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What changed in Paysign, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Paysign, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+214 added−212 removedSource: 10-K (2026-03-25) vs 10-K (2025-03-26)

Top changes in Paysign, Inc.'s 2025 10-K

214 paragraphs added · 212 removed · 174 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeJavelin predicts 8% annual growth from 2024 through 2027 with total open-loop loads projected to reach $836 billion by 2027. Consumers, both banked and unbanked, use prepaid cards such as general purpose reloadable (“GPR”) cards, to conduct their day-to-day financial transactions such as paying bills, depositing checks, and receiving direct deposits.
Biggest changeConsumers, both banked and unbanked, continue to increase their use of prepaid cards such as general purpose reloadable ("GPR") cards to conduct day-to-day financial transactions including paying bills, depositing checks, and receiving direct deposits. According to Javelin's 2025 North American Payments Insights survey, the use of open-loop reloadable cards grew significantly from 20% in 2024 to 27% in 2025.
Our Products and Services As a payment processor and prepaid card program manager, our payment solutions are utilized by our customers as a means to increase customer loyalty, increase brand recognition, reward customers, agents and employees while reducing administration costs and streamlining operations.
Our Products and Services As a payment processor and prepaid card program manager, our payment solutions are utilized by our customers as a means to increase customer loyalty, increase brand recognition and reward customers, agents and employees while reducing administration costs and streamlining operations.
Bank Regulations All of the cards that we service are issued by state-chartered banks. Thus, we are subject to the oversight of the regulators for, and certain laws applicable to, these card issuing banks.
Bank Regulations All the cards that we service are issued by state-chartered banks. Thus, we are subject to the oversight of the regulators for, and certain laws applicable to, these card issuing banks.
See "Risk Factors" for additional discussion regarding the potential impacts of changes in laws and regulations to which we are subject and failure to comply with existing or future laws and regulations. We continually monitor and enhance our compliance program to stay current with the most recent legal and regulatory changes.
See "Risk Factors" for additional discussion regarding the potential impacts of changes in laws and regulations to which we are subject and failure to comply with existing or future laws and regulations. 7 We continually monitor and enhance our compliance program to stay current with the most recent legal and regulatory changes.
In addition, we would be required to maintain "permissible investments" in an amount equivalent to all "outstanding payment obligations." Escheatment Laws Unclaimed property laws of every U.S. state require that certain information be tracked on card programs.
In addition, we would be required to maintain "permissible investments" in an amount equivalent to all "outstanding payment obligations." 8 Escheatment Laws Unclaimed property laws of every U.S. state require that certain information be tracked on card programs.
Even an unsuccessful challenge of our practices could cause adverse publicity and cause us to incur significant legal and related costs. 10 Privacy and Security Standards under HIPAA or Other Laws. HIPAA contains privacy regulations and security regulations that apply to some of our operations.
Even an unsuccessful challenge of our practices could cause adverse publicity and cause us to incur significant legal and related costs. Privacy and Security Standards under HIPAA or Other Laws. HIPAA contains privacy regulations and security regulations that apply to some of our operations.
ITEM 1. BUSINESS. Overview Paysign, Inc. (the “Company,” “Paysign,” “we” or “our”), headquartered in Nevada, was incorporated on August 24, 1995, and trades under the symbol PAYS on The Nasdaq Stock Market LLC. We are a vertically integrated provider of prepaid card products and processing services for corporate, consumer and government applications.
ITEM 1. BUSINESS. Overview Paysign, Inc. (the “Company,” “Paysign,” “we” or “our”), headquartered in Nevada, was incorporated on August 24, 1995, and trades under the symbol PAYS on The Nasdaq Stock Market LLC. We are a vertically integrated provider of prepaid card products and processing services for corporate, consumer and government entities.
We differentiate ourselves with this specific product by offering accelerated adjudication and payments relative to our competition. This results in providers having a stronger willingness to utilize our products versus our competitors. Debit Based Affordability Programs: We continue to utilize physical and virtual debit cards to address highly specific industry concerns related to patient affordability.
We differentiate ourselves with this specific product by offering accelerated adjudication and payments for medical claims relative to our competition. This results in providers having a stronger willingness to utilize our products versus our competitors. Debit Based Affordability Programs: We continue to utilize physical and virtual debit cards to address highly specific industry concerns related to patient affordability.
Source plasma is the plasma collected from individual donors that serves as the raw material for the further manufacture into these life saving therapies. In the past, source plasma donation centers compensated their donors with cash or check. Today, the predominant compensation means for donor payments is a prepaid card.
Source plasma is the plasma collected from individual donors that serves as the raw material for the further manufacture into these lifesaving therapies. In the past, source plasma donation centers compensated their donors with cash or check. Today, the predominant compensation means for donor payments is a prepaid card.
Prepaid cards have also proven to be an attractive alternative to traditional bank accounts for certain segments of the population, particularly those without, or who could not qualify for, a checking or savings account. Javelin Advisory Services 20 th Annual U.S.
Prepaid cards have also proven to be an attractive alternative to traditional bank accounts for certain segments of the population, particularly those without, or who could not qualify for, a checking or savings account. Javelin Advisory Services 22nd Annual U.S.
Open-loop, or network-branded, prepaid cards carry an acceptance mark of a national or international payment network such as Visa, Interlink, Plus, MasterCard, Maestro, Cirrus, Discover or Pulse and can be used anywhere that card brand is accepted.
Prepaid cards can either be open-loop, closed-loop, or restricted-loop. Open-loop, or network-branded, prepaid cards carry an acceptance mark of a national or international payment network such as Visa, Interlink, Plus, MasterCard, Maestro, Cirrus, Discover or Pulse and can be used anywhere that card brand is accepted.
These categories are consumer-funded, corporate-funded and government-funded. Consumer-Funded Programs: The consumer prepaid category consists of products such as GPR cards, gift cards, travel money cards, and remittance/peer-to-peer (“P2P”) cards. General Purpose Reloadable Cards: A type of prepaid card typically purchased by a consumer for his/her personal use to pay for purchases, pay bills and/or access cash at ATMs.
Consumer-Funded Programs: The consumer prepaid category consists of products such as GPR cards, gift cards, travel money cards, and remittance/peer-to-peer (“P2P”) cards. General Purpose Reloadable Cards: A type of prepaid card typically purchased by a consumer for his or her personal use to pay for purchases, pay bills and/or access cash at ATMs.
Our suite of product offerings includes solutions for corporate rewards, prepaid gift cards, general purpose reloadable debit cards, employee incentives, consumer rebates, donor compensation, clinical trials, healthcare reimbursement payments and pharmaceutical payment assistance, and demand deposit accounts accessible with a debit card. Our cards are sponsored by our issuing bank partners.
Our suite of product offerings includes solutions for corporate rewards, prepaid gift cards, general purpose reloadable debit cards, employee incentives, consumer rebates, donor compensation, clinical trials, healthcare reimbursement payments and pharmaceutical payment assistance, demand deposit accounts accessible with a debit card and software solutions targeting blood and plasma collection organizations. Our cards are sponsored by our issuing bank partners.
We are a direct processor of these claims and conduct adjudication on an internal proprietary platform specifically designed to address the needs of our clients and their unique business rules. Payments for processed claims are made directly to a healthcare provider using our virtual debit card products.
We are a direct processor of these claims and conduct adjudication on an internal proprietary platform specifically designed to address the needs of our clients and their unique business rules. Payments for processed claims are made directly to a healthcare provider using either checks or virtual debit cards.
The solution can be utilized either as a stand-alone web-based solution or integrated with existing donor management systems, giving plasma donation centers an increased level of flexibility. The Company entered the market in late 2011 and has seen significant growth in this market segment. Currently, the Company services approximately 39% of the plasma collection centers in the United States.
The solution can be utilized either as a stand-alone web-based solution or integrated with existing donor management systems, giving plasma donation centers an increased level of flexibility. The Company entered the market in late 2011 and has seen significant growth in this market segment.
We hire independent contractors on an as-needed basis, and we may retain additional employees and consultants during the next twelve months, including additional patient affordability, information technology, product and project management, fraud, and customer care personnel to support our growing businesses. 11 Available Information Our internet address is www.paysign.com.
We hire independent contractors on an as-needed basis, and we may retain additional employees and consultants during the next twelve months, including additional patient affordability, information technology, product and project management, fraud, and customer care personnel to support our growing businesses. Available Information Our internet address is www.paysign.com. Information on our website does not constitute part of this Annual Report.
To date, we have issued millions of prepaid cards under programs implemented for Fortune 500 companies, multinationals, as well as top pharmaceutical manufacturers, universities and social media companies. As of December 31, 2024, we had approximately 7.3 million cardholders participating in approximately 600 card programs.
To date, we have issued millions of prepaid cards under programs implemented for Fortune 500 companies, multinationals, as well as top pharmaceutical manufacturers, universities and social media companies. As of December 31, 2025, we had approximately 8.4 million cardholders participating in approximately 670 card programs.
Breakage is recorded ratably over the estimated card life based on historical redemption patterns, market-specific trends, escheatment rules and existing economic conditions and relates solely to our open-loop gift card business which began at the end of 2022.
Breakage is recorded ratably over the estimated card life based on historical redemption patterns, market-specific trends, escheatment rules and existing economic conditions and relates solely to our open-loop gift card business which began at the end of 2022. Settlement income is recorded at the expiration of the card or card program and relates primarily to our corporate incentive programs.
Employees and Independent Contractors As of December 31, 2024, we had approximately one hundred seventy-three employees and independent contractors. We have no collective bargaining agreements with our employees, and believe all independent contractor and employment agreement relationships are satisfactory.
Employees and Independent Contractors As of December 31, 2025, we had approximately two hundred twenty-six employees and independent contractors. We have no collective bargaining agreements with our employees and believe all independent contractor and employment agreement relationships are satisfactory.
Analysis of facts and circumstances of each card program under state unclaimed property laws determines whether funds under such programs are escheatable. 8 Privacy and Data Protection Regulation In the ordinary course of our business, we or our third-party service providers collect certain types of data, which subjects us to certain privacy and information security laws in the United States, including, for example, the Gramm-Leach-Bliley Act of 1999, and other laws or rules designed to regulate consumer information and mitigate identity theft.
Privacy and Data Protection Regulation In the ordinary course of our business, we or our third-party service providers collect certain types of data, which subjects us to certain privacy and information security laws in the United States, including, for example, the Gramm-Leach-Bliley Act of 1999, and other laws or rules designed to regulate consumer information and mitigate identity theft.
The Company offers a comprehensive customized payment solution for source plasma collection centers under the Paysign brand. The solution consists of the Paysign Plasma Donor Compensation Prepaid Card, the Paysign Partner Portal for administrators, and the Paysign Kiosk.
The Company provides a fully customized payment solution for source plasma collection centers under the Paysign brand. This offering includes the Paysign Plasma Donor Compensation Prepaid Card and the Paysign Partner Portal for administrators.
Any change in such regulation and oversight, whether in the form of restrictions on activities, regulatory policy, regulations, or legislation, including but not limited to changes in the regulations governing banks, could have a material impact on our operations. 6 Our products and services are generally subject to federal, state and local laws and regulations, including: · anti-money laundering and anti-bribery laws; · money transfer and payment instrument licensing regulations; · escheatment laws; · privacy and information safeguard laws; · data and personal information protection; · bank regulations; · consumer protection laws; · tax; · environmental sustainability (including climate change); · false claims laws and other fraud and abuse restrictions; and · privacy and security standards under the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) or other laws.
Our products and services are generally subject to federal, state and local laws and regulations, including: · anti-money laundering and anti-bribery laws; · money transfer and payment instrument licensing regulations; · escheatment laws; · privacy and information safeguard laws; · data and personal information protection; · bank regulations; · consumer protection laws; · tax; · environmental sustainability (including climate change); · false claims laws and other fraud and abuse restrictions; and · privacy and security standards under the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) or other laws.
Regulations Introduction We operate in a highly regulated environment and are subject to extensive regulation, supervision and examination. Applicable laws and regulations may change, and there is no assurance that such changes will not adversely affect our business.
As of December 31, 2025, we managed approximately 670 card programs with approximately 8.4 million participating cardholders. 6 Regulations Introduction We operate in a highly regulated environment and are subject to extensive regulation, supervision and examination. Applicable laws and regulations may change, and there is no assurance that such changes will not adversely affect our business.
In many cases, these state laws are not preempted by the HIPAA privacy regulations and may be subject to interpretation by various courts and other governmental authorities. Further, the U.S.
In addition, some states are considering new laws and regulations that further protect the confidentiality, privacy and security of medical records or other types of medical information. In many cases, these state laws are not preempted by the HIPAA privacy regulations and may be subject to interpretation by various courts and other governmental authorities. Further, the U.S.
Highly fragmented segments currently include financial account processing, customer relationship management solutions, electronic funds transfer and prepaid solutions. Many of our existing and potential competitors have longer operating histories, greater financial strength and more recognized brands in the industry. These competitors may be able to attract customers more easily because of their financial resources and awareness in the market.
Certain segments of the financial services and healthcare industries tend to be highly fragmented, with numerous companies competing for market share. Highly fragmented segments currently include financial account processing, customer relationship management solutions, electronic funds transfer and prepaid solutions. Many of our existing and potential competitors have longer operating histories, greater financial strength and more recognized brands in the industry.
The Company’s plasma solution also provides cardholders with a point-of-sale cash back rewards program, a pharmacy prescription discount card and a digital bank account which are all used to assist plasma donation centers in their efforts to maximize the donor experience. The solution offers customized reporting and provides a level of business analytics previously unavailable.
In addition, the plasma solution features a point-of-sale cash-back rewards program, a pharmacy prescription discount card and a digital banking account, all designed to help plasma donation centers enhance and optimize the donor experience. The solution offers customized reporting and provides a level of business analytics previously unavailable.
Our larger competitors can also devote substantially more resources to business development and may adopt more aggressive pricing policies. To compete with these companies, we rely primarily on direct marketing strategies including strategic marketing partners. Sales and Marketing We market our Paysign payment solutions through direct marketing by the Company’s sales team.
These competitors may be able to attract customers more easily because of their financial resources and awareness in the market. Our larger competitors can also devote substantially more resources to business development and may adopt more aggressive pricing policies. To compete with these companies, we rely primarily on direct marketing strategies including strategic marketing partners.
The Paysign Communications Suite To help maximize the cardholder experience, cardholders can access their card balances and transaction history, as well as other information as dictated by the program, such as an ATM locator, a loyalty point counter, and geo-specific messaging through a number of touchpoints such as the Paysign kiosk, the Paysign Mobile App, two-way SMS, text alerts and the Paysign cardholder web portal. 5 Technology Our technology platform employs a standard enterprise services bus in a service-oriented architecture, configured for 24/7/365 transaction processing and operations.
We believe our in-house customer service center provides the highest quality customer service experience for our clients as training is performed on-site by Paysign staff. 5 The Paysign Communications Suite To help maximize the cardholder experience, cardholders can access their card balances and transaction history, as well as other information as dictated by the program, such as an ATM locator, a loyalty point counter, and geo-specific messaging through a number of touchpoints such as the Paysign Mobile App, two-way SMS, text alerts and the Paysign cardholder web portal.
