Paymate Combined Financial Services Guide and Product Disclosure Statement

   ·   Bank Account Payment Service

   ·   Foreign Exchange Transaction Service

Release 1.0, Version 1.0. Publication date: 28 October 2005.

1. Paymate Financial Services Guide

1.1 What is the Paymate Financial Services Guide ('FSG')?

Australian law requires Paymate Pty Ltd ABN 91 093 528 002 ("Paymate", "we", "us" or "our") to give you an FSG to help you make an informed decision about whether you want to use the financial services we provide.

In particular, this FSG explains:

   ·   who we are;

   ·   the financial services and products we are authorised to provide;

   ·   how we and others may be remunerated in relation to the financial services we provide;

   ·   any relationships or associations we may have with other financial services providers; and

   ·   how we deal with any complaints you make against us.

1.2 What other documents may Paymate give me?

You have also received a Product Disclosure Statement ("PDS") in part 2 of this document. The PDS is a legal disclosure document that is intended to help you to decide whether to acquire any financial product we issue. We will generally give you a PDS if we offer or arrange to issue a financial product to you. The PDS sets out various information, including a description of the significant benefits, risks and conditions attaching to any financial product issued by us.

1.3 Who provides the financial services described in this FSG and how can I contact them?

All financial services described in this FSG are provided by Paymate Pty Ltd (ABN 91 093 528 002) (AFSL no. 290582).

If you have any questions or need more information, you can:

   ·   refer to our website at: www.paymate.com.au

   ·   e-mail us at: clientservices@paymate.com.au.

   ·   call us on: +612 9283 6977;

   ·   fax us on: +612 9283 6944; or

   ·   write to us at: Paymate Pty Ltd, Suite 2501, 31 Market Street, Sydney, New South Wales, 2000, Australia.

1.4 What financial products and services are Paymate authorised to provide?

Paymate is authorised under its AFSL to provide the following financial services:

   ·   give general financial product advice (this is financial product advice that does not take into account your personal circumstances, situation or needs) in relation to non-cash payment, foreign exchange and general insurance products; and

   ·   deal in non-cash payment, foreign exchange and general insurance products.

Our current services and products include services regulated by the Australian Corporations Act 2001 (Cth) ("Regulated Paymate Services") and services that are not regulated in this way. At the date of this FSG, the services we offer that are not regulated by the Australian Corporations Act 2001 (Cth) are:

   ·  AUD Credit Card Payment Service;

   ·  Foreign Currency Credit Card Payment Service (in selected foreign currencies); and

   ·  arranging for DHL to provide its Express Courier Service.

At the date of this FSG, the Regulated Paymate Services are:

   ·  our Bank Account Payment Service (in AUD and selected foreign currencies); and

   ·  our Foreign Exchange Transaction Service (in selected foreign currencies).

1.5 Who do we act for when we provide you with financial services?

We are the issuer for the financial products we offer that are described in this FSG.

1.6 What relationships does Paymate have with other product issuers?

All of the Paymate Regulated Services relate to financial products issued by us.

We use several facilities provided to us by major banks and licensed foreign exchange dealers to enable us to provide our services to you. These include:

   ·  AUD Credit Card and Foreign Currency Credit Card Merchant Facilities;

   ·  Direct Debit/Credit Facilities in several countries; and

   ·  currency conversion services.

1.7 How is Paymate paid and does Paymate receive any commission in respect of the Paymate Regulated Services?

Paymate receives a commission in the form of transaction and subscription fees that may be paid by clients for the provision of the Paymate Regulated Services. These fees are detailed in the PDS in part 2 of this document.

In the provision of the Foreign Exchange Transaction Service, Paymate may achieve a 'spread' or margin between the daily rate at which we settle a payment to a Seller/Recipient and the daily rate at which we actually convert the payment from the foreign currency to AUD at a later date or time. This spread may be positive or negative based on the timing of the conversion and the movement of the foreign currency markets during that period. This means that we may make a profit if foreign currency rates move in our favour when we actually convert the payment. However, any difference between the rate at which we settle a payment to you and the rate at which we actually convert this payment at a later date or time is not passed on to the Seller/Recipient.

No related body corporate of Paymate, directors or employees of Paymate or a related body corporate or any associate of any of these persons receive any remuneration (including commission) or other benefits in respect of, or that is attributable to, the provision of any of the Paymate Regulated Services. Paymate staff members are salaried employees of Paymate and do not receive any proportion of any fees or other sums paid to Paymate in connection with the financial services or products detailed in this FSG.

If you are referred to Paymate by a registered Paymate client, that client may receive Paymate Reward Points that are redeemable to pay for Paymate fees. Currently, each such referral is awarded 200 Paymate Reward Points, which can be redeemed for $2.00 worth of Paymate fees.

