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NEW STUDY SHOWS STRONG DEMAND FOR DEBIT AND BUSINESS INFORMATION TRANSACTIONS AT THE POINT OF SALE

 NEW STUDY SHOWS STRONG DEMAND FOR DEBIT
 AND BUSINESS INFORMATION TRANSACTIONS AT THE POINT OF SALE
 ORLANDO, Fla., Sept. 16 /PRNewswire/ -- VeriFone Inc. (NASDAQ: VFIC) today announced the results of an independent study that indicate substantial growth opportunities for card-based transaction acquirers in the retail payment processing market.
 The 50 executives surveyed expressed optimism about the future of the acquirer services industry, despite the pressures of increased competition, growing technological complexity and constantly changing bankcard association regulations. Those surveyed believe that higher transaction volumes will drive the expansion of the industry, as more merchants add debit and business information applications such as cash management, electronic data interchange and customer demographics.
 Sponsored by VeriFone, and conducted by Payment Systems Inc. (PSI) and Martaus and Associates, the study surveyed merchant banks, third- party processors, independent sales organizations, and other acquirers of card-based transactions on issues perceived to have the greatest impact on the growth and profitability of their businesses. The study was conducted in two phases. The first phase consisted of initial telephone and in-person interviews with more than 50 industry executives; the second phase involved telephone follow-up surveys with 30 of the original respondents.
 System Upgrades Needed to Keep Up With Changes
 "The study suggests that despite the high percentage of authorization-only and electronic data capture terminals in the installed base, the retail payment processing market for Transaction Automation systems is far from saturated," said Penny Tipre, director of industry marketing at VeriFone. "Service providers will need to continue to upgrade their existing systems to more function-rich systems to keep abreast of the changes occurring in the industry."
 The study findings were presented to VeriFone customers and industry partners in "Addressing the Challenges in Providing Acquirer Services," a symposium hosted by VeriFone on Sept. 16, 1992, following the American Bankers Association's 21st National Bank Card Conference in Orlando.
 Summary of Key Findings
 Although a wide range of subjects were addressed in the study, the executives interviewed identified the following issues as key to continuing expansion of their businesses.
 -- Increased competition for point-of-sale transactions from non- banks, as a growing number of banks are getting out of the merchant services business.
 -- Strain on industry service providers caused by the need to comply with constant changes in bankcard association regulations.
 -- Growing demand for integration of debit and credit at the point of sale.
 -- Increased merchant demand for cash management, inventory, customer demographics and other business information at the point of sale.
 -- Limited ability of the installed terminal base to handle additional and more complex transactions at the point of sale.
 -- Reluctance of bank senior management to commit fully to the transaction acquiring side of the business.
 All the executives who responded to the study have integrated or plan to integrate debit into their service offerings. The majority felt that the ability to provide both payment-related and customer-related information to merchants will be the key to profitability in the 1990s.
 The respondents also evaluated the impact of emerging technologies -- such as electronic signature capture, watermark magnetics, smart cards and image processing. A majority felt that these technologies are unlikely to be adopted in the near future, citing a lack of competitive pressure and little evidence that their adoption would result in bottom-line improvements for their businesses.
 Future Studies Planned
 "The study was a unique opportunity for VeriFone to gain greater knowledge of the challenges facing our customers in the acquirer services industry," Tipre said. "We plan to conduct ongoing research and analysis of this kind in order to serve as a catalyst for future industry initiatives, and to better gauge the product and service requirements of our customers."
 The Company
 VeriFone Inc., based in Redwood City, Calif., is a leading global supplier of Transaction Automation systems used to deliver payment processing and other transaction services to the retail, healthcare and government markets. The company has more than 30 facilities -- including regional offices, development centers, and manufacturing and distribution centers -- located throughout the United States and in or near Frankfurt; London; Madrid; Paris; Singapore; Sydney; Taipei and Kaohsiung, Taiwan, R.O.C.; and Bangalore, India. To date, VeriFone has shipped more than 2.4 million Transaction Automation systems, which have been installed in nearly 70 countries. The company's 1991 revenues totaled $187.9 million. VeriFone was named one of America's 100 fastest-growing companies by Fortune and one of the 200 best small companies by Forbes.
 -0- 9/16/92
 /CONTACT: Tod Bottari of VeriFone, 415-598-5570; or Jane Gideon of Wilson McHenry Company, 415-592-7600, for VeriFone/
 (VFIC) CO: VeriFone, Inc. ST: California, Florida IN: FIN SU:


TB -- SJ004 -- 0151 09/16/92 13:00 EDT
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Date:Sep 16, 1992
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