We also continue to implement policies and programs and to adapt our business practices and strategies to help us comply with current legal standards, as well as with new and changing legal requirements affecting particular services or the conduct of our business generally. 7 Anti-Money Laundering and Anti-Bribery Laws Our products and services are generally subject to federal anti-money laundering laws, including the Bank Secrecy Act, as amended by the USA PATRIOT Act, and similar state laws.
We also continue to implement policies and programs and to adapt our business practices and strategies to help us comply with current legal standards, as well as with new and changing legal requirements affecting particular services or the conduct of our business generally.
Open-Loop Prepaid Card Market Forecast, 2023-2027, shows that open-loop prepaid growth in the short-term is strong and forecasted to remain strong in the long-term. This forecast is led by strong anticipated growth in the cash access market, the largest open-loop market.
Open-Loop Prepaid Card Market Forecast, 2025-2029, shows that open-loop prepaid growth continues to demonstrate strong performance in both the short-term and long-term. The forecast is led by robust anticipated growth in the cash access market, which remains the largest open-loop segment.
If customer funds are unclaimed at the end of an applicable statutory abandonment period, the proceeds of the unclaimed property must be remitted to the appropriate state.
If customer funds are unclaimed at the end of an applicable statutory abandonment period, the proceeds of the unclaimed property must be remitted to the appropriate state. Analysis of facts and circumstances of each card program under state unclaimed property laws determines whether funds under such programs are escheatable.
Markets and Major Customers We have no major customers and are not reliant on any individual card program. We manage multiple card programs at any given time. As of December 31, 2024, we managed approximately 600 card programs with approximately 7.3 million participating cardholders.
Markets and Major Customers We have no major customers and are not reliant on any individual card program. We manage multiple card programs at any given time.
The Paysign platform provides IVR, SMS alerts and two-way SMS messaging, allowing cardholders to set alerts and check their balances and transaction history without the assistance of a live customer service operator. We believe our in-house customer service center provides the highest quality customer service experience for our clients as training is performed on-site by Paysign staff.
The Paysign platform provides IVR, SMS alerts and two-way SMS messaging, allowing cardholders to set alerts and check their balances and transaction history without the assistance of a live customer service operator.
Our payment solutions are utilized by our corporate customers as a means to increase customer loyalty, increase patient adherence rates, reduce administration costs and streamline operations. Public sector organizations can utilize our payment solutions to disburse public benefits or for internal payments. We market our prepaid card solutions under our Paysign® brand.
Our payment solutions are utilized by our corporate customers as a means to increase customer loyalty, increase patient adherence rates, reduce administration costs and streamline operations. We market our prepaid card solutions under our Paysign® brand. As we are a payment processor and prepaid card program manager, we derive our revenue from all stages of the prepaid card lifecycle.
Our primary market focus is on companies that require a streamlined payment solution for rewards, rebates, payment assistance, and other payments to their customers, employees, agents and others. To reach these markets, we focus our sales efforts on direct contact with our target market and attendance at various industry specific conferences.
Sales and Marketing We market our Paysign payment solutions through direct marketing by the Company’s sales team. Our primary market focus is on companies that require a streamlined payment solution for rewards, rebates, payment assistance, and other payments to their customers, employees, agents and others.
Prepaid cards are unlike debit cards that are attached to a personal or business checking account and draw funds from that linked account or a credit card that draws funds from a line of credit. Prepaid cards can either be open-loop, closed-loop, or restricted-loop.
What Are Prepaid Cards? A prepaid card is a payment product that is pre-funded and not directly linked to an individual bank account. Prepaid cards are unlike debit cards that are attached to a personal or business checking account and draw funds from that linked account or a credit card that draws funds from a line of credit.
We may, at times, utilize independent contractors who make direct sales and are paid on a commission basis only.
To reach these markets, we focus our sales efforts on direct contact with our target market and attendance at various industry specific conferences. We may, at times, utilize independent contractors who make direct sales and are paid on a commission basis only.
In addition to HIPAA, numerous other state and federal laws govern the collection, dissemination, use, access to and confidentiality of individually identifiable health information and healthcare provider information. In addition, some states are considering new laws and regulations that further protect the confidentiality, privacy and security of medical records or other types of medical information.
If we are unable to properly protect the privacy and security of health information entrusted to us, we could be subject to substantial penalties, damages and injunctive relief. 10 In addition to HIPAA, numerous other state and federal laws govern the collection, dissemination, use, access to and confidentiality of individually identifiable health information and healthcare provider information.
This distinctive positioning allows us to provide end-to-end technologies that securely manage transaction processing, cardholder enrollment, value loading, account management, data and analytics, and customer service. Our architecture is known for its cross-platform compatibility, flexibility, and scalability – allowing our clients and partners to leverage these advantages for cost savings and revenue opportunities.
Our architecture is known for its cross-platform compatibility, flexibility, and scalability – allowing our clients and partners to leverage these advantages for cost savings and revenue opportunities.
We compete with a variety of companies in our markets and our competitors vary in size, scope and breadth of products and services offered. Certain segments of the financial services and healthcare industries tend to be highly fragmented, with numerous companies competing for market share.
Competition The markets for financial products and services, including prepaid cards and services related thereto, are intensely competitive. We compete with a variety of companies in our markets and our competitors vary in size, scope and breadth of products and services offered.
We utilize two secure, interconnected, environmentally-controlled data centers, with emergency power generation capabilities, and fully redundant capabilities, and cloud hosting. We use a variety of proprietary and licensed standards-based technologies to implement our platforms, including those which provide for orchestration, interoperability and process control.
We use a variety of proprietary and licensed standards-based technologies to implement our platforms, including those which provide for orchestration, interoperability and process control. The platforms also integrate a data infrastructure to support both transaction processing and data warehousing for operational support and data analytics.
We cannot provide assurance regarding how these standards will be interpreted, enforced or applied to our operations. If we are unable to properly protect the privacy and security of health information entrusted to us, we could be subject to substantial penalties, damages and injunctive relief.
We cannot provide assurance regarding how these standards will be interpreted, enforced or applied to our operations.
As we are a payment processor and prepaid card program manager, we derive our revenue from all stages of the prepaid card lifecycle. We operate on a powerful, high-availability payments platform with cutting-edge fintech capabilities that can be seamlessly integrated with our clients’ systems.
We operate on a powerful, high-availability payment solutions platform with cutting-edge fintech capabilities that can be seamlessly integrated with our clients’ systems. This distinctive positioning allows us to provide end-to-end technologies that securely manage transaction processing, cardholder enrollment, value loading, account management, data and analytics and customer service.
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Settlement income is recorded at the expiration of the card program and relates predominantly to our pharma prepaid business which ended in 2022. What Are Prepaid Cards? A prepaid card is a payment product that is pre-funded and not directly linked to an individual bank account.
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In addition to our payment solutions, we also offer life science technology solutions targeting blood and plasma collection organizations. These software solutions are marketed under the Apherion™ brand, and we derive our revenue from licensing, hosting and consulting fees.
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According to the 2023 Federal Deposit Insurance Corporation (FDIC) National Survey of Unbanked and Underbanked Households, 5.9 percent of all households were using general purpose reloadable prepaid cards in 2023. Use of prepaid cards was much higher among unbanked households (21.6 percent) than among banked households (5.2 percent).
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Javelin predicts an 8% compound annual growth rate (“CAGR”) from 2025 through 2029, with total open-loop loads projected to reach approximately $450 billion by 2029. The cash access category alone is expected to grow at a 9% CAGR, reaching $350 billion by 2026.
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Unbanked households, an estimated 4.2 percent of U.S. households, were twice as likely to use prepaid cards or nonbank online payment services to conduct four or more types of transactions compared with banked households. Common Examples of Prepaid Cards The prepaid card market is divided into three macro categories based on who funds the card account.
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Consumer sentiment research highlights strong purchase intent, with 35% of users reporting they are more likely to purchase reloadable prepaid cards in the next 12 months, and 42% indicating they will maintain their current purchase levels.
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The platforms also integrate a data infrastructure to support both transaction processing and data warehousing for operational support and data analytics. Competition The markets for financial products and services, including prepaid cards and services related thereto, are intensely competitive.
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The research also shows that 56% of GPR card users are likely to utilize these cards as budgeting tools in the coming year, demonstrating their value beyond simple payment functionality. Common Examples of Prepaid Cards The prepaid card market is divided into three macro categories based on who funds the card account. These categories are consumer-funded, corporate-funded and government-funded.
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Information on our website does not constitute part of this Annual Report.
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Currently, the Company services approximately 48% of the plasma collection centers in the United States and Puerto Rico. Life Science Technology Solutions Paysign offers a cloud-based, state of the art technology platform purpose-built for blood and plasma collection organizations known as Apherion™.
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It combines donor engagement, donor relationship management, core operational systems, compensation optimization, donor payments, competitive market intelligence and quality assurance, into a single, modular operating system designed for regulated, high-volume blood and plasma collection environments.
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Apherion replaces fragmented legacy systems with an integrated platform that enables operators to reduce collection costs, improve donor experience and retention, maintain compliance and scale efficiently across single-center and multi-center donation networks.
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Technology Our technology platform employs a standard enterprise services bus in a service-oriented architecture, configured for 24/7/365 transaction processing and operations. We utilize two secure, interconnected, environmentally-controlled data centers, with emergency power generation capabilities, and fully redundant capabilities, and cloud hosting.
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Any change in such regulation and oversight, whether in the form of restrictions on activities, regulatory policy, regulations, or legislation, including but not limited to changes in the regulations governing banks, could have a material impact on our operations.
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Anti-Money Laundering and Anti-Bribery Laws Our products and services are generally subject to federal anti-money laundering laws, including the Bank Secrecy Act, as amended by the USA PATRIOT Act, and similar state laws.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

40 edited+7 added−5 removed64 unchanged
Biggest changeWe expect that the trading price for our common stock will be affected by any research or reports that securities analysts publish about us or our business. If one or more of the analysts who may elect to cover us or our business downgrade their evaluations of our common stock, the price of our common stock would likely decline.
Biggest changeIf securities analysts do not publish research or reports about our business or if they publish negative evaluations of our common stock, the trading price of our common stock could decline. We expect that the trading price for our common stock will be affected by any research or reports that securities analysts publish about us or our business.
In addition, litigation is time consuming and expensive to defend and could result in the diversion of the time and attention of our management and employees. Any claim from third parties may result in limitations on our ability to use the intellectual property subject to these claims.
In addition, litigation is time-consuming and expensive to defend and could result in the diversion of time and attention of our management and employees. Any claim from third parties may result in limitations on our ability to use the intellectual property subject to these claims.
Adverse global and regional economic conditions such as turmoil affecting the banking system and financial markets, including, but not limited to, tightening in the credit markets, extreme volatility or distress in the financial markets (including the fixed income, credit, currency, equity, and commodity markets), higher unemployment, high consumer debt levels, recessionary or inflationary pressures, supply chain issues, reduced consumer confidence or economic activity, government fiscal and tax policies, U.S. and international trade relationships, agreements, treaties, tariffs and restrictive actions, the inability of a government to enact a budget in a fiscal year, government shutdowns, government austerity programs, and other negative financial news or macroeconomic developments could have a material adverse impact on the demand for our products and services, including a reduction in the volume and size of transactions on our payments platform.
Adverse global and regional economic conditions such as turmoil affecting the banking system and financial markets, including, but not limited to, tightening in the credit markets, extreme volatility or distress in the financial markets (including the fixed income, credit, currency, equity, and commodity markets), high unemployment, high consumer debt levels, recessionary or inflationary pressures, supply chain issues, reduced consumer confidence or economic activity, government fiscal and tax policies, U.S. and international trade relationships, agreements, treaties, tariffs and restrictive actions, the inability of a government to enact a budget in a fiscal year, government shutdowns, government austerity programs, and other negative financial news or macroeconomic developments could have a material adverse impact on the demand for our products and services, including a reduction in the volume and size of transactions on our payments platform.
A security or privacy breach may: · cause our customers to lose confidence in our services; · deter consumers from using our services; · harm our reputation; · require that we expend significant additional resources related to our information security systems and could result in a disruption of our operations; · expose us to liability; · increase expenses related to remediation costs; and · decrease market acceptance of electronic commerce transactions and prepaid use.
A security or privacy breach may: · cause our customers to lose confidence in our services; · deter consumers from using our services; · harm our reputation; · require that we expend significant additional resources related to our information security systems and could result in a disruption of our operations; 13 · expose us to liability; · increase expenses related to remediation costs; and · decrease market acceptance of electronic commerce transactions and prepaid use.
Although we believe we have taken appropriate actions to remediate previously reported control deficiencies that we have identified and to strengthen our internal control over financial reporting, we cannot assure you that we will not discover other deficiencies or weaknesses in the future. 13 Security and privacy breaches of our electronic transactions may damage customer relations and inhibit our growth.
Although we believe we have taken appropriate actions to remediate previously reported control deficiencies that we have identified and to strengthen our internal control over financial reporting, we cannot assure you that we will not discover other deficiencies or weaknesses in the future. Security and privacy breaches of our electronic transactions may damage customer relations and inhibit our growth.
If one or more of these analysts cease coverage of our company, we could lose visibility in the market for our common stock, which in turn could cause our stock price to decline. We do not intend to pay dividends for the foreseeable future. We have never declared or paid any cash dividends on our capital stock.
If one or more of these analysts cease coverage of our company, we could lose visibility in the market for our common stock, which in turn could cause our stock price to decline. 18 We do not intend to pay dividends for the foreseeable future. We have never declared or paid any cash dividends on our capital stock.
All forward-looking statements made by us or on our behalf are qualified by the risks described below. Risks Related to Our Business We may be unable to grow our business in future periods, and if our revenue growth slows, or our revenues decline further, our business and financial conditions could be adversely affected.
All forward-looking statements made by us or on our behalf are qualified by the risks described below. 11 Risks Related to Our Business We may be unable to grow our business in future periods, and if our revenue growth slows, or our revenues decline further, our business and financial conditions could be adversely affected.
As of the date of this filing, we had not received any notice or claim of infringement from any party. 15 The market for electronic commerce services is evolving and may not continue to develop or grow rapidly enough for us to maintain profitability.
As of the date of this filing, we had not received any notice or claim of infringement from any party. The market for electronic commerce services is evolving and may not continue to develop or grow rapidly enough for us to maintain profitability.
If we lose or do not maintain existing banking relationships, we would incur significant switching and other costs and expenses and we and users of our products and services could be significantly affected, creating contingent liabilities for us.
If we lose or do not maintain existing banking relationships, we could incur significant switching and other costs and expenses and we and users of our products and services could be significantly affected, creating contingent liabilities for us.
Third parties may have, or may eventually be issued, patents that would be infringed by our products or technology. Any of these third parties could make a claim of infringement against us with respect to our products or technology. We may also be subject to claims by third parties for breach of copyright, trademark or license usage rights.
Third parties may have, or may eventually be issued, patents that would be infringed upon our products or technology and any of these third parties could make a claim of infringement against us with respect to our products or technology. We may also be subject to claims by third parties for breach of copyright, trademark or license usage rights.
As a result, the failure to maintain adequate banking relationships could have a material adverse effect on our business, results of operations and financial condition. Our agreement with the bank that issues our cards provide for cost and expense allocations between the parties.
