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Discover Financial Services Announces Agreement With First Data to Issue Discover Network Payroll Cards By Money Network

June 11, 2007

Discover Financial Services, a business unit of Morgan Stanley (NYSE:MS), announced an agreement with First Data Corp. (NYSE:FDC), to issue Discover Network payroll cards provided by Money Network Financial, LLC, a First Data Company. Money Network will issue Discover Network branded payroll cards and handle card administration.

The Discover Network payroll card by Money Network program provides a smart alternative to paper paychecks including card applications typically not offered by other prepaid card brands. The payroll cards offer underbanked consumers diverse financial management tools including instant-issue prepaid debit card use, check writing capabilities via Money Network™ Checks, access to a large network of ATMs, direct deposit and pay-to-the-penny payroll services, and money transfers from the United States to Mexico and Latin America.

With instant-issuing capabilities, employers can issue Discover Network branded cards to employees who may not have traditional banking relationships. This feature also is beneficial when delivering bonuses, commissions and special incentives. Discover Network payroll cards provide a 100 percent authorization requirement, which further reduces fraud risks and costs for issuers. In addition to the convenience of immediate access to funds, Discover Network payroll cardholders can check account balances in the authorization messages on their sales receipts after every signature-based purchase.

“Companies are quickly realizing that payroll card programs are a safe, convenient and cost-effective way for both employers and employees to significantly reduce the costs associated with the payroll process,” said Tom Crowder, director of strategic development and general manager of prepaid products for Discover Financial Services. “Through our agreement with Money Network, Discover Network can further extend its reach into the rapidly growing payroll card market. We also are strengthening our relationship with First Data, which already offers Discover Network card acceptance as part of its integrated service to small- and medium-sized merchants.”

According to the American Payroll Association, it costs between $1 and $2 to process, print and deliver a single paycheck and about $9 to replace it. Additional expenses often include postage or courier fees to distribute paychecks, as well as the cost of tracking and accounting for paychecks once they’re issued.

The Discover Network payroll card program helps significantly reduce these costs by automatically loading funds onto cards issued to each employee which can then be used anywhere Discover Network cards are accepted. Eliminating paper checks minimizes employers’ exposure to check fraud and removes bank-processing fees for stop payments on lost or stolen checks.

Employees see significant financial benefits as well. While it can cost anywhere from 2 percent to 10 percent of the check’s value for an employee without access to a bank account to cash a payroll check, Discover Network’s payroll card only carries a nominal fee. In addition, employees can access funds immediately every payday, track their payroll information and pay bills online via a secure Web site, as well as use their cards to make purchases everywhere Discover Network cards are accepted.

“Administering payroll can be costly for any company,” said Money Network President, Mark Herrington. “Our agreement to issue Discover Network payroll cards is just another step we are taking to help reduce the expense burden for companies and their workers by offering a solution that provides a safe, secure, and simple alternative for managing their hard-earned money. The Discover Network payroll card by Money Network program allows us to expand our reach and help meet our employer/employee payroll objectives.”

Discover Network is a comprehensive and secure payments network that supports a full range of credit, debit, and prepaid cards, including the Discover Card. Discover Network also provides customer-centric tools and programs designed to help issuers, acquirers, and merchants drive loyalty, increase transaction volume, and run their business more effectively, with streamlined efficiencies. Discover Network’s straightforward, collaborative, “roll-up-your sleeves” approach combined with its brand-driven economics provides a fresh new brand choice for issuers, acquirers and merchants who want to reach more customers.

About Discover Financial Services

Discover Financial Services, a business unit of Morgan Stanley (NYSE:MS), operates the Discover Card with more than 50 million cardmembers, and the Discover Network with millions of merchant and cash access locations, through its subsidiary, DFS Services LLC. DFS Services also operates the PULSE ATM/debit network, which serves over 4,400 financial institutions and includes nearly 260,000 ATMs, as well as POS terminals nationwide. For more information, visit www.discovercard.com, www.discovernetwork.com or www.pulse-eft.com.

About First Data Corporation

First Data Corp. (NYSE:FDC) is a leading provider of electronic commerce and payment solutions for businesses worldwide. Serving over 5 million merchant locations, 1,900 card issuers and their customers, First Data powers the global economy by making it easy, fast and secure for people and businesses around the world to buy goods and services using virtually any form of payment. The company’s portfolio of services and solutions includes merchant transaction processing services; credit, debit, private-label, gift, payroll and other prepaid card offerings; fraud protection and authentication solutions; electronic check acceptance services through TeleCheck; as well as Internet commerce and mobile payment solutions. The company’s STAR Network offers PIN-secured debit acceptance at 2 million ATM and retail locations. For more information, visit www.firstdata.com.




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