1.8 How can I instruct Paymate?

You can give us instructions by using the contact details set out in part 1.3 of this FSG. Some products and services may have their own rules around how to provide instructions or execute certain transactions, including that these instructions be made by e-mailing us on clientservices@paymate.com.au or online through our website www.paymate.com.au Please refer to the PDS set out in part 2 of this document and the Paymate Terms of use for these details.

1.9 What do I do if I have a complaint?

Any complaints about any goods or services paid for using any service provided by us should be resolved directly with the supplier of those goods and services. However, to complain to Paymate, you should follow the steps detailed below.

To clarify your rights in using Paymate's services, we recommend you carefully read our Terms of use. You can then decide if you wish to raise a complaint.

Step 1: Contact Client Services

To complain about a Paymate product or service your first step is to contact our Client Services team. You can do this by:

   1.   sending an email with the subject "Complaint" to: complaints@paymate.com.au; or

   2.   writing to or calling: Client Services Manager, Paymate Pty Ltd, Suite 2501, 31 Market Street, Sydney, NSW, 2000. Australia Phone: (+612) 9283 6977.

We will respond to most, but not all emails, within one business day and to all emails within three business days (please allow for Australian public holidays since we are based in Sydney Australia). If we cannot immediately resolve the problem, we will give you details of our procedures for investigating and resolving complaints. Within 21 days of receiving your complaint, we will either advise you of the outcome of our investigation or will tell you that we need more time to resolve your complaint. Note that we may have to request information from third parties such as banks overseas.

We aim to fully resolve all complaints within 45 days unless there are exceptional circumstances.

Step 2: Escalate to Senior Management

If you are still unsatisfied with our response or your complaint is about one of our Client Service staff, you can escalate your complaint directly with Paymate's senior management. To do so, please forward your earlier email with any earlier responses to feedback@paymate.com.au

You can also write to us or call us at: Managing Director, Paymate Pty Ltd, Suite 2501, 31 Market Street, Sydney, NSW, 2000 Australia Phone: (+612) 9283 6977.

Paymate's senior management will respond to most, but not all complaints, within 10 business days of escalation and all complaints within 30 business days. We will let you know if we need more time to resolve your complaint.

Step 3: Escalate to Banking & Financial Services Ombudsman

Alternatively, you may choose to contact the Banking & Financial Services Ombudsman (BFSO) to lodge a dispute. The BFSO is a dispute resolution service dealing with disputes that individuals and small business have with their financial service providers. You can learn more about the BFSO here: www.bfso.org.au.

The Ombudsman's powers to consider disputes are set out in their Terms of Reference.

This Jurisdiction Checker may help you to work out whether your dispute falls within the BFSO's jurisdiction.

We recommend you write to the BFSO, preferably with a copy to Paymate, at the following address:

Banking & Financial Services Ombudsman, GPO Box 3, MELBOURNE VIC 3001

Fax: (03) 9613 7345; Phone: 1300 78 08 08

Monday to Friday between 9.00 am and 5.00 pm AEST

You can also your lodge your dispute using an Online dispute form. For information, visit Lodging your Dispute page or www.bfso.org.au

2. Paymate Product Disclosure Statement

2.1 Who is Paymate?

At Paymate, we provide a secure, accurate and reliable Internet payment service, allowing any individual, business or other organisation with an e-mail address and an eligible credit card or bank account to send and receive payments online.

The table below provides a brief summary of the main services we currently offer. The services highlighted in yellow are financial services regulated by the Australian Corporations Act 2001 (Cth) ("Regulated Paymate Services"). This Product Disclosure Statement ("PDS") aims to help you make an informed decision whether to register for, or use, any of the Regulated Paymate Services. At the date of this PDS, the Regulated Paymate Services are:

   ·  the Bank Account Payment Service; and

   ·  the Foreign Exchange Transaction Service.

2.2 What is the purpose of this PDS?

Australian law requires us to give you this PDS to help you:

   ·  understand the significant benefits and risks associated with the Regulated Paymate Services;

   ·  understand other significant characteristics, features and terms of the Regulated Paymate Services; and

   ·  compare understand Regulated Paymate Services with other similar services you may be considering.

Please read this PDS together with the Paymate Terms of use carefully before deciding whether to register for, or use, any of the Regulated Paymate Services set out in this PDS.

Any advice in this PDS has been prepared without taking into account your personal objectives, financial situation or needs and you should consider whether it is appropriate for your circumstances.

2.3 Who is the issuer of the products set out in this PDS and how can I contact them?

The issuer of the Regulated Paymate Services is Paymate Pty Ltd (ABN 91 093 528 002) (AFSL no. 290582) ("Paymate").

Please see part 1.3 of the Financial Services Guide for information on how you can contact us.