As a result, the failure to maintain adequate banking relationships could have a material adverse effect on our business, results of operations and financial condition. Our agreement with the bank that issues our cards provides for cost and expense allocations between the parties.
Our management and other personnel need to devote a substantial amount of time to these compliance initiatives. Moreover, these rules and regulations have increased our legal and financial compliance costs and make some activities more time-consuming and costly. In addition, three putative class action lawsuits were filed against us, which could require our management to devote significant time to defending.
Our management and other personnel need to devote a substantial amount of time to these compliance initiatives. Moreover, these rules and regulations have increased our legal and financial compliance costs and make some activities more time-consuming and costly. In addition, three putative class action lawsuits were filed against us, which required our management to devote significant time to defending.
The termination of the card association registrations held by us or any of the banks that issue our cards or any changes in card association or other debit network rules or standards, including interpretation and implementation of existing rules or standards, that increase the cost of doing business or limit our ability to provide our products and services could have an adverse effect on our business, operating results and financial condition.
The termination of the card association registrations held by us or any of the banks that issue our cards or any changes in card association or other debit network rules or standards, including interpretations or implementations of existing rules or standards, that increase our cost of doing business or limit our ability to provide our products and services, could have an adverse effect on our business, operating results and financial condition.
Concentration of ownership among our existing directors, executive officers and principal stockholders may prevent new investors from influencing significant corporate decisions. Our directors, executive officers, and holders of more than 5% of our total shares of common stock outstanding and their respective affiliates, in the aggregate, beneficially own, as of March 19, 2025, approximately 48% of our outstanding common stock.
Concentration of ownership among our existing directors, executive officers and principal stockholders may prevent new investors from influencing significant corporate decisions. Our directors, executive officers and holders of more than 5% of our total shares of common stock outstanding and their respective affiliates, in the aggregate, beneficially own approximately 31% of our outstanding common stock as of March 9, 2026.
Our success depends upon the efficient and error-free handling of the money. We rely on the ability of our employees, systems and processes and those of the banks that issue our cards, our third-party service providers to process and facilitate these transactions in an efficient, uninterrupted and error-free manner.
We rely on the ability of our employees, systems and processes and those of the banks that issue our cards, and our third-party service providers to process and facilitate these transactions in an efficient, uninterrupted and error-free manner.
Legal Proceedings” for additional information. 19 If we are not able to comply with the requirements of Sarbanes-Oxley Act, or if we or our independent registered public accounting firm identify additional deficiencies in our internal control over financial reporting that are deemed to be material weaknesses, the market price of our stock could decline and we could be subject to sanctions or investigations by the SEC and other regulatory authorities.
If we are not able to comply with the requirements of the Sarbanes-Oxley Act, or if we or our independent registered public accounting firm identify additional deficiencies in our internal control over financial reporting that are deemed to be material weaknesses, the market price of our stock could decline and we could be subject to sanctions or investigations by the SEC and other regulatory authorities. 19 Our operating results may fluctuate in the future, which could cause our stock price to decline.
Acquisitions often involve additional or increased risks including, for example: · managing the complex process of integrating the acquired company’s employees, products and services, technology and other assets in an effort to realize the projected value of the acquired company and the projected synergies of the acquisition; · realizing the anticipated financial benefits from these acquisitions and where necessary, improving controls of these acquired businesses (including internal control over financial reporting and disclosure controls and procedures); · retaining existing customers and attracting new customers; · integrating personnel with diverse business backgrounds and organizational cultures; · integrating the acquired systems and technologies into our Company; · complying with regulatory requirements, including those particular to the industry and jurisdiction of the acquired business, and the need to improve regulatory compliance systems and controls; and · entering new markets with the services of the acquired businesses. 16 Changes in the Bank Secrecy Act and/or the USA PATRIOT Act could impede our ability to circulate cards that can be easily loaded or issued.
Acquisitions often involve additional or increased risks including, for example: · managing the complex process of integrating the acquired company’s employees, products and services, technology and other assets in an effort to realize the projected value of the acquired company and the projected synergies of the acquisition; · realizing the anticipated financial benefits from these acquisitions and where necessary, improving controls of these acquired businesses (including internal control over financial reporting and disclosure controls and procedures); · retaining existing customers and attracting new customers; · integrating personnel with diverse business backgrounds and organizational cultures; · integrating the acquired systems and technologies into our Company; · complying with regulatory requirements, including those particular to the industry and jurisdiction of the acquired business, and the need to improve regulatory compliance systems and controls; and · entering new markets with the services of the acquired businesses.
Also, failure to comply with laws, rules and regulations or standards to which we are subject, including with respect to privacy and data use and security, could result in fines, sanctions or other penalties, which could have a material adverse effect on our financial position and results of operations, as well as damage our reputation.
Also, failure to comply with laws, rules and regulations or standards to which we are subject, including with respect to privacy and data use and security, could result in fines, sanctions or other penalties, which could have a material adverse effect on our financial position and results of operations, as well as damage our reputation. 12 A data security breach could expose us to liability and protracted and costly litigation, and could adversely affect our reputation and operating results.
Management believes future growth in the electronic commerce market will be driven by the cost, convenience, ease of use and quality of products and services offered to consumers and businesses. In order to maintain our profitability, consumers and businesses must continue to adopt our products and services.
Management believes future growth in the electronic commerce market will be driven by the cost, convenience, ease of use and quality of products and services offered to consumers and businesses.
Risks Related to Ownership of Our Common Stock Our stock price is volatile and you may not be able to sell your shares at a price higher than what was paid. The market for our common stock is highly volatile. In 2024, our stock price fluctuated between $2.50 and $5.48.
Risks Related to Ownership of Our Common Stock Our stock price is volatile, and you may not be able to sell your shares at a price higher than what was paid. The market for our common stock is highly volatile. In 2025, our stock price fluctuated between $1.94 and $8.56.
Failure by us or those businesses to comply with the laws and regulations to which we are subject could result in fines, penalties or limitations on our ability to conduct our business, or federal or state actions, any of which could significantly harm our reputation with consumers and other network participants, banks that issue our cards and regulators, and could materially and adversely affect our business, operating results and financial condition. 12 Changes in the laws, regulations, credit card association rules or other industry standards affecting our business may impose costly compliance burdens and negatively impact our business.
Failure by us or those businesses to comply with the laws and regulations to which we are subject could result in fines, penalties or limitations on our ability to conduct our business, or federal or state actions, any of which could significantly harm our reputation with consumers and other network participants, banks that issue our cards and regulators, and could materially and adversely affect our business, operating results and financial condition.
Our stock price could decline due to the large number of outstanding shares of our common stock eligible for future sale. We have 53,747,674 shares of common stock outstanding as of March 19, 2025, assuming no exercise of outstanding options or unvested restricted stock awards.
Our stock price could decline due to the large number of outstanding shares of our common stock eligible for future sale. We have 55,185,394 shares of common stock outstanding as of March 9, 2026, assuming no exercise of outstanding options or unvested restricted stock awards.
The trading price of our common stock could be subject to wide fluctuations in response to, among other things, quarterly variations in operating and financial results, announcements of technological innovations or new products by our competitors or us, changes in prices of our products and services or our competitors’ products and services, changes in product mix, or changes in our revenue and revenue growth rates. 18 If securities analysts do not publish research or reports about our business or if they publish negative evaluations of our common stock, the trading price of our common stock could decline.
The trading price of our common stock could be subject to wide fluctuations in response to, among other things, quarterly variations in operating and financial results, announcements of technological innovations or new products by our competitors or us, changes in prices of our products and services or our competitors’ products and services, changes in product mix or changes in our revenue and revenue growth rates.
Our competitors may independently develop similar technology, duplicate our products or services or design around our intellectual property rights. We may have to litigate to enforce and protect our intellectual property rights, trade secrets and know-how or to determine their scope, validity or enforceability, which is expensive and could cause a diversion of resources and may not prove successful.
Our competitors may independently develop similar technology, duplicate our products or services or design around our intellectual property rights. We may need to litigate to enforce or protect our intellectual property rights, trade secrets and know-how, or to determine their scope, validity or enforceability. Such litigation can be expensive, may divert resources, and may not be successful.
Our ability to provide reliable service to our clients and cardholders depends on the efficient and uninterrupted operation of our computer network systems and data centers as well as those of our third-party service providers. Our business involves movement of large sums of money, processing of large numbers of transactions and management of the data necessary to do both.
Our business is dependent on the efficient and uninterrupted operation of computer network systems and data centers. Our ability to provide reliable service to our clients and cardholders depends on the efficient and uninterrupted operation of our computer network systems and data centers as well as those of our third-party service providers.
If we do not respond to rapid technological change or changes in industry standards, our products and services could become obsolete and we could lose our customers. If competitors introduce new products and services, or if new industry standards and practices emerge, our existing product and service offerings, technology and systems may become obsolete.
If competitors introduce new products and services, or if new industry standards and practices emerge, our existing product and service offerings, technology and systems may become obsolete.
We depend on key personnel and could be harmed by the loss of their services because of the limited number of qualified people in our industry. Because of our small size, we require the continued service and performance of our management team, sales and technology employees, all of whom we consider to be key employees.
Because of our small size and the limited number of qualified professionals in our industry, we rely heavily on the continued service and performance of our management team and our experienced sales, marketing, program and technology personnel, all of whom we consider key employees.
In addition, we may be unable to maintain adequate banking relationships or renew our agreements with the banks that currently issue our cards under terms at least as favorable to us as those existing before renewal. 14 We receive important services from third-party vendors, and replacing them could entail unexpected integration costs.
Changes in the costs and expenses that we have to bear under these relationships could have a material impact on our operating expenses. In addition, we may be unable to maintain adequate banking relationships or renew our agreements with the banks that currently issue our cards under terms at least as favorable to us as those existing before renewal.
Our operating results may fluctuate in the future, which could cause our stock price to decline. Our quarterly and annual results of operations may fluctuate in the future as a result of a variety of factors, many of which are outside of our control.
Our quarterly and annual results of operations may fluctuate in the future as a result of a variety of factors, many of which are outside of our control. If our results of operations fall below the expectations of investors or any securities analysts who follow our common stock, the trading price of our common stock could decline substantially.
These regulations require financial institutions to obtain and confirm information related to their respective cardholders. If the BSA and/or the USA PATRIOT Act or subsequent legislation increases the level of scrutiny that we must apply to our cardholders and customers, it may be costly or impractical for us to continue to profitably issue and load cards for our customers.
If the BSA and/or the USA PATRIOT Act or subsequent legislation increases the level of scrutiny that we must apply to our cardholders and customers, it may be costly or impractical for us to continue to profitably issue and load cards for our customers. 16 Internal processing errors could result in our failing to appropriately reflect transactions in customer accounts.
A data security breach could expose us to liability and protracted and costly litigation, and could adversely affect our reputation and operating results. We, the banks that issue our cards and our third-party service providers receive, transmit and store confidential customer and other information in connection with our products and services.
We, the banks that issue our cards and our third-party service providers receive, transmit and store confidential customer and other information in connection with our products and services.
In addition, we may not be able to retain our current key employees. The loss of the services of one or more of our key personnel and our failure to attract additional highly qualified personnel could impair our ability to expand our operations and provide service to our customers.
The loss of the services of one or more key employees, our failure to attract or retain additional highly qualified personnel, or our inability to effectively integrate and motivate such individuals could impair our ability to manage and expand our business and provide services to our customers.
There may be changes in the laws, regulations, card association rules or other industry standards that affect our operating environment in substantial and unpredictable ways. Changes to statutes, regulations or industry standards, including interpretation and implementation of statutes, regulations or standards, could increase the cost of doing business or affect the competitive balance.
Changes in the laws, regulations, credit card association rules or other industry standards affecting our business may impose costly compliance burdens and negatively impact our business. There may be changes in the laws, regulations, card association rules or other industry standards that affect our operating environment in substantial and unpredictable ways.
Our future success depends on our ability to attract, develop, incentivize and retain key personnel. Our future success depends, to a significant extent, on our ability to attract, develop, incentivize and retain key personnel, namely our management team and experienced sales, marketing and program and technology personnel.
Our future success depends, to a significant extent, on our ability to attract, source, hire, train, develop, incentivize and retain highly skilled directors, officers, management, financial, legal, marketing, sales and technical personnel.
Internal processing errors could result in our failing to appropriately reflect transactions in customer accounts. In the event of a system failure that goes undetected for a substantial period of time, we could allow transactions on blocked accounts, confirm false authorizations, fail to deduct charges from accounts or fail to detect systematic fraud or abuse.
In the event of a system failure that goes undetected for a substantial period of time, transactions could be processed on blocked accounts, false authorizations could be confirmed, charges could fail to be deducted from accounts or systematic fraud or abuse could go undetected. Errors or failures of this nature could adversely impact our operations, credibility and financial standing.
For example, more stringent anti-money laundering regulations could require the collection and verification of more information from our customers, which could have a material adverse effect on our operations. Regulation of the payments industry has increased significantly in recent years. Additional regulatory changes may require us to incur significant expenses to redevelop our products.
Regulation of the payments industry has increased significantly in recent years. Additional regulatory changes may require us to incur significant expenses to redevelop our products.
Changes in credit card association or other network rules or standards set by Visa and MasterCard, or changes in card association and debit network fees or products or interchange rates, could adversely affect our business, financial position and results of operations.
However, in some cases, replacing a vendor would require one-time integration costs to connect our systems to those of the new vendor, and could result in less advantageous contract terms for the same service, which could adversely affect our profitability. 14 Changes in credit card association or other network rules or standards set by Visa and MasterCard, or changes in card association and debit network fees or products or interchange rates, could adversely affect our business, financial position and results of operations.
Some services relating to our business, including network connectivity and gateway services are outsourced to third-party vendors. All of our vendors could be replaced with competitors if our vendor terminated our contract or went out of business.
We receive important services from third-party vendors, and replacing them could entail unexpected integration costs. Some services relating to our business, including network connectivity and gateway services, are outsourced to third-party vendors. If any of our vendors were to terminate their contracts with us or cease operations, we could replace the vendor with a competitor.
We must motivate and retain existing personnel and also attract, source, hire, develop and retain highly-qualified employees. We may experience difficulty fully integrating our newly-hired personnel, which may adversely affect our business. Competition for qualified management, sales, marketing and program and technology personnel can be intense.
Competition for qualified employees in the financial services and healthcare industries is intense, and competitors have in the past and may in the future attempt to recruit our management and other key employees. We may also experience difficulty integrating newly hired personnel, which could adversely affect our operations.
Competitors have in the past and may in the future attempt to recruit our top management and employees. If we fail to attract, integrate, incentivize and retain key personnel, our ability to manage and grow our business could be harmed.
We depend on key personnel and may be harmed by the loss of their services or our inability to attract, develop, integrate, incentivize and retain qualified employees.
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Changes in the costs and expenses that we have to bear under these relationships could have a material impact on our operating expenses.
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Changes to statutes, regulations or industry standards, including interpretation and implementation of statutes, regulations or standards, could increase the cost of doing business or affect the competitive balance. For example, more stringent anti-money laundering regulations could require the collection and verification of more information from our customers, which could have a material adverse effect on our operations.
