ECHO Integrates Check Conversion With Check Verification, Debit, and Credit Card Transactions

Business Wire, Jan 22, 2001

Business Editors

AGOURA HILLS, Calif.--(BUSINESS WIRE)--Jan. 22, 2001

Electronic Clearing House Inc. (Nasdaq:ECHO) announced the completion of an integrated platform, referred to as ECHOTERM 3200, for check verification, check conversion, debit and credit card transactions through VeriFone's easy-to-use Omni 3200 terminal.

This is one of the first terminal applications available in the market today that includes check conversion and captures check images with a scanner.

The electronic check conversion (ECC) process greatly reduces the cost, time, and risks associated with check acceptance at the point-of-sale and works as follows:

-- The customer presents a paper check at the point-of-sale.

-- The check is fed through a check reader where the magnetic ink character
recognition (MICR) information is captured and the check image is stored. The
amount of the check is then entered by hand on a terminal keypad.

-- The information is then electronically routed to Rocky Mountain Retail
Systems Inc. (RMRS), the check verification subsidiary of ECHO, in Boulder,
Colo. At RMRS, the check writer's account information will be verified through
RMRS's National Check Information Service (NCIS) database, one of the nation's
largest check verification databases. Should the NCIS database identify a bad
check writer, the transaction will be immediately declined.

-- If the check is accepted, an authorization slip is printed for the check
writer to sign allowing the paper check to be immediately converted into an
electronic transaction. The check is then returned to the consumer stamped
"void".

-- The transaction data is routed to XPRESSCHEX Inc., ECHO's check processing
subsidiary in Albuquerque, N.M. XPRESSCHEX processes the transactions through
the Federal Reserve's Automated Clearing House (ACH) settlement system where
funds are debited directly from the check writer's checking account within 24
hours and credited to the merchant's account shortly thereafter.

-- Automatic re-submission of returned checks is provided and can be scheduled
to process near normal paydays when the check writer is more likely to have
adequate funds.

-- The merchant has the capability to access their check images online, all
their check transaction activity as well as review all credit card and debit
card activity in one location on the Internet.

The new terminal and its applications will be offered to all ECHO merchants and marketed through ECHO's various sales channels.

"Merchants want to simplify their processing systems and combining all these services on one platform meets that need," stated Joel Barry, CEO of ECHO. "Internet-based image retrieval, collection activity, and full transaction reporting will simplify the merchant's need to stay informed as to the status of his various payment methods."

Electronic Clearing House Inc. provides credit card processing, check guarantee, check verification, check conversion, inventory tracking and/or various Internet services to over 58,000 retail merchants and U-Haul dealers across the nation.

ECHO also designs, develops and integrates software and point-of-sale hardware that is utilized as credit card processing terminals, automated money order dispensers, and inventory tracking devices.

To take advantage of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, you are hereby cautioned that this release contains forward-looking statements that are based upon current expectations and involve a number of risks and uncertainties. Actual operations and results may differ materially from those expressed in the forward-looking statements made by the company.