2.4 Features at a glance

Product/Service: Bank Account Payment Service

Significant Benefits

   ·  Allows you as a Buyer/Sender to use your bank account held with a financial institution in selected countries to make a payment in your local currency to a Seller/Recipient in Australia and registered with Paymate to receive payments online, rather than having to make a credit card or telegraphic transfer payment.

   ·  Allows you to make secure payments online without revealing your financial information to the Seller/Recipient.

   ·  Reduces costs compared to a telegraphic or wire transfer since no sign-up or ongoing fees are payable when registering with us solely to use the Bank Account Payment Service.

   ·  Reduces foreign currency risk for you as you make payments in your local currency.

   ·  Provides an ability to track payments on-line.

We use some of the best commercially available technology and procedures to protect the security of your online transactions. See the Paymate Security and Privacy Policy for further information.

Significant risks

   ·  Although we have online security and fraud detection systems in place, there is a risk that a third party may fraudulently gain access to your Bank Account Payment Service. You will be liable for any fraudulent transactions involving your Bank Account Payment services if:

   ·   you have revealed your login username, password or account verification amount to another person, whether deliberately or inadvertently, and you failed to take reasonable steps to keep this information confidential; or

   ·   you fail to notify us immediately that your username and/or password has been lost, stolen or its security compromised in any way.

   ·   Since we are dependent on financial institutions, interbank payment systems and payment clearing protocols in Australia and other countries, we cannot guarantee that payments made via this service will always be honoured or cleared by the institutions involved or settled within the time frames indicated in this PDS and the Paymate Terms of use While we will try our best to reduce exceptions and delays, you may experience payment failures and delays in using the Bank Account Payment Service. We are not liable for any loss that you may suffer as a result.

   ·   Although we make every effort to ensure the Bank Account Payment Service is available at all times, our services may be interrupted by systems failure [or by downtime for systems upgrades] and you may be temporarily unable to make payments using the Bank Account Payment Service.

   ·   A payment from your bank account may be subject to regulations, both in Australia and overseas. These include regulations of the place to which or from which the payment is made or received and regulations applicable to the currency of the payment. There is a risk that we may be unable to make a payment from your bank account or to the bank account of your Seller/Recipient because of the regulations that apply to that payment. There is also a risk that a payment may be frozen by an Australian or overseas regulatory authority. We are not liable for any loss you may suffer if a payment is frozen or if we cannot otherwise complete the transaction in accordance with your instructions.

   ·   Payments made using the Bank Account Payment Service are governed by our Terms of use and your use of your Bank Account Payment Service may be suspended and your payments may be cancelled if:

      ·   you provide us with incorrect or inaccurate information;

      ·   you do not use any Paymate Service for bona fide and lawful purposes;

      ·   you use any Paymate Service in connection with gambling, adult content, nudity or pornography.

Fees & Charges

   ·   Paymate clients (individuals and businesses) will be charged for services as set out in the Fees page or as otherwise agreed for a specific product or service. Charges may include a combination of subscription and transaction fees, and may vary from time to time. All prices quoted by Paymate include GST for clients domiciled in Australia . Overseas clients may not be liable for GST.

   ·   Paymate currently does not charge the Buyer/Sender any fees in relation to the Bank Account Payment Service. We will advise you if we introduce any fees or charges in the future. Paymate may charge the Buyer/Sender an exception processing fee equivalent to AUD 15.00 for any Payments from your Nominated Debit Account which are dishonoured. This fee is payable when we receive notice of a dishonour from your bank or credit card or other financial services provider.

   ·   You may incur bank transaction fees on the bank account from which we debit any payments made by you using the Bank Account Payment Service. If you authorise Paymate to debit your nominated bank account when there are insufficient funds to honour the debit, you may incur fees on the exception transaction. To find out whether any such fees apply, you should contact the financial institution where your Nominated Debit Account is held.

   ·   If you have also registered with Paymate to receive payments online as a Seller/Recipient, you may be liable for account and transactional fees for this service. Please see our Fees page for more information.

Significant conditions

   ·   You can only use the Bank Account Payment Service if you have a current e-mail address, are at least 18 years old, have a bank account held by a financial institution in selected countries and register with Paymate (including by providing us with certain personal details such as your bank account number and a signed authorisation to withdraw funds from this account) at www.paymate.com.au/register/ to use the Bank Account Payment Service.

   ·   You will not be able to make payments using the Bank Account Payment Service until we have verified your bank account. We do this by crediting and debiting a small random amount to your nominated bank account and asking you to confirm this amount.

   ·   You can only use the Bank Account Payment Service to pay Sellers/Recipients who have:

      ·   registered with Paymate to receive payments online into a deposit account held with an Australian financial or deposit-taking institution; and

      ·   a current e-mail address.