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However, in some cases replacing a vendor would entail one-time integration costs to connect our systems to the successor’s systems, and could result in less advantageous contract terms for the same service, which could adversely affect our profitability.
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In order to maintain our profitability, consumers and businesses must continue to adopt our products and services. 15 If we do not respond to rapid technological change or changes in industry standards, our products and services could become obsolete and we could lose our customers.
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Errors or failures of this nature could adversely impact our operations, our credibility and our financial standing. Our business is dependent on the efficient and uninterrupted operation of computer network systems and data centers.
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Changes in the Bank Secrecy Act and/or the USA PATRIOT Act could impede our ability to circulate cards that can be easily loaded or issued.
Removed
Competition for highly qualified employees in the financial services and healthcare industry is intense. Our success will depend to a significant degree upon our ability to attract, train, and retain highly skilled directors, officers, management, business, financial, legal, marketing, sales, and technical personnel and upon the continued contributions of such people.
Added
These regulations require financial institutions to obtain and confirm information related to their respective cardholders.
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If our results of operations fall below the expectations of investors or any securities analysts who follow our common stock, the trading price of our common stock could decline substantially.
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Our business involves movement of large sums of money, processing of large numbers of transactions and management of the data necessary to do both. Our success depends upon the efficient and error-free handling of the money.
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If one or more of the analysts who may elect to cover us or our business downgrade their evaluations of our common stock, the price of our common stock would likely decline.
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See “Item 3. Legal Proceedings” for additional information.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThis program includes: · Vendor Onboarding and Due Diligence: New vendors undergo security assessments to evaluate their data protection measures, regulatory compliance, and cybersecurity policies. · Ongoing Monitoring and Risk Assessments: We conduct periodic reviews of vendor security practices which may include security questionnaires, risk scoring, and audits for high-risk vendors. · Contractual Security Obligations: Vendor agreements include strict data security clauses, incident notification requirements, and audit rights. · Incident Reporting and Escalation: We have clear protocols for reporting vendor-related cybersecurity incidents, ensuring timely response and mitigation.
Biggest changeThis program includes: · Vendor Onboarding and Due Diligence: New vendors undergo security assessments to evaluate their data protection measures, regulatory compliance and cybersecurity policies. · Ongoing Monitoring and Risk Assessments: We conduct periodic reviews of vendor security practices which may include security questionnaires, risk scoring, and audits for high-risk vendors. · Contractual Security Obligations: Vendor agreements include strict data security clauses, incident notification requirements and audit rights. · Incident Reporting and Escalation: We have clear protocols for reporting vendor-related cybersecurity incidents, ensuring timely response and mitigation. · Vendors are risk tiered based on criticality, and high-risk vendors undergo enhanced due diligence activities, including review of System and Organization Controls reports, penetration test summaries and continuous monitoring signals where available. 21 Partnerships and Collaboration We believe in the strength of collaboration in combating cyber threats.
To mitigate the threat to our business, we take a comprehensive approach to cybersecurity risk management and make securing the data customers and other stakeholders entrust to us a top priority. Our Board and our management are actively involved in the oversight of our risk management program, of which cybersecurity represents an important component.
To mitigate the threat to our business, we take a comprehensive approach to cybersecurity risk management and make securing the data that customers and other stakeholders entrust to us a top priority. Our Board and our management are actively involved in the oversight of our risk management program, of which cybersecurity represents an important component.
They receive regular reports from management about the prevention, detection, mitigation, and remediation of cybersecurity incidents, including material security risks and information security vulnerabilities. Our Audit Committee directly oversees our cybersecurity program.
Governance Board Oversight Our Board, in coordination with the Audit Committee, oversees our management of cybersecurity risk. They receive regular reports from management about the prevention, detection, mitigation, and remediation of cybersecurity incidents, including material security risks and information security vulnerabilities. Our Audit Committee directly oversees our cybersecurity program.
ITEM 1C. CYBERSECURITY. Risk Management and Strategy Cyber criminals are becoming more sophisticated and effective every day, and they are increasingly targeting software companies. All companies utilizing technology are subject to threats of breaches of their cybersecurity programs.
ITEM 1C. CYBERSECURITY. Risk Management and Strategy Cyber criminals are becoming more sophisticated and effective every day, and they are increasingly targeting software companies, including companies like ours that handle sensitive customer and stakeholder data. All companies utilizing technology are subject to threats of breaches of their cybersecurity programs.
Our commitment to cybersecurity is unwavering, and we adopt a serious, multi-layered approach to minimize the risks and potential impacts of cyber-attacks which has been integrated into our overall risk management process. Our strategies are designed to ensure the resilience and security of our systems, safeguarding against both internal and external vulnerabilities.
Our commitment to cybersecurity is unwavering, and we adopt a serious, multi-layered approach to minimize the risks and potential impacts of cyber-attacks which has been integrated into our overall risk management process.
The Audit Committee receives regular updates from management on cybersecurity risk resulting from risk assessments, progress of risk reduction initiatives, external auditor feedback, control maturity assessments, and relevant internal and industry cybersecurity incidents. 22 Management’s Role Our Chief Technology Officer, Information Security Officer, and General Counsel have primary responsibility for assessing and managing material cybersecurity risks and are members of our management’s Information Technology Steering Committee (the “Security Committee”), which is a governing body that drives alignment on security decisions across the Company.
Management’s Role Our Chief Technology Officer, Information Security Officer, and General Counsel have primary responsibility for assessing and managing material cybersecurity risks and are members of our management’s Information Technology Steering Committee (the “Security Committee”), which is a governing body that drives alignment on security decisions across the Company.
Although our Risk Factors include further detail about the material cybersecurity risks we face, we believe that risks from prior cybersecurity threats, including as a result of any previous cybersecurity incidents, have not materially affected our business to date.
While our Risk Factors describe in greater detail the material cybersecurity risks we face, we believe that prior cybersecurity threats, including any previous cybersecurity incidents, have not materially impacted our business to date.
Our multi-layered approach—encompassing system security, vigilant monitoring, comprehensive training, and collaborative engagement—demonstrates our dedication to protecting our company, our clients, and the financial ecosystem. We remain steadfast in our commitment to maintaining the highest standards of cybersecurity resilience and response.
Incident Response and Recovery Planning Cybersecurity is a foundational element of our operations. Our multi-layered approach—encompassing system security, vigilant monitoring, comprehensive training, and collaborative engagement—demonstrates our dedication to protecting our company, our clients, and the financial ecosystem.
Education and Awareness Recognizing that human error can often be a weak link in cybersecurity defenses, we are committed to regular and comprehensive training for all employees and executives. This includes annual cybersecurity awareness sessions for our Board, ensuring that our highest levels of leadership are informed and vigilant about the latest cybersecurity trends and threats.
Education and Awareness Recognizing that human error can often be a weak link in cybersecurity defenses, we are committed to regular and comprehensive training for all employees and executives.
We maintain controls and procedures that are designed to ensure prompt escalation of certain cybersecurity incidents so that decisions regarding public disclosure and reporting of such incidents can be made by management and the Board in a timely manner. 21 Risk Assessment We continuously monitor our information technology environment to detect and respond to threats in real-time.
By sharing knowledge and best practices, we enhance our defenses and contribute to the broader effort of securing the digital ecosystem. We maintain controls and procedures that are designed to ensure prompt escalation of certain cybersecurity incidents so that decisions regarding public disclosure and reporting of such incidents can be made by management and the Board in a timely manner.
We can provide no assurance that there will not be incidents in the future or that they will not materially affect us, including our business strategy, results of operations, or financial condition. Risk Management and Strategy We understand the critical importance of cybersecurity in protecting our operations, customer data, and the integrity of our services.
However, we cannot guarantee that future incidents will not occur or that, if they do, they will not have a material adverse effect on our business, strategy, results of operations, or financial condition. Risk Management and Strategy We understand the critical importance of cybersecurity in protecting our operations, customer data, and the integrity of our services.
We employ state-of-the-art technologies and practices to secure our systems. This includes deploying advanced encryption, securing network infrastructure, and implementing robust access controls and authentication mechanisms.
This includes deploying advanced encryption, securing network infrastructure, and implementing robust access controls and authentication mechanisms.
Cybersecurity Threats We are not aware of any risks from cybersecurity threats, including as a result of any previous cybersecurity incidents, that have materially affected or are reasonably likely to materially affect, our business strategy, results of operations, or financial condition. Governance Board Oversight Our Board, in coordination with the Audit Committee, oversees our management of cybersecurity risk.
We also conduct periodic phishing simulations, evaluate key performance indicators such as employee susceptibility rates, and track cybersecurity awareness metrics as part of our overall risk management dashboard. 22 Cybersecurity Threats We are not aware of any risks from cybersecurity threats, including as a result of any previous cybersecurity incidents, that have materially affected or are reasonably likely to materially affect our business strategy, results of operations, or financial condition.
Semi-annually, we leverage third-party independent consultants to perform penetration and segmentation testing of our internal and externally facing environments.
Semi-annually, we leverage third-party independent consultants to perform penetration and segmentation testing of our internal and externally facing environments. Results from these assessments inform remediation roadmaps, prioritization of security investments, and updates to our enterprise risk register. Technical Safeguards Cybersecurity is an ever-evolving field, and we are committed to continuous improvement of our security practices.
We have established comprehensive incident response and recovery plans and continue to regularly test and evaluate the effectiveness of those plans. Our incident response and recovery plans address and guide our employees, management and the Board on our response to a cybersecurity incident.
Our incident response program includes ransomware specific playbooks, cross functional tabletop exercises involving senior leadership, and tight integration with our business continuity (BCP) and disaster recovery (DR) plans. We have established comprehensive incident response and recovery plans and continue to regularly test and evaluate the effectiveness of those plans.
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There can be no guarantee that our policies and procedures will be properly followed in every instance or that those policies and procedures will be effective.
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While no cybersecurity program can eliminate all risk or guarantee complete effectiveness, our controls are designed in alignment with industry recognized frameworks such as the NIST Cybersecurity Framework and incorporate key principles of ISO 27001.
Removed
While we can provide no assurance against unauthorized access and breaches, our information technology infrastructure is designed with security at its core, with all data, whether at rest or in transit, being protected against unauthorized access and breaches.
Added
Our cybersecurity controls are guided by a formal data classification policy and are supported by a maturing Zero Trust–inspired architecture, which includes least privilege access, continuous authentication and micro segmentation. Our strategies are designed to ensure the resilience and security of our systems, safeguarding against both internal and external vulnerabilities. We employ state-of-the-art technologies and practices to secure our systems.
Removed
Partnerships and Collaboration We believe in the strength of collaboration in combating cyber threats. We actively engage with cybersecurity communities, industry groups, and regulatory bodies to stay ahead of evolving cyber risks. By sharing knowledge and best practices, we enhance our defenses and contribute to the broader effort of securing the digital ecosystem.
Added
Our information technology infrastructure is designed with security at its core, incorporating full encryption of data in transit and at rest, endpoint detection and response, security information and event management correlation, continuous vulnerability scanning and commercial threat intelligence feeds monitored by our 24/7/365 Security Operations Center.
Removed
Our dedicated cybersecurity team uses sophisticated tools to track anomalies, potential vulnerabilities, and ongoing attacks. This includes leveraging a best-in-class third-party 24/7/365 Security Operations Center. This proactive surveillance allows us to address threats swiftly, mitigating any possible impact on our operations and clients.
Added
We actively engage with cybersecurity communities, industry groups, and regulatory bodies to stay ahead of evolving cyber risks. We also participate in threat sharing programs and use horizon scanning activities to evaluate emerging risks that may impact fintech, payments infrastructure, and healthcare related data environments.
Removed
The results of the assessment are used to drive alignment on, and prioritization of, initiatives to enhance our security controls, make recommendations to improve processes, and inform a broader risk assessment that is presented to our Board, Audit Committee, and members of management.
Added
Risk Assessment We continuously monitor our information technology environment to detect and respond to threats in real-time. Our dedicated cybersecurity team uses sophisticated tools to track anomalies, potential vulnerabilities, and ongoing attacks. In addition to annual penetration and segmentation testing, we conduct periodic threat hunting exercises to proactively identify malicious activity.
Removed
Technical Safeguards Cybersecurity is an ever-evolving field, and we are committed to continuous improvement of our security practices. We regularly review and update our cybersecurity policies, procedures, and technologies to address new challenges and adapt to the changing threat landscape. Incident Response and Recovery Planning Cybersecurity is a foundational element of our operations.
Added
We regularly review and update our cybersecurity policies, procedures, and technologies to address new challenges and adapt to the changing threat landscape. Technical safeguards also include multi factor authentication (MFA) across all privileged and non-privileged accounts, automated provisioning and de provisioning, periodic access reviews, and comprehensive logging and monitoring to support audit and regulatory obligations.
Removed
Our training programs are designed to foster a culture of security awareness, equipping our team with the knowledge and tools needed to recognize and prevent cyber threats.
Added
The Audit Committee receives regular updates from management on cybersecurity risk resulting from risk assessments, progress of risk reduction initiatives, external auditor feedback, control maturity assessments, and relevant internal and industry cybersecurity incidents. The Board receives quarterly cybersecurity briefings, including key risk indicators, remediation metrics, third party risk insights, and updates to our threat landscape assessment.
Added
Management evaluates the cybersecurity program using defined key risk indicators, including patch timeliness metrics, vulnerability severity reduction intervals, access review completion rates, phishing resilience metrics and third party assurance results.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeITEM 2. PROPERTIES. We have an operating lease for office space at 2615 St. Rose Parkway, Henderson, Nevada 89052. The lease will expire in 2030 and allows for two optional extensions of 5 years each. Lease payments are approximately $60,000 per month. We believe that our properties are adequate and suitable for us to conduct business in the future.
Biggest changeITEM 2. PROPERTIES. We have an operating lease for office space at 2615 St. Rose Parkway, Henderson, Nevada 89052. The lease will expire in 2030 and allows for two optional extensions of 5 years each. Lease payments are approximately $60,000 per month. We have an operating lease for office space at 168 N. Gibson Road, Henderson, Nevada 89014.
Added
The lease will expire in 2033 and allows for two optional extensions of 5 years each. Lease payments are approximately $60,000 per month. We believe that our properties are adequate and suitable for us to conduct business in the future. 23

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeThe Company has also been named as a nominal defendant in a fourth stockholder derivative action in the United States District Court for the District of Nevada, filed on December 27, 2023, entitled Mo Jeewa, derivatively on behalf of Paysign, Inc. v. Mark R. Newcomer, et al.
Biggest changeOn July 26, 2024, the parties in Blanchette submitted a Joint Status Report which suggested a proposed briefing schedule on a motion to dismiss, but that schedule was not ruled upon by the Court. 24 The Company was also named as a nominal defendant in a fourth stockholder derivative action in the United States District Court for the District of Nevada, filed on December 27, 2023, entitled Mo Jeewa, derivatively on behalf of Paysign, Inc. v.
This action alleges violations of Section 14(a) of the Exchange Act, breach of fiduciary duty, unjust enrichment, and waste, largely in connection with the failure to correct information technology controls over financial reporting alleged in the Securities Class Action, thereby causing the Company to face exposure in the Securities Class Action.
