NATURE OF BUSINESS

12 Months Ended

Dec. 31, 2012

NATURE OF BUSINESS [Abstract]

NATURE OF BUSINESS

Note 1 – Nature of Business

Direct Insite Corp. ("Direct Insite" or the "Company") operates as a Software as a Service provider ("SaaS"), providing financial supply chain automation and workflow efficiencies within the Procure-to-Pay and Order-to-Cash processes. Specifically, Direct Insite's global electronic invoice ("e-invoice") management services automate complex manual business processes such as invoice validation, order matching, consolidation, dispute handling, and e-payment processing in a business-to-business transaction based "fee for services" business model.

The Company's revenue comes from (i) recurring, on-going services that are billed monthly; and (ii) non-recurring, professional services derived from the configuration of the Company's software platform.

Throughout the year, the Company operated redundant data centers in Miami, Florida, and Santa Clara, California.

As described in Note 10, the Company has three major customers (one of which has separate contracts with multiple companies) that accounted for 88% and 92% of the Company's revenue for the years ended December 31, 2012 and 2011, respectively.  Loss of any of these customers, or any of the separate contracts under a main customer, could have a material effect on the Company.

As described in Note 11, in February 2013, the Company was notified by one of the three major customers that one of its customers comprising 13.9% and 17.8% of the Company's revenues in the years ended December 31, 2012 and 2011, respectively, was terminating its contract effective March 31, 2013.  The Company is in active negotiations to continue providing a portion, if not all, of the level of services historically provided.