| BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT POLICIES | 1. BASIS OF PRESENTATION AND
SUMMARY OF SIGNIFICANT POLICIES The foregoing unaudited interim condensed
financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America
(“GAAP”) for interim financial information and with the instructions for Form 10-Q and Regulation S-X as promulgated
by the Securities and Exchange Commission (“SEC”). Accordingly, these financial statements do not include all of the
disclosures required by GAAP for complete financial statements. These unaudited interim condensed financial statements should be
read in conjunction with the audited financial statements and the notes thereto included on Form 10-K for the year ended December
31, 2018. In the opinion of management, the unaudited interim condensed financial statements furnished herein include all adjustments,
all of which are of a normal recurring nature, necessary for a fair statement of the results for the interim period presented. The preparation of financial statements
in accordance with GAAP requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities,
disclosure of contingent assets and liabilities known to exist as of the date the financial statements are published, and the reported
amounts of revenues and expenses during the reporting period. Uncertainties with respect to such estimates and assumptions are
inherent in the preparation of the Company’s financial statements; accordingly, it is possible that the actual results could
differ from these estimates and assumptions that could have a material effect on the reported amounts of the Company’s financial
position and results of operations. Operating results for the three and six
months ended June 30, 2019 are not necessarily indicative of the results that may be expected for the year ending December 31,
2019. About Paysign, Inc. Paysign, Inc. (the “Company,”
“Paysign,” or “we”, formerly known as 3PEA International, Inc.) is a vertically integrated provider of
innovative 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 rate, reduce administration
costs and streamline operations. Public sector organizations can utilize our payment solutions to disburse public benefits or for
internal payments. The Company markets prepaid card solutions under our Paysign ® The Paysign brand offers prepaid card based
solutions or “card products” for corporate incentive rewards and corporate expense, per diem and travel payments, healthcare
reimbursement payments, pharmaceutical co-pay assistance, donor compensation and clinical trials. We plan to expand our product
offering to include payroll cards, general purpose re-loadable cards, and others. Our cards are offered to end users through our
relationships with bank issuers. The Paysign platform was built on modern
cross-platform architecture and designed to be highly flexible, scalable and customizable. The platform allows us to significantly
expand our operational capabilities by facilitating entry into new markets within the payments space through its flexibility and
ease of customization. The Paysign platform delivers cost benefits and revenue building opportunities to our partners. We manage all aspects of the debit card
lifecycle, from managing the card design and approval processes with partners and networks, to production, packaging, distribution,
and personalization. We oversee inventory and security controls, renewals, lost and stolen card management and replacement. We
deploy a fully staffed, in-house customer service department which utilizes bilingual customer service agents, Interactive Voice
Response (IVR), and two-way short message service (SMS) messaging and text alerts. On March 4, 2019, our board of directors
and stockholders holding a majority of our outstanding common stock agreed to amend our articles of incorporation to change our
name from 3PEA International, Inc. to Paysign, Inc. As a result, we amended our articles of incorporation on April 23, 2019 for
such name change. Additionally, we changed our trading symbol on the NASDAQ Capital Market to “PAYS”. Principles of consolidation Use of estimates Cash restricted Intangible assets Internally
Developed Software Costs - 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. 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. For intangible assets, we recognize an
impairment loss if the carrying amount of the intangible asset is not recoverable and exceeds fair value. 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 finite lives are
amortized on a straight-line basis over their estimated useful lives. Earnings per share Revenue and expense recognition (Adoption
of ASC 606, Revenue from Contracts with Customers ) Revenue
from Contracts with Customers (ASC Topic 606), The Company recognizes revenue when goods
or services are transferred to customers in an amount that reflects the consideration which it expects to receive in exchange for
those goods or services. In determining when and how revenue is recognized from contracts with customers, the Company performs
the following five-step analysis: (i) identification of contract with customers; (ii) determination of performance obligations;
(iii) measurement of the transaction price; (iv) allocation of the transaction price to the performance obligations; and (v) recognition
of revenue when (or as) the Company satisfies each performance obligations. The Company generates revenue through fees
generated from cardholder transactions, interchange and card program management fees. Revenue from cardholder transactions, interchange
and card program management fees is recorded when the performance obligation is fulfilled. 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. The Company
is currently under no obligation for refunding any fees or has any obligations for disputed claim settlements. Given the nature
of the Company’s services and contracts, it has no contract assets. Stock-Based Compensation Compensation - Stock Compensation (Topic 718) - Improvements to Nonemployee Share-Based
Payment Accounting, Prior to the adoption of ASU 2018-07, stock
based compensation for non-employees is accounted for using the Equity-Based Payments to Non-Employee Topic of the FASB ASC ,
Stock based compensation for employees
is accounted for using the Stock Based Compensation Topic of the FASB ASC. We use the fair value method for equity instruments
granted to employees and will use the Black Scholes model for measuring the fair value of options, if issued. The stock based fair
value compensation is determined as of the date of the grant or the date at which the performance of the services is completed
(measurement date) and is recognized over the requisite service periods, which are generally the vesting periods. New accounting pronouncements Leases. |