This action alleged violations of Section 14(a) of the Exchange Act, breach of fiduciary duty, unjust enrichment, and waste, largely in connection with the failure to correct information technology controls over financial reporting alleged in the Securities Class Action, thereby causing the Company to face exposure in the Securities Class Action.
The complaint also alleges insider trading violations against certain individual defendants. The second-filed derivative action is entitled John K. Gray, derivatively on behalf of Paysign, Inc. v. Mark Attinger, et al. and was filed on May 9, 2022.
The complaint also alleged insider trading violations against certain individual defendants. The second-filed derivative action is entitled John K. Gray, derivatively on behalf of Paysign, Inc. v. Mark Attinger, et al. and was filed on May 9, 2022.
Mark Newcomer, et al, which the defendants subsequently removed to federal district court in Nevada pursuant to a Notice of Removal filed on October 10, 2023. That complaint makes substantially the same allegations as made in the consolidated Toczek and Gray actions, and also contains a claim that the individual defendants violated Section 10(b) and Rule 10b-5 promulgated thereunder.
Mark Newcomer, et al, which the defendants subsequently removed to federal district court in Nevada pursuant to a Notice of Removal filed on October 10, 2023. That complaint made substantially the same allegations as made in the consolidated Toczek and Gray actions, and also contained a claim that the individual defendants violated Section 10(b) and Rule 10b-5 promulgated thereunder.
The Company has also been named as a nominal defendant in a third stockholder derivative action initially filed in state court in Clark County, Nevada, on October 2, 2023, entitled Simone Blanchette, derivatively on behalf of Paysign, Inc. v.
The Company was also named as a nominal defendant in a third stockholder derivative action initially filed in state court in Clark County, Nevada, on October 2, 2023, entitled Simone Blanchette, derivatively on behalf of Paysign, Inc. v.
On April 17, 2024, the Court conducted the final approval hearing and approved the settlement and, on April 18, 2024, issued an order and final judgment thereon. 23 The Company has also been named as a nominal defendant in four stockholder derivative actions currently pending in the United States District Court for the District of Nevada.
On April 17, 2024, the Court conducted the final approval hearing and approved the settlement and, on April 18, 2024, issued an order and final judgment thereon. The Company was also named as a nominal defendant in four stockholder derivative actions currently pending in the United States District Court for the District of Nevada.
This action involves the same alleged conduct raised in the Toczek action and asserts claims for breach of fiduciary duty in connection with financial reporting, breach of fiduciary duty in connection with alleged insider trading against certain individual defendants, and unjust enrichment.
This action involved the same alleged conduct raised in the Toczek action and asserted claims for breach of fiduciary duty in connection with financial reporting, breach of fiduciary duty in connection with alleged insider trading against certain individual defendants, and unjust enrichment.
On October 4, 2024, the parties to the four stockholder derivative actions agreed in principle to a proposed settlement of all pending claims asserted in the Toczek, Gray, Blanchette, and Jeewa actions. On December 6, 2024, Plaintiffs in the Toczek and Gray actions filed a Motion for Preliminary Approval of Derivative Settlement, which is currently pending before the Court.
On October 4, 2024, the parties to the four stockholder derivative actions agreed in principle to a proposed settlement of all pending claims asserted in the Toczek, Gray, Blanchette, and Jeewa actions. On December 6, 2024, Plaintiffs in the Toczek and Gray actions filed a Motion for Preliminary Approval of Derivative Settlement.
That complaint makes substantially the same allegations as made in the consolidated Toczek and Gray actions and the Blanchette action discussed above, and alleges breach of fiduciary duty and unjust enrichment. On January 23, 2025, the parties in Jeewa filed a stipulation to relate the case to the Toczek, Gray, and Blanchette actions, which is currently pending before the Court.
Mark R. Newcomer, et al. That complaint made substantially the same allegations as made in the consolidated Toczek and Gray actions and the Blanchette action discussed above, and alleged breach of fiduciary duty and unjust enrichment. On January 23, 2025, the parties in Jeewa filed a stipulation to relate the case to the Toczek, Gray, and Blanchette actions.
Removed
On July 26, 2024, the parties in Blanchette submitted a Joint Status Report which suggested a proposed briefing schedule on a motion to dismiss, but that schedule was not ruled upon by the Court.
Added
On May 6, 2025, the Court granted the parties’ request to relate the actions and assigned all four cases to the judge presiding over the Jeewa action.
Removed
ITEM 4. MINE SAFETY DISCLOSURES. Not applicable. 24 PART II
Added
On August 28, 2025, the Court issued a minute order granting the Motion for Preliminary Approval of Derivative Settlement and, on October 7, 2025, it entered a Scheduling Order and Preliminary Approval Order, effective nunc pro tunc as of September 4, 2025.
Added
On October 17, 2025, Plaintiffs filed a Motion for Final Approval of Derivative Settlement, which was granted by the Court on December 14, 2025 with the final order and judgment entered on December 16, 2025. ITEM 4. MINE SAFETY DISCLOSURES. Not applicable. 25 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe following table summarizes the low and high closing prices for our common stock for each of the calendar quarters of 2024 and 2023. 2024 2023 High Low High Low First Quarter $ 4.00 $ 2.50 $ 3.98 $ 2.48 Second Quarter 5.02 3.85 3.78 2.39 Third Quarter 5.48 3.67 2.47 1.78 Fourth Quarter 4.08 2.93 2.80 1.69 There were approximately 8,915 shareholders of record of the common stock as of December 31, 2024.
Biggest changeThe following table summarizes the low and high closing prices for our common stock for each of the calendar quarters of 2025 and 2024. 2025 2024 High Low High Low First Quarter $ 3.25 $ 2.12 $ 4.00 $ 2.50 Second Quarter 7.20 1.94 5.02 3.85 Third Quarter 8.56 5.11 5.48 3.67 Fourth Quarter 6.34 4.99 4.08 2.93 There were approximately 12,941 shareholders of record of the common stock as of December 31, 2025.
The shares were issued pursuant to an exemption from registration provided by Section 4(2) of the Securities Act of 1933. Dividend Policy We have not declared any cash dividends on our common stock during our fiscal years ended on December 31, 2024 or 2023.
The shares were issued pursuant to an exemption from registration provided by Section 4(2) of the Securities Act of 1933. Dividend Policy We have not declared any cash dividends on our common stock during our fiscal years ended on December 31, 2025 or 2024.
Our Board has made no determination to date to declare cash dividends during the foreseeable future, but is not likely to do so. There are no restrictions on our ability to pay dividends.
Our Board has made no determination to date to declare cash dividends during the foreseeable future, and is not likely to do so. There are no restrictions on our ability to pay dividends.
Purchases of Equity Securities by the Issuer and Affiliated Purchasers Share repurchases of our common stock for the three months ended December 31, 2024 were as follows: Period Total Number of Shares Purchased Weighted Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs October 1, 2024 – October 31, 2024 36,700 $ 3.67 – $ 3,377,071 November 1, 2024 - November 30, 2024 – – – 3,377,071 December 1, 2024 - December 31, 2024 – – – 3,377,071 Total 36,700 $ 3.67 – $ 3,377,071 25 (1) On March 21, 2023, our Board authorized a stock repurchase program to repurchase up to $5 million of our common stock, subject to certain conditions, in the open market, in privately negotiated transactions, or by other means in compliance with Rule 10b-18 under the Exchange Act.
Purchases of Equity Securities by the Issuer and Affiliated Purchasers Share repurchases of our common stock for the three months ended December 31, 2025 were as follows: Period Total Number of Shares Purchased Weighted Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs October 1, 2025 – October 31, 2025 – $ – – $ 3,001,285 November 1, 2025 - November 30, 2025 – – – 3,001,285 December 1, 2025 - December 31, 2025 – – – 3,001,285 Total – $ – – $ 3,001,285 (1) On March 21, 2023, our Board authorized a stock repurchase program to repurchase up to $5 million of our common stock, subject to certain conditions, in the open market, in privately negotiated transactions, or by other means in compliance with Rule 10b-18 under the Exchange Act.
The program is expected to be completed within 36 months from the commencement date. As of December 31, 2024 the Company repurchased 531,258 shares of common stock for $1,622,929 at a weighted average price of $3.05 per share.
The program is expected to be completed within 36 months from the commencement date. As of December 31, 2025 the Company had repurchased 631,258 shares of common stock for $1,998,715 at a weighted average price of $3.17 per share under this repurchase program. ITEM 6. [RESERVED]
Removed
On February 7, 2025, under our Board authorized stock repurchase program, we closed on the repurchase of 100,000 shares of common stock for $375,786 at a weighted average price of $3.76 per share. After the purchase, the approximate dollar value of shares that may yet be purchased under the program is $3,001,285. ITEM 6. [RESERVED]

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Biggest changeOTHER INFORMATION 37 ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS 37 PART III 38 ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE 38 ITEM 11. EXECUTIVE COMPENSATION 38 ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS 38 ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE 38 ITEM 14.
Biggest changeOTHER INFORMATION 38 ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS 38 PART III 39 ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE 39 ITEM 11. EXECUTIVE COMPENSATION 39 ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS 39 ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE 39 ITEM 14.
We undertake no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof. You should refer to and carefully review the information in future documents we file with the Securities and Exchange Commission. i PART I
We undertake no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof. You should refer to and carefully review the information in future documents we file with the Securities and Exchange Commission. ii PART I
PRINCIPAL ACCOUNTANT FEES AND SERVICES 38 PART IV 39 ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES 39 ITEM 16 FORM 10-K SUMMARY 40 SIGNATURES 41 Cautionary Note Regarding Forward Looking Statements This Annual Report on Form 10-K contains “forward-looking statements.” These forward-looking statements are based on our current expectations, assumptions, estimates and projections about our business and our industry.
PRINCIPAL ACCOUNTANT FEES AND SERVICES 39 PART IV 40 ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES 40 ITEM 16 FORM 10-K SUMMARY 41 SIGNATURES 42 i Cautionary Note Regarding Forward Looking Statements This Annual Report on Form 10-K contains “forward-looking statements.” These forward-looking statements are based on our current expectations, assumptions, estimates and projections about our business and our industry.
ITEM 6. [RESERVED] 26 ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 26 ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 35 ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA 35 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE 35 ITEM 9A. CONTROLS AND PROCEDURES 36 ITEM 9B.
ITEM 6. [RESERVED] 27 ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 27 ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 36 ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA 36 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE 37 ITEM 9A. CONTROLS AND PROCEDURES 37 ITEM 9B.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeSpecific forward-looking statements made herein include: our belief that we cannot predict how future regulations might affect us; complying with future regulation could be expensive or require us to change the way we operate our business; our belief that our in-house customer service center provides the highest customer service experience for our clients as training is performed on-site by Paysign staff; we may utilize independent contractors who make direct sales and are paid on a commission basis only; our belief that nearly ever state would require us to obtain a money transmitter license to operate a money transfer business; our anticipation that we will not pay any cash dividends in the foreseeable future; our intention to retain any earnings to finance the operation and expansion of our business; our intention to continue to make significant investments to maintain the security of our data and cybersecurity infrastructure; our expectation that the trading price for our common stock will be affected by any research or reports that securities analysts publish about us or our business; our belief that our editing processes are consistent with applicable reimbursement rules and industry practice, a court, enforcement agency or whistleblower could challenge these practices; our belief that all independent contractor and employment agreement relationships are satisfactory; our belief that we have taken appropriate actions to remediate previously reported control deficiencies that we have identified and to strengthen our internal control over financial reporting; our belief that we have utilized proven systems designed for robust data security and integrity in electronic transactions, we may introduce products in the future that would be subject to such regulations; our belief that a data security breach at one of the banks that issue our cards or our third-party service providers could result in significant reputational harm to us and cause the use and acceptance of our cards to decline, either of which could have a significant adverse impact on our operating results and future growth prospects; our belief that our existing competitors have longer operating histories, are substantially larger than we are, may already have or could develop substantially greater financial and other resources than we have, may offer, develop or introduce a wider range of programs and services than we offer or may use more effective advertising and marketing strategies than we do to achieve broader brand recognition, customer awareness and retail penetration; our expectation that we may also face price competition that results in decreases in the purchase and use of our products and services; our expectation that we may have to increase the incentives that we offer to our marketing partners and decrease the prices of our products and services, which could adversely affect our operating results; we may receive a stockholder proposal relating to a variety of ESG issues to public companies in the future; we may be subject to, or contractually required to comply with, state and federal laws that govern various aspects of the submission of healthcare claims for reimbursement and the receipt of payments for healthcare items or services; we may use and disclose individually identifiable health information to perform our services and for other limited purposes, such as creating de-identified information; we may not be able to detect unauthorized use of our intellectual property or proprietary information, or to take enforcement action; we may retain additional employees and consultants during the next twelve months, including additional patient affordability, information technology, product and project management, fraud, and customer care personnel to support our growing businesses; we may be unable to grow our business in future periods, and if our revenue growth slows, or our revenues decline further, our business and financial conditions could be adversely affected; we may experience a decline in margins; we may have deficiencies or weaknesses in our internal control over financial reporting which could, if not remediated, adversely affect our ability to report our financial condition and results of operations in a timely and accurate manner, decrease investor confidence in our Company, and reduce the value of our common stock; we may face price competition that results in decreases in the purchase and use of our products and services; we may have to increase the incentives that we offer to our marketing partners and decrease the prices of our products and services, which could adversely affect our operating results; we may be unable to maintain adequate banking relationships or renew our agreements with the banks that currently issue our cards under terms at least as favorable to us as those existing before renewal; we may not be able to successfully manage our intellectual property or may be subject to infringement claims; we may have to litigate to enforce and protect our intellectual property rights, trade secrets and know-how or to determine their scope, validity or enforceability, which is expensive and could cause a diversion of resources and may not prove successful; we may also be subject to costly litigation in the event our products and technology infringe upon another party’s proprietary rights; we may also be subject to claims by third parties for breach of copyright, trademark or license usage rights; we may lose current and future customers, which could have a material adverse effect on our business, financial condition and results of operations.