   ·   The clearance period is typically (but not always) 4 business days (being a day on which banks are open for business, except for a weekend or public holiday) for payment from an Australian bank account and 5 business days for payment from an overseas bank account.

   ·   Minimum and maximum payment amounts apply per transaction:

      ·   Payments from Australia – $1.00 minimum payment and maximum payment of AUD$10,000

      ·   Payments from the US – minimum payment of US$75 and maximum payment of US$10,000

      ·   Payments from New Zealand – minimum payment of NZ$100 and maximum payment of $10,000

      ·   Payments from Singapore – minimum payment of SG$100 and maximum payment of SG$12,000

      ·   Payments from Hong Kong – minimum payment of HK$600 and maximum payment of HK$60,000

   ·   If your payment goes through, you will receive a receipt page displayed with a transaction ID. You can either note the transaction ID number or print a receipt; we will also e-mail confirmation of payment to you.

   ·   You will only be able to cancel a payment by emailing us at clientservices@paymate.com.au before we process this payment. It typically takes us 4 – 5 business days (being a day on which banks are open for business, except for a weekend or public holiday) to clear a payment and process the payment to the bank account of your Seller/Recipient.

   ·   when all pending payments have been processed or cancelled, you can cancel your registration with Paymate by emailing us at clientservices@paymate.com.au. This cancellation will take place no later than 2 business days after you notify us in this way.

Product/Service: Foreign Exchange Transaction Service

Significant Benefits

   ·   Allows you as an Australian Seller/Recipient to agree a price with a Buyer/Sender in foreign currencies supported by Paymate and receive payment in AUD into your nominated Australian bank account.This enables each party to trade in a familiar local currency.

   ·   Reduces costs for your Buyer/Recipient that may be incurred with other payment methods, e.g. Telegraphic/Wire Transfers, bank cheques or demand drafts.

   ·   Eliminates foreign currency risk for your Buyer/Recipient since they do not need to purchase your currency (AUD), as may be the case with Telegraphic/Wire Transfers.

   ·   Eliminates the need for you to maintain foreign currency accounts, convert from foreign currencies to your local currency (e.g. USD to AUD) or move funds from foreign currency to local currency bank accounts and may reduce your costs.

Significant risks

   ·   When the payment to you is cleared by us (typically 3 – 5 days after the Buyer/Sender makes the payment), we use the indicative foreign currency 'sell rates' published by HSBC Bank Australia (at http://www.hsbc.com.au/ ) on that day to convert your foreign currency payment into AUD for settlement to your bank account overnight. You cannot select the timing or exchange rate at which your funds are converted from the foreign currency into AUD.

   ·   The foreign currency exchange rates may change from the time you agree a price in foreign currency with your Buyer/Sender and when we convert your funds into AUD. Depending on the way exchange rates change, you may receive less (or more) money (in AUD) than you anticipated when you set the payment price with your Buyer/Sender.

Fees & Charges

   ·   While Paymate does not charge explicit fees for the Foreign Exchange Transaction Service, you may incur additional fees as a Seller if you choose to receive payments via the Foreign Currency Credit Card Payment Service. Please see our Fees page for more information.

Significant conditions

   ·   You can only use the Foreign Exchange Transactions Service if you have a current e-mail address, are at least 18 years old and register with Paymate to receive payments online into a deposit account held by you with an Australian financial or deposit-taking institution. If you decide to register with us to receive payments online in this way, you will need to agree to the Paymate Terms of use and any Fees that we may charge when you receive payments online. You should read these documents carefully before deciding to register to use the Foreign Exchange Transactions Service

   ·   You can register to use the Foreign Exchange Transactions Service by checking the "Accept foreign currency" box in the "account type selection" section of our online registration process available at https://www.paymate.com/register/

2.5 Are there any other terms and conditions?

All of the detailed terms and conditions relating to the Regulated Paymate Services are set out in the Paymate Terms of use and the Paymate Paymate Security and Privacy Policy . You should read these documents carefully before deciding to register for, or use, a Regulated Paymate Service

2.6 What do I do if I have a complaint?

Please see part 1.9 of the Financial Services Guide for information on what to do if you have a complaint.

2.7 What if Paymate updates the information in this PDS?

The information in this PDS is up to date as at 28 October 2005.

After you have registered to use any of the Regulated Paymate Services, we will notify you of any material change to, or significant event affecting, the information in this PDS. You agree that we will notify you of this updated information on the 'Changes to FSG/PDS' page in the Help/FAQ section of our website www.paymate.com.au. You can also email us at clientservices@paymate.com.au or call us on +612 9283 6977 to request a paper copy be mailed to you free of charge.

2.8 Other information available

Additional information in respect of the Paymate Regulated Services (including the Paymate Terms of Use) is available on our website at www.paymate.com.au