Accounts Receivable Conversion ARC Check 21 Solution Electronic

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

Industry Facts § There 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 § 1 Introduced in April 2002, ARC transactions totaled 24 million equaling $4. 71 billion § 2 Almost 5% of all transactions processed through the ACH Network in 2002 were ARC transactions 1 § 18, 982, 484 ARC transactions in 1 st Qtr 2003, a 152. 45% increase over 4 th Qtr 2002 2 1 Source: 2 Source: Global Concepts 2002 – The Future of Accounts Receivable Conversion by David Stewart. NACHA – The Electronic Payments Association. 2

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 3

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

EFT Network’s ARC / Check 21 Solution

ARC / Check 21 Solution 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 6

Key Features § 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 7

Technology Behind ARC / Check 21 Solution

Imaging Technology Imaging technology using multiple types of check imaging scanners linked to a Web based system allows you to scan checks. Digital Check TS - 350 Accepts 100 checks at a time Processes 60 -80 checks per minute, + or – 3, 000 per day Images both sides of checks in one pass Digital-Check TS - 220 e 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 Digital Check TS - 350 Digital Check TS – 220 e Magtek Imager EFT Web Hosted Software 9

Scan. Transmit. Process. 1. Merchant receives checks for payment of goods and services Digital Check TS - 350 2. The checks are scanned using one of EFT Network’s imaging scanners Digital Check TS – 220 e Magtek Imager 10

Scan. Transmit. Process. 3. The checks are scanned and processed + via EFT Network’s high speed web hosted software and transmitted through the ACH Network 4. 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. Non-consumer Items Consumer Items 11

Scan. Transmit. Process. 5. 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. Consumers Bank Merchants Bank 6. Upload files into your in house accounts receivable system. 12

EFT Network Software

Web Browser § Go to your browser and access the web-site § Log onto www. redeposit. com § Select Customer Login on the left navigation 14

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

Benefits for, YOU § 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 18

Conclusion 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 19

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

Getting Started EFT Network, Inc. 245 Saw Mill River Road Hawthorn, NY 10532 Tel: 914. 747. 3222 Fax 914. 747. 7218 www. redeposit. com Contact: Alex Bacon, Vice President of Sales & Marketing E-mail: sales@redeposit. com 21