Biggest changeSpecific forward-looking statements made herein include: our belief that we cannot predict how future regulations might affect us; our belief that complying with future regulation could be expensive or require us to change the way we operate our business; our belief that our in-house customer service center provides the highest customer service experience for our clients as training is performed on-site by Paysign staff; we may utilize independent contractors who make direct sales and are paid on a commission basis only; our belief that nearly every state would require us to obtain a money transmitter license to operate a money transfer business; our anticipation that we will not pay any cash dividends in the foreseeable future; our intention to retain any earnings to finance the operation and expansion of our business; our intention to continue to make significant investments to maintain the security of our data and cybersecurity infrastructure; our expectation that the trading price for our common stock will be affected by any research or reports that securities analysts publish about us or our business; our belief that our editing processes are consistent with applicable reimbursement rules and industry practice; our belief that all independent contractor and employment agreement relationships are satisfactory; our belief that we have taken appropriate actions to remediate previously reported control deficiencies that we have identified and to strengthen our internal control over financial reporting; our belief that we have utilized proven systems designed for robust data security and integrity in electronic transactions; we may introduce products in the future that would be subject to money transfer and payment instrument licensing regulations; our belief that a data security breach at one of the banks that issue our cards or our third-party service providers could result in significant reputational harm to us and cause the use and acceptance of our cards to decline, either of which could have a significant adverse impact on our operating results and future growth prospects; our belief that our existing competitors have longer operating histories, are substantially larger than we are, may already have or could develop substantially greater financial and other resources than we have, may offer, develop or introduce a wider range of programs and services than we offer or may use more effective advertising and marketing strategies than we do to achieve broader brand recognition, customer awareness and retail penetration; our expectation that we may also face price competition that results in decreases in the purchase and use of our products and services; our expectation that we may have to increase the incentives that we offer to our marketing partners and decrease the prices of our products and services, which could adversely affect our operating results; we may receive a stockholder proposal relating to a variety of ESG issues to public companies in the future; we may be subject to, or contractually required to comply with, state and federal laws that govern various aspects of the submission of healthcare claims for reimbursement and the receipt of payments for healthcare items or services; we may use and disclose individually identifiable health information to perform our services and for other limited purposes, such as creating de-identified information; we may not be able to detect unauthorized use of our intellectual property or proprietary information, or to take enforcement action; we may retain additional employees and consultants during the next twelve months, including additional patient affordability, information technology, product and project management, fraud, and customer care personnel to support our growing businesses; we may be unable to grow our business in future periods, and if our revenue growth slows, or our revenues decline further, our business and financial conditions could be adversely affected; our anticipation that we will experience an inevitable decline in growth rates as our operating revenues increase to higher levels and we may also experience a decline in margins; our anticipation that if our operating revenue growth rates slow materially or decline, our business, operating results and financial condition could be adversely affected; we may have deficiencies or weaknesses in our internal control over financial reporting which could, if not remediated, adversely affect our ability to report our financial condition and results of operations in a timely and accurate manner, decrease investor confidence in our Company, and reduce the value of our common stock; we may face price competition that results in decreases in the purchase and use of our products and services; our belief that to stay competitive , we may have to increase the incentives that we offer to our marketing partners and decrease the prices of our products and services, which could adversely affect our operating results; we may be unable to maintain adequate banking relationships or renew our agreements with the banks that currently issue our cards under terms at least as favorable to us as those existing before renewal; we may not be able to successfully manage our intellectual property or may be subject to infringement claims; we may need to litigate to enforce or protect our intellectual property rights, trade secrets and know-how or to determine their scope, validity or enforceability, which is expensive, may divert resources, and may not be successful; we may be subject to costly litigation in the event our products and technology infringe upon another party’s proprietary rights; we may be subject to claims by third parties for breach of copyright, trademark or license usage rights; we may lose current and future customers, which could have a material adverse effect on our business, financial condition and results of operations; our belief that the measures we have taken to provide reliable service to our clients and cardholders, including the implementation of disaster recovery plans and redundant computer systems, may not be successful, and we may experience other problems unrelated to system failures; we may also experience software defects, development delays and installation difficulties, any of which could harm our business and reputation and expose us to potential liability and increased operating expenses; we may raise capital in order to provide working capital for our expansion into other products and services using our payments platform; we may experience difficulty integrating newly-hired personnel, which could adversely affect our operations; we may not have sufficient personnel for our financial reporting responsibilities, which may result in the untimely close of our books and records and delays in the preparation of financial statements and related disclosures; our belief that future growth in the electronic commerce market will be driven by the cost, convenience, ease of use and quality of products and services offered to consumers and businesses; our belief that our properties are adequate and suitable for us to conduct business in the future; our belief that if we do not raise new capital, we will still be able to support our existing business and expand into new vertical markets using internally generated funds; our plan for 2026 to continue to invest additional funds in technology improvements, sales and marketing, cybersecurity, fraud, customer service, and regulatory compliance; our belief that gross dollar volume loaded on cards and conversion rates on gross dollar volume loaded on cards are the primary indicators of our quarterly and annual revenues our belief that our available cash on hand, excluding restricted cash, along with our forecast for revenues and cash flows for the remainder of 2026 and through 2028, will be sufficient to sustain our operations for the next twenty-four months; our belief that we do not anticipate any losses with respect to accounts with balances exceeding federally insured limits; our expectation that the repurchase program will be completed within 36 months from the commencement date; our expectation that we will be entitled to a breakage amount in certain card programs where we hold the cardholder funds; our belief that our platform can be seamlessly integrated with our clients’ systems; we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business; if a financial institution were to be placed into receivership, we may be unable to access the cash we have on deposit; our belief that our distinctive positioning allows us to provide end-to end technologies that securely manage transaction processing, cardholder enrollment, value loading, account management, data and analytics and customer service; our belief that our architecture is known for its cross-platform compatibility, flexibility, and scalability – allowing our clients and partners to leverage these advantages for cost savings and revenue opportunities; and our expectation that IRC Sections 382 and 383 will not significantly impact the utilization of its net operating losses and other tax carryforwards.
Actual results could differ from those estimates. Our estimates will be based on our experience and our interpretation of economic, political, regulatory, and other factors that affect our business prospects. Intangible Assets – For intangible assets, the Company recognizes an impairment loss if the carrying amount of the intangible asset is not recoverable and exceeds fair value.
Actual results could differ from those estimates. Our estimates will be based on our experience and our interpretation of economic, political, regulatory, and other factors that affect our business prospects. Intangible Assets – For intangible assets, the Company recognizes an impairment loss if the carrying amount of the intangible asset is not recoverable and exceeds its fair value.
The overall change in net income relates to the aforementioned factors. 30 Key Metrics, Performance Indicators and Non-GAAP Measures Management reviews a number of metrics to help us monitor the performance of and identify trends affecting our business.
The overall change in net income relates to the aforementioned factors. Key Metrics, Performance Indicators and Non-GAAP Measures Management reviews a number of metrics to help us monitor the performance of and identify trends affecting our business.
Restricted-loop cards can be used at several merchants, or a defined group of merchants, such as all merchants at a specific shopping mall. 27 The prepaid card market in the United States has experienced significant growth in recent years due to consumers and merchants embracing improved technology, greater convenience, more product choices and greater flexibility.
Restricted-loop cards can be used at several merchants, or a defined group of merchants, such as all merchants at a specific shopping mall. 28 The prepaid card market in the United States has experienced significant growth in recent years due to consumers and merchants embracing improved technology, greater convenience, more product choices and greater flexibility.
You should refer to and carefully review the information in future documents we file with the SEC. 26 Overview Paysign, Inc. (the “Company,” “Paysign,” “we” or “our”), headquartered in Nevada, was incorporated on August 24, 1995, and trades under the symbol PAYS on The Nasdaq Stock Market LLC.
You should refer to and carefully review the information in future documents we file with the SEC. 27 Overview Paysign, Inc. (the “Company,” “Paysign,” “we” or “our”), headquartered in Nevada, was incorporated on August 24, 1995, and trades under the symbol PAYS on The Nasdaq Stock Market LLC.
We are a vertically integrated provider of prepaid card products and processing services for corporate, consumer and government applications. Our payment solutions are utilized by our corporate customers as a means to increase customer loyalty, increase patient adherence rates, reduce administration costs and streamline operations.
We are a vertically integrated provider of prepaid card products and processing services for corporate, consumer and government entities. Our payment solutions are utilized by our corporate customers as a means to increase customer loyalty, increase patient adherence rates, reduce administration costs and streamline operations.
In 2025, we plan to continue to invest additional funds in technology improvements, sales and marketing, cybersecurity, fraud, customer service, and regulatory compliance. From time to time, we evaluate raising capital to enable us to diversify into new market verticals.
In 2026, we plan to continue to invest additional funds in technology improvements, sales and marketing, cybersecurity, fraud, customer service and regulatory compliance. From time to time, we evaluate raising capital to enable us to diversify into new market verticals.
We operate on a powerful, high-availability payments platform with cutting-edge fintech capabilities that can be seamlessly integrated with our clients’ systems. This distinctive positioning allows us to provide end-to-end technologies that securely manage transaction processing, cardholder enrollment, value loading, account management, data and analytics, and customer service.
We operate on a powerful, high-availability payment solutions platform with cutting-edge fintech capabilities that can be seamlessly integrated with our clients’ systems. This distinctive positioning allows us to provide end-to-end technologies that securely manage transaction processing, cardholder enrollment, value loading, account management, data and analytics and customer service.
Our suite of product offerings includes solutions for corporate rewards, prepaid gift cards, general purpose reloadable debit cards, employee incentives, consumer rebates, donor compensation, clinical trials, healthcare reimbursement payments and pharmaceutical payment assistance, and demand deposit accounts accessible with a debit card. Our cards are sponsored by our issuing bank partners.
Our suite of product offerings includes solutions for corporate rewards, prepaid gift cards, general purpose reloadable debit cards, employee incentives, consumer rebates, donor compensation, clinical trials, healthcare reimbursement payments and pharmaceutical payment assistance, demand deposit accounts accessible with a debit card and software solutions targeting blood and plasma collection organizations. Our cards are sponsored by our issuing bank partners.
The increase in gross profit was offset by increased costs from third-party service providers, sales commission expense, customer service costs and fraud expenses mentioned above, primarily driven by the overall growth in our business.
The increase in gross profit was offset by increased costs from network fees, third-party service providers, sales commission expense and customer service costs mentioned above, primarily driven by the overall growth in our business.
Our net income conversion rates for the year ended December 31, 2024 and 2023 were 0.21% or 21 bps, and 0.38% or 38 bps, respectively, of gross dollar volume loaded on cards. Management also reviews key performance indicators, such as revenues, gross profit, operational expenses as a percent of revenues, and cardholder participation.
Our net income conversion rates for the years ended December 31, 2025 and 2024 were 0.39% or 39 bps, and 0.21% or 21 bps, respectively, of gross dollar volume loaded on cards. Management also reviews key performance indicators, such as revenues, gross profit, operational expenses as a percent of revenues, and cardholder participation.
Both reloadable and non-reloadable cards may be open-loop, closed-loop, or restricted-loop. Open-loop cards can be used to receive cash at ATM locations by PIN; or purchase goods or services by PIN or signature at retail locations virtually anywhere that the network brand (American Express, Discover, Mastercard, Visa, etc.) is accepted. Closed-loop cards can only be used at a specific merchant.
Open-loop cards can be used to receive cash at ATM locations by PIN; or purchase goods or services by PIN or signature at retail locations virtually anywhere that the network brand (American Express, Discover, Mastercard, Visa, etc.) is accepted. Closed-loop cards can only be used at a specific merchant.
We believe the following measures are the primary indicators of our quarterly and annual revenues: Gross Dollar Volume Loaded on Cards: Represents the total dollar volume of funds loaded to all of our prepaid card programs. Our gross dollar volume loaded on cards was $1,783 million and $1,706 million for the year ended December 31, 2024 and 2023, respectively.
We believe the following measures are the primary indicators of our quarterly and annual revenues: Gross Dollar Volume Loaded on Cards: Represents the total dollar volume of funds loaded to all of our prepaid card programs. Our gross dollar volume loaded on cards was $1,935 million and $1,783 million for the years ended December 31, 2025 and 2024, respectively.
Plasma and pharma card program revenues include both fixed and variable components. Cardholder fees represent an obligation to the cardholder based on a per transaction basis and are recognized at a point in time when the performance obligation is fulfilled.
Plasma and pharma program revenues include both fixed and variable components. Cardholder fees represent an obligation to the cardholder based on a per transaction basis and are recognized at a point in time when the performance obligation is fulfilled. Card program management fees and transaction claims processing fees represent obligations to our program sponsors.
The increase in depreciation and amortization expense was primarily due to continued capitalization of new software development costs and equipment purchases related to continued enhancements to our processing platform and employment growth.
The increase in depreciation and amortization expense was primarily due to continued capitalization of new software development costs, equipment purchases related to continued enhancements to our processing platform and employment growth and the amortization of intangible assets from our Gamma acquisition.
The changes in accounts receivable, accounts payable, and customer card funding are primarily related to the growth in our pharma patient affordability business and timing of payments as we are invoiced by third-party service providers at the end of the period and are due monies from our pharma patient affordability customers to cover these third-party payables.
The changes in accounts receivable, accounts payable and customer card funding, a net increase of $18,475,867, are primarily related to the growth in our pharma patient affordability business and timing of pass-through payments as we are invoiced by third-party service providers at the end of the period and are due monies from our pharma patient affordability customers to cover these third-party payables.
Gross profit also benefited from our plasma revenue and the beneficial impact of a variable cost structure, as many of the plasma transaction costs are variable in nature and are provided by third-parties who charge us based on the number of active cards outstanding and transactions that occurred during the period.
Gross profit also benefited from the addition of 115 net plasma centers during the past 12 months, and corresponding revenue and beneficial impact of a variable cost structure, as many of the plasma transaction costs are variable in nature and are provided by third parties who charge us based on the number of active cards outstanding and transactions that occurred during the period.
Cost of revenues is comprised of transaction processing fees, data connectivity and data center expenses, network fees, bank fees, card production and postage costs, customer service, program management, application integration setup, and sales and commission expense.
Cost of revenues is comprised of transaction processing fees, data connectivity and data center expenses, network fees, bank fees, card production and postage costs, call center support, application integration setup and sales and commission expense.
The Company generates revenues from plasma card programs through fees generated from cardholder fees and interchange fees. Revenues from pharma card programs are generated through card program management fees, transaction claims processing fees, interchange fees, and settlement income. Other revenues are generated through cardholder fees, interchange fees, program management fees, load fees and breakage.
The Company generates revenues from plasma card programs through fees generated from cardholders and interchange fees. Revenues from pharma card programs are generated through card program management fees, transaction claim processing fees, interchange fees, customer service fees, other billable service fees and settlement income. Other revenues are generated through cardholder fees, interchange fees, program management fees, load fees and breakage.
Breakage is recorded ratably over the estimated card life based on historical redemption patterns, market-specific trends, escheatment rules, and existing economic conditions and relates solely to our open-loop gift card business which began at the end of 2022.
Breakage is recorded ratably over the estimated card life based on historical redemption patterns, market-specific trends, escheatment rules, and existing economic conditions and relates solely to our open-loop gift card business which began at the end of 2022. Settlement income is recorded at the expiration of the card or card program and relates primarily to our corporate incentive programs.
Internally Developed Software Costs – Computer software development costs are expensed as incurred, except for internal use software or website development costs that qualify for capitalization as described below, and include compensation and related expenses, costs of hardware and software, and costs incurred in developing features and functionality.
Internally Developed Software Costs – Computer software development costs are expensed as incurred, except for internal use software or website development costs that qualify for capitalization as described below, and include compensation and related expenses, costs of hardware and software, and costs incurred in developing features and functionality. 34 For computer software developed or obtained for internal use, costs that are incurred in the preliminary project and post implementation stages of software development are expensed as incurred.
Our total revenue conversion rates for the years ended December 31, 2024 and 2023 were 3.27% or 327 basis points (“bps”), and 2.77% or 277 bps, respectively, of gross dollar volume loaded on cards.
Our total revenue conversion rates for the years ended December 31, 2025 and 2024 were 4.24% or 424 basis points (“bps”), and 3.27% or 327 bps, respectively, of gross dollar volume loaded on cards.
