Payment Data Systems Inc. and Natalie Gulbis Announce the Launch of the Natalie Gulbis Gift MasterCard(R)

Payment Data Systems, Inc. (OTCBB:PYDS), an integrated electronic payments solutions provider, announced the Natalie Gulbis Gift MasterCard® is now available for purchase.

The 24-year-old Ms. Gulbis is one of the LPGA Tour's most popular players. The Sacramento, California native was named Golf Digest's Most Improved LPGA Player, finished sixth on the Money List, and was a contributing member of the victorious U.S. Solheim Cup Team in 2005. Over the past two seasons, Ms. Gulbis has recorded 16 top-10 finishes, including three top-5 finishes in 2006.

Ms. Gulbis, the 2007 Evian Masters Champion in Evian-les-Bains, France, will be joined on August 2nd August 5th by the worlds top women professional golfers at the Ricoh British Open to be played for the first time over the St. Andrews Old Course, the Home of Golf.

Ms. Gulbis is among the top five of Advertising Ages most marketable young athletes, pens a popular online diary on her personal website, has started the third season of her Golf Channel reality television show, will release her 5th calendar in 2008, and is a featured character in a Tiger Woods video game.

Natalie Gulbis said, I am thrilled to be associated with Payment Data Systems and MasterCard. The card program we have developed is a perfect gift for golfers and is an excellent product addition for any golf pro shop or retailer. It makes for a unique golf tournament award and giveaway. The ability to have a printed gift message on the card is my favorite feature.

Louis Hoch, President and COO of Payment Data Systems, said, We are very pleased to provide Ms. Gulbis her own card program. By virtue of her excellent golf credentials and charismatic persona, she clearly represents the young, successful, and talented demographic we are trying to reach.

Customers will be able to choose from a series of card designs featuring Natalie Gulbis.

Initially, the cards can be purchased online at http://www.nataliecard.com. Later this year, we will be opening up retail channels through pro shops and golf specialty stores.

The Natalie Gulbis Gift MasterCard is issued by MetaBank pursuant to a license by MasterCard International.

The Natalie Gulbis Gift MasterCard is marketed and administered by Payment Data Systems, Inc. For updates, please see http://www.nataliecard.com.

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.

Payment Data is the owner of the electronic bill payment portal, http://www.billx.com, which has the ability to transmit payments to thousands of national billers.

Payment Data Systems, Inc. (OTCBB:PYDS) is a registered ISO/MSP of MetaBank and ISO/MSP/TPS/TPP of Merrick Bank Corp., South Jordan, UT.

Payment Data is a Level One PCI compliant Third Party Servicer.

Payment Datas intellectual property includes U.S. Patent Number 7,021,530 that relates to bill payments made with debit and stored value cards.

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

About MetaBank

MetaBank is a federally chartered savings bank headquartered in Storm Lake, Iowa. Meta Financial Group, Inc.® is the bank holding company for MetaBank, MetaBank West Central, Meta Payment Systems®, and Meta Trust Company®. The Meta Payment Systems division of MetaBank based in Sioux Falls, South Dakota, serves banks, processors, and third party marketers by providing prepaid cards, credit cards, ACH origination, merchant acquiring, ATM sponsorship, and money transfer. Meta Financial Group is traded on the NASDAQ Global Market: CASH (NASDAQ:CASH). For more information call 605-275-8052 or visit http://www.metacash.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 managements 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.

Contacts:

Payment Data Systems, Inc., San Antonio
Michael Long, 210-249-4040
ir@paymentdata.com
www.paymentdata.com

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