Imager

Consumer Items Non-consumer Items ACH Network 11 The checks are scanned and processed via EFT Network’s high speed web hosted software and transmitted through the ACH. The EFT Network system automatically distinguishes and converts Consumer items, processed as ACH items with Non consumer items including corporate checks and payroll checks into Check 21 IRDs Scan. Transmit. Process.

12 EFT Network electronically debits funds from the customers account and deposits funds in Merchants bank account. Funds are available within 24 to 48 hours, alleviating a trip to the bank. 5. Consumers Bank Merchants Bank Upload files into your in house accounts receivable system. 6. Scan. Transmit. Process.

EFT Network Software

 Go to your browser and access the web-site  Log onto  Select Customer Login on the left navigation Web Browser 14

 Enter your customer information all in uppercase letters. -File Code -User Name -Password  Select OK Customer Login 15

Welcome Page  Here you can access: -Transaction cut-off times -Notification of results status -Customer Survey & Daily Messages  Select ARC System on the left hand screen to get started 16

Main Menu  The Main Menu supplies you with all options available in our ARC System  Select Scan Checks to begin processing checks 17

 Process all checks electronically  Easy-to-use solution, requiring only a check scanner and internet access  Centralized Bank deposits for multiple company locations  Reduce Bank transaction return fees  Upload and import files to update your in-house accounts receivable system  Recover your returned items as quickly and cost - effectively as possible  NSF Checks will be reported within three (3) business days Merchant can redeposit immediately and keep all fees Benefits for, YOU 18

Accounts Receivable Conversion (ARC) / Check 21 Solution in conjunction with our superior Image Replacement Document (IRD) technology provides:  Easy-to-use solution, requiring only a check scanner and internet access  24/7 access to retrieve check images and authorization via our secure website  Concise, real time reporting available on-line  Real-time verification database reduces risk of accepting bad checks and collection costs  No Bank deposit fees  Files to update your in-house accounts receivable system Conclusion 19

20 EFT Network, Inc. is Committed to Providing Superior, Affordable, ACH and Check Processing Solutions

21 EFT Network, Inc. 245 Saw Mill River Road Hawthorn, NY Tel: Fax Contact: Alex Bacon, Vice President of Sales & Marketing Getting Started