Year ended December 31, (As a percentage of revenue) 2024 2023 Reconciliation of adjusted EBITDA margin to net income margin: Net income margin 6.5% 13.7% Income tax provision (benefit) 0.6% (8.7% ) Interest income, net (5.3% ) (5.4% ) Depreciation and amortization 10.3% 8.5% EBITDA margin 12.0% 8.2% Stock-based compensation 4.5% 6.0% Adjusted EBITDA margin 16.5% 14.2% Liquidity and Capital Resources The following table sets forth the major sources and uses of cash for our last two fiscal years ended December 31, 2024 and 2023: Year ended December 31, 2024 2023 Net cash provided by operating activities $ 22,947,120 $ 27,620,624 Net cash used in investing activities (9,488,702 ) (7,048,678 ) Net cash used in financing activities (466,245 ) (1,118,284 ) Net increase in cash and restricted cash $ 12,992,173 $ 19,453,662 Comparison of Fiscal 2024 and 2023 During the years ended December 31, 2024 and 2023, we financed our operations through internally generated funds.
Year ended December 31, (As a percentage of revenue) 2025 2024 Reconciliation of adjusted EBITDA margin to net income margin: Net income margin 9.2 % 6.5 % Income tax provision 3.0 % 0.6 % Interest income, net (3.3 %) (5.3 %) Depreciation and amortization 10.1 % 10.3 % EBITDA margin 19.1 % 12.0 % Stock-based compensation 5.2 % 4.5 % Adjusted EBITDA margin 24.3 % 16.5 % Liquidity and Capital Resources The following table sets forth the major sources and uses of cash for our last two fiscal years ended December 31, 2025 and 2024: Year ended December 31, 2025 2024 Net cash provided by operating activities $ 52,450,867 $ 22,947,120 Net cash used in investing activities (10,094,210 ) (9,488,702 ) Net cash provided by (used in) financing activities 284,868 (466,245 ) Net increase in cash and restricted cash $ 42,641,525 $ 12,992,173 Comparison of Fiscal 2025 and 2024 During the years ended December 31, 2025 and 2024, we financed our operations through internally generated funds.
The increase in other revenue was primarily due to the growth and usage in the number of cardholders of our payroll, retail, and corporate incentive programs. 29 Cost of revenues for the year ended December 31, 2024 increased $3,049,221 compared to the same period in the prior year.
The increase in other revenue was primarily due to the growth and usage in the number of cardholders of our payroll, retail and corporate incentive programs. 30 Cost of revenues for the year ended December 31, 2025 increased $7,124,005 compared to the same period in the prior year.
At December 31, 2024, our income tax provision was $322,290, which equates to an effective tax rate of 7.8% primarily as a result of federal taxes offset by net operating loss true-up on our state taxes, tax benefits related to our stock-based compensation and changes to the Company’s tax credits.
At December 31, 2024, our income tax provision was $322,290, which equates to an effective tax rate of 7.8% primarily as a result of federal taxes offset by net operating loss true-up on our state taxes, tax benefits related to our stock-based compensation and changes to our tax credits. 31 The net income for the year ended December 31, 2025 was $7,551,613, an improvement of $3,735,706 compared to the net income of $3,815,907 for the year ended December 31, 2024.
Our total gross profit conversion rates for the year ended December 31, 2024 and 2023 were 1.81% or 181 bps, and 1.41% or 141 bps, respectively, of gross dollar volume loaded on cards.
Our total gross profit conversion rates for the years ended December 31, 2025 and 2024 were 2.52% or 252 bps, and 1.81% or 181 bps, respectively, of gross dollar volume loaded on cards.
Capitalized costs are amortized using the straight-line method over a three-year estimated useful life, beginning in the period in which the software is available for use. 33 Income Taxes – Income tax expense is comprised of current and deferred income tax expense. Current income tax expense approximates taxes to be paid or refunded for the current period.
Costs incurred during the application and development stage are capitalized. Capitalized costs are amortized using the straight-line method over a three year estimated useful life, beginning in the period in which the software is available for use. Income Taxes – Income tax expense is comprised of current and deferred income tax expense.
For additional information regarding our cash commitments and contractual obligations, see “Note 5 – LEASE” in the notes to the accompanying consolidated financial statements. Liquidity and Sources of Financing Unrestricted cash was $10,766,982 as of December 31, 2024, a decrease of $6,227,723 compared to the same period in the prior year.
For additional information regarding our cash commitments and contractual obligations, see “Note 6 – LEASE” in the notes to the accompanying consolidated financial statements. Liquidity and Sources of Financing Unrestricted cash was $21,067,651 as of December 31, 2025, an increase of $10,300,669 compared to the same period in the prior year.
For the year ended December 31, 2024, we recorded income from operations of $1,021,508 representing an improvement of $1,188,763 compared to a loss from operations of $167,255 during the same period in the prior year, related to the aforementioned factors.
For the year ended December 31, 2025, we recorded income from operations of $7,362,839 representing an improvement of $6,341,311 compared to income from operations of $1,021,508 during the same period in the prior year related to the aforementioned factors.
Year ended December 31, 2024 2023 Reconciliation of adjusted EBITDA to net income: Net income $ 3,815,907 $ 6,458,727 Income tax provision (benefit) 322,290 (4,094,911 ) Interest income, net (3,116,689 ) (2,531,071 ) Depreciation and amortization 5,994,986 4,026,578 EBITDA 7,016,494 3,859,323 Stock-based compensation 2,604,589 2,853,643 Adjusted EBITDA $ 9,621,083 $ 6,712,966 31 “EBITDA margin” is defined as earnings before interest, income taxes, depreciation and amortization expense as a percentage of the Company’s revenue and “Adjusted EBITDA margin” reflects the adjustment to EBITDA margin to exclude stock-based compensation expense as a percentage of revenue.
Year ended December 31, 2025 2024 Reconciliation of adjusted EBITDA to net income: Net income $ 7,551,613 $ 3,815,907 Income tax provision 2,481,641 322,290 Interest income, net (2,670,415 ) (3,116,689 ) Depreciation and amortization 8,318,797 5,994,986 EBITDA 15,681,636 7,016,494 Stock-based compensation 4,262,058 2,604,589 Adjusted EBITDA $ 19,943,694 $ 9,621,083 32 “EBITDA margin” is defined as earnings before interest, income taxes, depreciation and amortization expense as a percentage of the Company’s revenue and “Adjusted EBITDA margin” reflects the adjustment to EBITDA margin to exclude stock-based compensation expense as a percentage of revenue.
The carrying amount of the intangible asset is considered not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use of the asset. Intangible assets with a finite life are amortized on a straight-line basis over its estimated useful life, which is generally 3 to 15 years.
The carrying amount of the intangible asset is considered not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use of the asset. Intangible assets with an indefinite-life are not amortized.
Non-Reloadable Cards: These are generally one-time use cards that are only active until the funds initially loaded to the card are spent. These types of cards are generally used as gift or incentive cards. Typically, these types of cards are used for the purchase of goods or services at retail locations and cannot be used to receive cash.
These types of cards are generally used as gift or incentive cards. Typically, these types of cards are used for the purchase of goods or services at retail locations and cannot be used to receive cash. Both reloadable and non-reloadable cards may be open-loop, closed-loop or restricted-loop.
Cash used for investing activities was primarily attributed to an increase in the capitalization of internally developed software as we continue to invest in our technology platform. 32 Cash used in financing activities of $466,245 and $1,118,284 for the years ended December 31, 2024 and 2023, respectively, was primarily attributed to the repurchase of 136,700 shares of the Company’s common stock at a weighted average price of $3.62 per share during the year ended December 31, 2024 offset by proceeds received of $28,800 for the exercise of stock options.
For the year ended December 31, 2024, $9,488,702 of cash was used for investing activities primarily attributable to an increase in software licenses, fixed assets and capitalization of internally developed software as we continue to invest in our technology platform. 33 Cash provided by financing activities of $284,868 for the year ended December 31, 2025 was primarily attributed to proceeds from the exercise of options of $660,654, partially offset by the repurchase of 100,000 shares of the Company’s common stock at a weighted average price of $3.76 per share.
The Company is currently under no obligation to refund any fees, and the Company does not currently have any obligations for disputed claim settlements Cost of revenues is comprised of transaction processing fees, data connectivity and data center expenses, network fees, bank fees, card production and postage costs, customer service, program management, application integration setup, fraud charges, and sales and commission expense.
Cost of revenues is comprised of transaction processing fees, data connectivity and data center expenses, network fees, bank fees, card production and postage costs, customer service, program management, application integration setup, fraud charges and sales and commission expense. Stock-Based Compensation – The Company recognizes compensation expense for all restricted stock awards and stock options.
The increase in pharma revenue was primarily due a full year financial benefit of programs launched in 2023, the launch of 33 net new pharma patient affordability programs since December 31, 2023 and the subsequent growth in monthly management and setup fees, claim processing fees, and other billable services such as call center support.
The increase in pharma revenue was primarily due to the financial benefit of 55 net pharma patient affordability programs launched during the past 12 months, and a corresponding increase in monthly management fees, setup fees, claim processing fees and other billable services such as dynamic business rules and call center support.
These increases were offset by a decline in plastics and collateral of approximately $326,000 and a decline in other costs of approximately $35,000.
These increases were offset by a decrease in other costs of approximately $45,000.
For the year ended December 31, 2023, the repurchase of 394,558 shares of the Company’s common stock at a weighted average price of $2.86 per share offset by proceeds received of $9,600 for the exercise of stock options. Our significant contractual cash requirements also include ongoing payments for lease liabilities.
Finance activities during the year ended December 31, 2024 used $466,245 in cash, attributable to the repurchase of 136,700 shares of the Company’s common stock at a weighted average price of $3.62 per share offset by proceeds of $28,800 for the exercise of stock options. Our significant contractual cash requirements also include ongoing payments for lease liabilities.
We believe that our available cash on hand, excluding restricted cash, at December 31, 2024 of $10,766,982, along with our forecast for revenues and cash flows for 2025 and through 2027, will be sufficient to sustain our operations for the next 24 months.
The increase resulted primarily from the improvement in our operating results. We believe that our available cash on hand, excluding restricted cash, at December 31, 2025 of $21,067,651, along with our forecast for revenues and cash flows for the remainder of 2026 and through 2028, will be sufficient to sustain our operations for the next twenty-four months.
Gross profit for the year ended December 31, 2024 increased $8,061,169 compared to the same period in the prior year, resulting primarily from the increase in the number of pharma patient affordability programs, a full year financial benefit of programs launched in 2023, and a corresponding increase in setup fees, monthly management fees, claim processing fees, and other billable fees associated with our patient affordability programs.
Gross profit for the year ended December 31, 2025 increased $16,519,619 compared to the same period in the prior year resulting primarily from the launch of an additional 55 net pharma patient affordability programs during the prior 12 months, and a corresponding increase in setup fees, monthly management fees, claim processing fees and other billable fees.
Deferred income tax expense results from the changes in deferred tax assets and liabilities during the periods.
Current income tax expense approximates taxes to be paid or refunded for the current period. Deferred income tax expense results from the changes in deferred tax assets and liabilities during the periods.
Disclosure Regarding Forward-Looking Statements This Annual Report on Form 10-K includes forward looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (“Forward-Looking Statements”).
Factors that could cause or contribute to such differences include, but are not limited to, those identified below and those discussed in “Risk Factors” included elsewhere in this Form 10-K. 26 Disclosure Regarding Forward-Looking Statements This Annual Report on Form 10-K includes forward looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (“Forward-Looking Statements”).
GPR cards can also be issued to a consumer at a retail location or mailed to a consumer after completing an on-line application. GPR cards can be reloaded multiple times with a consumer’s payroll, government benefit, a federal or state tax refund or through cash reload networks located at retail locations. Reloadable cards are generally open-loop cards as described below.
GPR cards can be reloaded multiple times with a consumer’s payroll, government benefit, a federal or state tax refund or through cash reload networks located at retail locations. Reloadable cards are generally open-loop cards as described below. Non-Reloadable Cards: These are generally one-time use cards that are only active until the funds initially loaded to the card are spent.
The Company uses the output method to recognize card program management fee revenue at the amount of consideration to which an entity has a right to invoice. The performance obligation is satisfied when the services are transferred to the customer which the Company determined to be monthly, as the customer simultaneously receives and consumes the benefit from the Company’s performance.
The performance obligation is satisfied when the services are transferred to the customer which the Company determined to be monthly, as the customer simultaneously receives and consumes the benefit from the Company’s performance.
The increase in cost of revenues consisted primarily of (i) increased network fees of approximately $1,026,000, which was driven predominantly by increased ATM network usage associated with growth in our card programs and increases in transaction fees related to inflationary pressures; (ii) increased customer care expense of approximately $838,000 associated primarily with the growth in our pharma patient affordability programs, wage inflation pressures, a tight labor market, and increased benefit costs; (iii) increased third-party program management of approximately $651,000 associated with our pharma patient affordability programs; (iv) increased sales commission expense of approximately $368,000 related to the increase in overall revenue for programs in which we pay commission expenses; and (v) increased fraud charges of approximately $527,000.
The increase in cost of revenues consisted primarily of (i) increased call center support expense of approximately $2,089,000 associated primarily with the growth in our plasma and pharma patient affordability businesses, a new customer service contact center, wage inflation pressures, a tight labor market and increased benefit costs; (ii) increased sales and commission expense of approximately $852,000 related to the increase in overall revenue for programs in which we pay commission expenses; (iii) increased network and network related fees of approximately $2,845,000 associated to the addition of 115 net plasma centers; (iv) increased third-party variable costs of approximately $1,063,000 associated with our pharma patient affordability programs; and (v) increased plastics, collateral and postage of approximately $320,000.
The Company uses the right to invoice practical expedient and recognizes interchange fee revenue concurrent with the processing of card transactions. Interchange fees are settled in accordance with the card payment network terms and conditions, which is typically within a few days.
The Company uses the right to invoice practical expedient and recognizes interchange fee revenue concurrent with the processing of card transactions.
If we do not raise new capital, we believe that we will still be able to support our existing business and expand into new vertical markets using internally generated funds. 2024 Year Milestones · Grew to approximately 7.3 million cardholders and approximately 600 card programs as of December 31, 2024. · Year over year revenue increased 23.5%. · Added 16 net new plasma programs, launched 33 net new pharma programs, and added 1 net new other prepaid program. 28 Results of Operations Comparison of Year Ended December 31, 2024 to Year Ended December 31, 2023 The following table summarizes our consolidated financial results for year ended December 31, 2024 in comparison to year ended December 31, 2023: Year ended December 31, Variance 2024 2023 $ % Revenues Plasma industry $ 43,879,508 $ 41,951,659 $ 1,927,849 4.6% Pharma industry 12,652,412 4,051,037 8,601,375 212.3% Other 1,852,632 1,271,466 581,166 45.7% Total revenues 58,384,552 47,274,162 11,110,390 23.5% Cost of revenues 26,187,218 23,137,997 3,049,221 13.2% Gross profit 32,197,334 24,136,165 8,061,169 33.4% Gross margin % 55.1% 51.1% Operating expenses Selling, general and administrative 25,180,840 20,276,842 4,903,998 24.2% Depreciation and amortization 5,994,986 4,026,578 1,968,408 48.9% Total operating expenses 31,175,826 24,303,420 6,872,406 28.3% Income (loss) from operations $ 1,021,508 $ (167,255 ) $ 1,188,763 NM Other income $ 3,116,689 $ 2,531,071 $ 585,618 23.1% Income tax provision (benefit) $ 322,290 $ (4,094,911 ) $ 4,417,201 NM Net income $ 3,815,907 $ 6,458,727 $ (2,642,820 ) (40.9% ) Net margin % 6.5% 13.7% The increase in total revenues of $11,110,390 for the year ended December 31, 2024 compared to the same period in the prior year consisted primarily of a $1,927,849 increase in plasma revenue, a $8,601,375 increase in pharma revenue, and a $581,166 increase in other revenue.
