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Total System Services Inc. (TSS - Analyst Report), a leading payment processor, in association with banking and payment service provider, Discover Financial Services Inc. (DFS - Analyst Report) entered into a deal to process payment transactions for PayPal in U.S. PayPal is a global e-commerce entity that allows payments and money transfers through the internet.

PayPal operates in more than 190 markets, manages more than 232 million accounts and intends to expand further. Total System on the other hand provides its services to financial institutions, businesses and governments in more than 80 nations worldwide.

Previously, in Aug 2012, Discover partnered with PayPal to extend PayPal to more than 7 million merchant locations. With this deal, Total System intends to help PayPal expand to more merchant locations by providing an expanded platform.

Through Total System, prospective PayPal clients will be exposed to an enhanced payment option. They will be able to make payments and transfer money on a large scale and to more number of merchant locations, thereby making PayPal more accessible. This is expected to attract more customers for PayPal and hence support its expansion objectives. We expect the above deal to complement Total System operations and help the company expand in turn by accessing the extensive clientele base of PayPal.

Total System has been working towards enhancing its operations, be it through assisting other companies in their business or entering into deals with other companies to leverage its own operations. Towards this end last week, Total System extended its alliance with leading analytics software company, Fair Issac Corporation (FICO - Snapshot Report) to receive fraud management services from the latter. With the integration of the Falcon Fraud Manager 6, Total System aims to provide its PRIME clients with high-end anti-fraud solutions that would in turn enable them to develop PRIME and maintain its international footprint. PRIME is the card and merchant management solution offered by Total System.

Total System currently carries a Zacks Rank #1 (Strong Buy). Among other payment processors that are worth considering MasterCard Inc. (MA - Analyst Report) carries a Zacks Rank #2 (Buy).

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