Payment Data Systems CEO Provides Shareholder Business Recap and Outlook for 2009 – 2010

Business Wire, June 22, 2009

SAN ANTONIO -- Payment Data Systems, Inc. (OTC BB: PYDS), an integrated electronic payments solutions provider, today announced the availability of a letter to shareholders. Full text of the letter is available at: http://www.paymentdata.com/investor.htm.

In the letter to shareholders, Chairman and CEO Michael Long provides a recap of the events and progress of the company.

The letter also provides some perspective on the coming twelve months and the events that could develop and be announced.

Michael Long, CEO, said, "As we approach the sixth anniversary of the company, we thought it would helpful to review our progress to date and provide some perspective on the coming months."

About Payment Data Systems, Inc.

Payment Data Systems is an integrated payment solutions provider to merchants and billers. The organization provides an extensive set of products to deliver world-class payment acceptance. Payment Data has solutions for merchants, billers, banks, service bureaus and card issuers. The strength of the company is its ability to offer specifically tailored solutions for card issuance, payment acceptance and bill payments.

For additional information, visit www.paymentdata.com. Contact Michael Long for Investor Relations information at 210-249-4040 or email at ir@paymentdata.com.

FORWARD-LOOKING STATEMENTS DISCLAIMER

Except for the historical information contained herein, the matters discussed in this release include certain forward-looking statements, which are intended to be covered by safe harbors. Those statements include, but may not be limited to, all statements regarding our and management’s intent, belief and expectations, such as statements concerning our future and our operating and growth strategy. Investors are cautioned that all forward-looking statements involve risks and uncertainties including, without limitation, the factors detailed from time to time in our filings with the Securities and Exchange Commission. One or more of these factors have affected, and in the future could affect our businesses and financial results in the future and could cause actual results to differ materially from plans and projections. We believe that the assumptions underlying the forward-looking statements included in this release will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by us or any other person that our objectives and plans will be achieved.

All forward-looking statements made in this release are based on information presently available to our management. We assume no obligation to update any forward-looking statements, except as required by law.