If we do not raise new capital, we believe that we will still be able to support our existing business and expand into new vertical markets using internally generated funds. 2025 Year Milestones · Grew to approximately 8.4 million cardholders and approximately 670 card programs as of December 31, 2025. · Year over year revenue increased 40.5%. · Gamma Innovation LLC acquisition. · Added 115 net plasma programs, launched 55 net new pharma programs, and added 3 net new other prepaid programs. 29 Results of Operations Comparison of Year Ended December 31, 2025 to Year Ended December 31, 2024 The following table summarizes our consolidated financial results for year ended December 31, 2025 in comparison to year ended December 31, 2024: Year ended December 31, Variance 2025 2024 $ % Revenues Plasma industry $ 45,615,640 $ 43,879,508 $ 1,736,132 4.0 % Pharma industry 33,888,631 12,652,412 21,236,219 167.8 % Other 2,523,905 1,852,632 671,273 36.2 % Total revenues 82,028,176 58,384,552 23,643,624 40.5 % Cost of revenues 33,311,223 26,187,218 7,124,005 27.2 % Gross profit 48,716,953 32,197,334 16,519,619 51.3 % Gross margin % 59.4 % 55.1 % Operating expenses Selling, general and administrative 33,035,317 25,180,840 7,854,477 31.2 % Depreciation and amortization 8,318,797 5,994,986 2,323,811 38.8 % Total operating expenses 41,354,114 31,175,826 10,178,288 32.6 % Income from operations $ 7,362,839 $ 1,021,508 $ 6,341,331 620.8 % Other income $ 2,670,415 $ 3,116,689 $ (446,274 ) (14.3 %) Income tax provision $ 2,481,641 $ 322,290 $ 2,159,351 670.0 % Net income $ 7,551,613 $ 3,815,907 $ 3,735,706 97.9 % Net margin % 9.2 % 6.5 % The increase in total revenues of $23,643,624 for the year ended December 31, 2025 compared to the same period in the prior year consisted primarily of a $1,736,132 increase in plasma revenue, a $21,236,219 increase in pharma revenue, and a $671,273 increase in other revenue.
For each program, we utilize a third party to estimate breakage rates based on historical redemption patterns, market-specific trends, escheatment rules and existing economic conditions.
For each program, we utilize a third party to estimate breakage rates based on historical redemption patterns, market-specific trends, escheatment rules and existing economic conditions. The Company accounts for breakage in accordance with Accounting Standards Update (“ASU”) 2016-04, Liabilities—Extinguishment of Liabilities (Subtopic 405-20): Recognition of Breakage for Certain Prepaid Stored-Value Cards for the recognition of such revenue.
This increase was offset by a decrease in stock compensation of approximately $249,000, an increase of $1,738,000 in the amount of capitalized platform development costs, and a decrease in other cost of approximately $23,000. Depreciation and amortization expense for the year ended December 31, 2024 increased $1,968,408 compared to the same period in the prior year.
The rise in costs was offset by a reduction in other operating expenses of approximately $92,000. Depreciation and amortization expense for the year ended December 31, 2025 increased $2,323,811 compared to the same period in the prior year.
The portion of the dollar value of prepaid-stored value cards that consumers do not ultimately redeem are referred to as breakage.
Interchange fees are settled in accordance with the card payment network terms and conditions, which is typically within a few days. 35 The portion of the dollar value of prepaid-stored value cards that consumers do not ultimately redeem are referred to as breakage.
Reloadable Cards: These types of cards are generally classified as payroll or considered general purpose reloadable (“GPR”) cards. Payroll cards are issued by an employer to an employee in order to allow the employee to access payroll amounts that are deposited into an account linked to their card.
Payroll cards are issued by an employer to an employee in order to allow the employee to access payroll amounts that are deposited into an account linked to their card. GPR cards can also be issued to a consumer at a retail location or mailed to a consumer after completing an on-line application.
Operating activities provided $22,947,120 of cash in 2024, a decrease of $4,673,504 compared to 2023. This change in cash flow compared to the prior period is primarily due to net decreases in operating assets and liabilities and net income.
Operating activities provided $52,450,867 of cash as of December 31, 2025, an increase of $29,503,747 compared to same period in the prior year. This change in cash flow compared to the change in cash flow in the prior period is primarily due to net increase in operating assets and liabilities.
Selling, general and administrative expenses for the year ended December 31, 2024 increased $4,903,998 compared to the same period in the prior year and consisted primarily of an increase in (i) compensation and benefits of approximately $5,388,000 due to continued hiring to support the Company’s growth primarily from our pharma patient affordability business, a tight labor market, and increased benefit costs; (ii) technologies and telecom of approximately $1,320,000 primarily related to ongoing platform security investments; and (iii) travel and entertainment of approximately $207,000.
Selling, general and administrative expenses for the year ended December 31, 2025 increased $7,854,477 compared to the same period in the prior year and consisted primarily of an increase in (i) compensation and benefits of approximately $3,766,000 due to continued hiring to support our growth, a tight labor market, and increased benefit costs; (ii) stock-based compensation of approximately $1,657,000 related to the issuance of restricted stock units for new hires and employee retention; (iii) technologies and telecom expense of approximately $833,000 primarily related to ongoing platform security investments; (iv) general expenses of approximately $241,000 primarily related to conferences, deliveries, and employee education; (v) acquisition costs of approximately $121,000 associated with the Gamma Innovation LLC (“Gamma”) acquisition that closed on March 19, 2025 (see “Note 3- ACQUISITION” in the notes to the accompanying consolidated financial statements) ; (vi) travel and entertainment of approximately $272,000; and (vii) a decrease in capitalized platform development costs of approximately $1,056,000.
The Company accounts for breakage in accordance with Accounting Standards Update (“ASU”) 2016-04, Liabilities—Extinguishment of Liabilities (Subtopic 405-20): Recognition of Breakage for Certain Prepaid Stored-Value Cards for the recognition of such revenue. 34 The Company utilizes the remote method of revenue recognition for settlement income whereby the unspent balances will be recognized as revenue at the expiration of the cards or the respective card program.
The Company utilizes the remote method of revenue recognition for settlement income whereby the unspent card balances will be recognized as revenue at the expiration of the cards or the respective card program. The Company records all revenue on a gross basis since it is the primary obligor and establishes the price in the contract arrangement with its customers.
In light of the elevated interest rates and increased refinancing risks related to commercial real estate holdings on bank balance sheets, we continue to monitor the health and soundness of our bank relationships through publicly available information.
In light of the recent bank failures, we continue to monitor the health and soundness of our bank relationships through publicly available information. Based on recent SEC filings, we have not discovered any issues that would cause us to alter our bank relationships.
The number of claims processed increased over 270% in 2024 compared to 2023.
For the year ended December 31, 2025 the number of claims processed increased 79% compared to the same period in the prior year.
Changes in net income in 2024 when compared to 2023 are also driven by a net decrease in our deferred tax asset valuation. The decrease in cash flows from operating activities and net income was offset by non-cash adjustments for deferred income taxes, depreciation and amortization, stock-based compensation, and lease expense.
The increase in cash flows from operating activities was also attributed to an increase in net income, reduced prepaid expenses, collection of tax credits and non-cash adjustments for depreciation and amortization, deferred income tax, and stock-based compensation. We used net cash in investing activities during the year ended December 31, 2025 and 2024 of $10,094,210 and $9,488,702, respectively.
Card program management fees and transaction claims processing fees include an obligation to our card program sponsors and are generally recognized when earned on a monthly basis and are typically due within 30 days pursuant to the contract terms which are generally multi-year contracts.
These fees are generally recognized as revenue when earned on a monthly basis and are typically payable according to the terms outlined in the contract. The Company uses the output method to recognize card program management fee revenue at the amount of consideration to which an entity has a right to invoice.
Removed
Our actual results could differ materially from those discussed below. Factors that could cause or contribute to such differences include, but are not limited to, those identified below and those discussed in “Risk Factors” included elsewhere in this Form 10-K.
Added
Our actual results could differ materially from those discussed below.
Removed
The electronic commerce industry is changing rapidly; we may experience other problems unrelated to system failures; we may also experience software defects, development delays and installation difficulties, any of which could harm our business and reputation and expose us to potential liability and increased operating expenses; we may raise capital in order to provide working capital for our expansion into other products and services using our payments platform; we may not be able to retain our current key employees; we may experience difficulty fully integrating our newly-hired personnel, which may adversely affect our business; we may not have sufficient personnel for our financial reporting responsibilities, which may result in the untimely close of our books and records and delays in the preparation of financial statements and related disclosures; our belief that future growth in the electronic commerce market will be driven by the cost, convenience, ease of use and quality of products and services offered to consumers and businesses; our belief that risks from prior cybersecurity threats, including as a result of any previous cybersecurity incidents, have not materially affected our business to date; our belief that our properties are adequate and suitable for us to conduct business in the future; our belief that if we do not raise new capital, we will still be able to support our existing business and expand into new vertical markets using internally generated funds; our plan for 2025 to continue to invest additional funds in technology improvements, sales and marketing, cybersecurity, fraud, customer service, and regulatory compliance; our belief that the following measures are the primary indicators of our quarterly and annual revenues: gross dollar volume loaded on cards and conversion rates on gross dollar volume loaded on cards; our belief that the following are also key performance indicators: revenues, gross profit, operational expenses as a percent of revenues, cardholder participation, and EBITDA; our belief that our available cash on hand, excluding restricted cash, along with our forecast for revenues and cash flows for 2025 and through 2027, will be sufficient to sustain our operations for the next 24 months. our belief that we do not anticipate any losses with respect to accounts with balances exceeding federally insured limits; our expectation that the repurchase program will be completed within 36 months from the commencement dated; our expectation that we are entitled to a breakage amount in certain card programs where we hold the cardholder funds; our belief that our platform can be seamlessly integrated with our clients’ systems; we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business; if a financial institution were to be placed into receivership, we may be unable to access the cash we have on deposit; our belief that our distinctive positioning allows us to provide end-to end technologies that securely manage transaction processing, cardholder enrollment, value loading, account management, data and analytics, and customer service; our belief that our architecture is known for its cross-platform compatibility, flexibility, and scalability – allowing our clients and partners to leverage these advantages for cost savings and revenue opportunities; our belief that if we do not raise new capital, then we will still be able to support our existing business and expand into new vertical markets using internally generated funds; our expectation that IRC Sections 382 and 383 will significantly impact the utilization of its net operating losses and other tax carryforwards.
Added
In addition to our payment solutions, we also offer life science technology solutions targeting blood and plasma collection organizations. These software solutions are marketed under the Apherion™ brand, and we derive our revenue from licensing, hosting and consulting fees.
Removed
Settlement income is recorded at the expiration of the card or card program and relates predominantly to our pharma prepaid business which ended in 2022. We have two categories for our prepaid debit cards: (1) corporate and consumer reloadable cards, and (2) non-reloadable cards.
Added
The industry generally has two categories for our prepaid debit cards: (1) corporate and consumer reloadable cards and (2) non-reloadable cards. Reloadable Cards: These types of cards are generally classified as payroll or considered general purpose reloadable (“GPR”) cards.
Removed
The increase in plasma revenue was primarily due to the addition of 16 net new plasma centers since December 31, 2023 and rise in the number of donations at existing plasma centers, and, consequently, dollars loaded to cards, cardholder fees, and interchange, as there continues to be stable demand for plasma used in plasma protein therapies.
Added
The increase in plasma revenue was primarily due to 115 net plasma centers added during the past 12 months offset by a decline in plasma donations and dollars loaded to cards as plasma inventory levels were elevated throughout much of 2025, which has reduced our average monthly revenue per center as compared to the same period in the prior year.
Removed
Other income for the year ended December 31, 2024 increased $585,618 primarily related to steady interest rates and the associated interest income received on higher average bank account balances at our sponsor bank.
Added
Other income for the year ended December 31, 2025 decreased $446,274 primarily related to the implied interest expense related to future cash payments for the Gamma acquisition of $395,130 and slightly lower interest rates. At December 31, 2025, our income tax expense totaled $2,481,641, representing an effective tax rate of 24.7%.
Removed
We recorded an income tax benefit of $4,094,911 for the year ended December 31, 2023, which equates to an effective tax rate of (173.2)%, primarily as a result of the release of our valuation allowance of $4,588,781 on our federal and state deferred tax assets.
Added
This rate was primarily driven by higher book earnings and adjustments to our provision estimate related to Section 174 changes under the One Big Beautiful Bill Act, offset by tax benefits associated with stock-based compensation and tax credits.
Removed
The net income for the year ended December 31, 2024 was $3,815,907, a decline of $2,642,820 compared to the net income of $6,458,727 for the year ended December 31, 2023.
Added
For the year ended December 31, 2025, $8,094,210 of cash was used for investing activities primarily attributable to an increase in software licenses, fixed assets, and capitalization of internally developed software as we continue to invest in our technology platform. The remaining amount of $2,000,000 was used for the Gamma acquisition.
Removed
We used net cash in investing activities during the years ended December 31, 2024 and 2023 of $9,488,702 and $7,048,678, respectively.
Added
Intangible assets with a finite life are amortized on a straight-line basis over their estimated useful lives, which are generally 3 to 10 years. Goodwill – Our methodology for allocating the purchase price relating to acquisitions is determined through established valuation techniques.
Removed
The decrease resulted primarily from payment timing on pass-through claim reimbursement receivables and related payables associated with our patient affordability business, in the amount of $7,018,053 offset by the improvement in our operating results.
Added
Goodwill represents a residual value as of the acquisition date, which in most cases results in measuring goodwill as an excess of the purchase consideration transferred plus the fair value of any noncontrolling interest in the acquired company over the fair value of net assets acquired, including contingent consideration.
Removed
In particular, we are closely following FDIC publicly announced developments, but those developments have not caused us to alter our bank relationships in any material respect at this time.
Added
We perform goodwill impairment tests on an annual basis in the fourth fiscal quarter, and, in certain circumstances between annual tests. The assessment of fair value for goodwill and purchased intangible assets is based on factors that market participants would use in an orderly transaction in accordance with the new accounting guidance for the fair value measurement of non-financial assets.
Removed
For computer software developed or obtained for internal use, costs that are incurred in the preliminary project and post implementation stages of software development are expensed as incurred. Costs incurred during the application and development stage are capitalized, as the Platform asset.
Added
The Company is currently under no obligation to refund any fees, and the Company does not currently have any obligations for disputed claim settlements. Given the nature of the Company’s services and contracts, generally it has no contract assets as it pertains to services rendered but not invoiced.
Removed
This has primarily been associated with the pharma prepaid business which ended in 2022. The Company records all revenue on a gross basis since it is the primary obligor and establishes the price in the contract arrangement with its customers.

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