NATURE OF BUSINESS

6 Months Ended

Jun. 30, 2013

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 Note9, the Company has two major customers that accounted for 80.1% and 80.4% of the Company's revenue for the three months ended June 30, 2013 and 2012, respectively, and 79.6% and 80.7% of the Company's revenue for the six months ended June 30, 2013 and 2012, respectively.  Loss of any of these customers would have a material effect on the Company.

In February 2013, the Company was notified by HP Enterprise Services ("HP") (see Note 9), that one of its customers that comprised 18.5% and 13.3% of the Company's revenues for the three months ended June 30, 2013 and 2012, respectively, and 15.7% and 13.9% of the Company's revenues for the six months ended June 30, 2013 and 2012, respectively, was terminating its contract effective March 31, 2013.  As disclosed in the Company's Current Report on Form 8-K filed with the Securities and Exchange Commission ("SEC") on July 24, 2013, the Company determined that despite its efforts to negotiate direct contractual agreement with this client, the client ultimately decided to sunset its use of the application. As such, the Company does not expect to record any revenue from this client after June 30, 2013.