UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                              ---------------------

                                   FORM 10-QSB

(Mark one)
|X|   QUARTERLY Report purSUANT TO Section 13 or 15(d) of the Securities
      Exchange Act of 1934

      For the quarterly period ended October 31, 1999

|_|   Transition Report Pursuant to Section 13 or 15(d) of the Securities
      Exchange Act of 1934

      For the transition period from _________________ to _________________

      Commission file number 1-8460


                          UNIVERSAL MONEY CENTERS, INC.
        (Exact name of small business issuer as specified in its charter)


              Missouri                              43-1242819
   (State or other jurisdiction of      (I.R.S. Employer Identification No.)
   incorporation or organization)


                     6800 Squibb Road, Mission, Kansas 66202
                    (Address of principal executive offices)


                                 (913) 831-2055
                           (Issuer's telephone number)


     Check  whether  the issuer (1) filed all  reports  required  to be filed by
Section 13 or 15(d) of the Securities and Exchange Act during the past 12 months
(or for such  shorter  period  that the  registrant  was  required  to file such
reports),  and (2) has been subject to such filing  requirements for the past 90
days. Yes X  No __

     Number of shares  outstanding  of each of the  issuer's  classes  of common
equity as of December  15, 1999:  39,293,069  shares of Common  Stock,  $.01 par
value per share.

     Transitional Small Business Disclosure Format:   Yes     No  X


                                    Page - 1
<PAGE>


NOTE CONCERNING FORWARD-LOOKING STATEMENTS

      The Company believes that certain statements contained in this Quarterly
Report on Form 10-QSB that are not statements of historical fact may constitute
forward-looking statements within the meaning of Section 21E of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"). These statements involve
risks and uncertainties that may cause actual results to differ materially from
those in such statements. See Part I, Item 2 "Management's Discussion and
Analysis or Plan of Operation - Cautionary Statement Concerning Forward-Looking
Statements" for additional information and factors to be considered with respect
to forward-looking statements.






                                    Page - 2

<PAGE>


PART I - FINANCIAL INFORMATION
Item 1.     Financial Statements

<TABLE>
<CAPTION>
                          UNIVERSAL MONEY CENTERS, INC.
                           CONSOLIDATED BALANCE SHEETS

                                     ASSETS

                                                                October 31, 1999    January 31,
                                                                 (unaudited)          1999
                                                               ----------------- ----------------

                        CURRENT ASSETS
<S>                                                            <C>               <C>
    Cash                                                       $           --    $    601,922
    Notes receivable - affiliate                                      650,300              --
    Accounts receivable - trade, less allowance for doubtful
           accounts:                                                   73,469          39,012
        October 31, 1999 - $21,370; January 31, 1999 - $21,370
    Accounts receivable - affiliate                                    32,990          35,064
    Inventories                                                           300             300
    Prepaid expenses and other                                         16,716          12,894
    Interest receivable - affiliate                                     6,628           3,636
                                                               ----------------- ----------------
                             Total Current Assets                     780,403         692,828
                                                               ----------------- ----------------

PROPERTY AND EQUIPMENT, At cost
    Equipment                                                       3,819,939       3,453,071
    Leasehold improvements                                            117,803         117,803
    Vehicles                                                           21,156           9,722
                                                               ----------------- ----------------
                                                                    3,958,898       3,580,596
    Less accumulated depreciation                                  (2,052,140)     (1,873,919)
                                                               ----------------- ----------------
                             Total Property and Equipment           1,906,758       1,706,677
                                                               ----------------- ----------------

OTHER ASSETS
    Deferred income taxes                                             375,000         375,000
    Other                                                              72,862          30,531
                                                               ----------------- ----------------
                             Total Other Assets                       447,862         405,531
                                                               ----------------- ----------------

                             Total Assets                      $    3,135,023    $  2,805,036
                                                               ================= ================
</TABLE>





See Notes to Consolidated Financial Statements (Unaudited)


                                    Page - 3
<PAGE>

<TABLE>
<CAPTION>

                          UNIVERSAL MONEY CENTERS, INC.

                           CONSOLIDATED BALANCE SHEETS


                      LIABILITIES AND STOCKHOLDERS' EQUITY




                                                             October 31, 1999     January 31, 1999
                                                               (unaudited)
                                                           -------------------  -------------------

CURRENT LIABILITIES
<S>                                                        <C>                  <C>
    Current maturities of long-term debt and capital lease $       167,610      $       314,606
    obligations
    Accounts payable                                               377,830              313,319
    Accounts payable - affiliate                                    19,890                   --
    Accrued expenses                                               239,673              210,817
                                                           -------------------  -------------------
                      Total Current Liabilities                    805,003              838,742
                                                           -------------------  -------------------


LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS                       978,655              714,087
                                                           ------------------   ------------------

STOCKHOLDERS' EQUITY
    Common stock; no par value; $.01 stated value;
        40,000,000 shares authorized; 39,851,380 issued
        as of 10/31/99 and 1/31/99                                 398,514              398,514
    Additional paid-in capital                                  18,593,430           18,593,430
    Retained earnings (deficit)                                (15,978,271)         (16,077,429)
                                                           -------------------  -------------------
                                                                 3,013,673            2,914,515

    Less treasury stock, at cost; common stock
         558,311 shares as of 10/31/99 and 1/31/99              (1,662,308)          (1,662,308)
                                                           -------------------  -------------------
                      Total Stockholders' Equity                 1,351,365            1,252,207
                                                           -------------------  -------------------

                      Total Liabilities and Stockholders'  $     3,135,023      $     2,805,036
                      Equity                               ===================  ===================

</TABLE>




See Notes to Consolidated Financial Statements (Unaudited)


                                    Page - 4
<PAGE>

<TABLE>
<CAPTION>

                          UNIVERSAL MONEY CENTERS, INC.

                  CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)



                                      Three Months Ended October 31,      Nine Months Ended October 31,
                                           1999             1998               1999               1998
                                           ----             ----               ----               ----

<S>                                   <C>               <C>                <C>               <C>
NET REVENUES                          $   1,571,145     $ 1,335,228        $  4,526,794      $  3,731,184

COSTS OF REVENUES                         1,151,470         878,972           3,230,013         2,501,151
                                         -----------      ------------      ------------      --------------

GROSS PROFIT                                419,675         456,256           1,296,781         1,230,033

OPERATING EXPENSES                          375,381         293,557           1,089,723           890,669
                                         -----------      ------------      ------------      --------------

INCOME FROM OPERATIONS                       44,294         162,699             207,058           339,364
                                         -----------      ------------      ------------      --------------

OTHER INCOME (EXPENSE)
                 Interest income             20,062           9,908              53,108            22,268
                 Interest expense           (79,052)        (48,055)           (161,090)         (127,918)
                 Other                           --              --                  82                --
                                         -----------      ------------      ------------      --------------
                                            (58,990)        (38,147)           (107,900)         (105,650)
                                         -----------      ------------      ------------      --------------

INCOME (LOSS) BEFORE INCOME TAXES           (14,696)        124,552              99,158           233,714

INCOME TAX PROVISION (CREDIT)                    --              --                  --                --

NET INCOME (LOSS)                     $     (14,696)    $   124,552        $     99,158      $    233,714
                                         ===========      ============      ============      ==============

BASIC & DILUTED EARNINGS PER SHARE    $      (.0004)    $    0.0032        $     0.0025      $     0.0060
                                         ===========      ============      ============      ==============
</TABLE>






See Notes to Consolidated Financial Statements (Unaudited)


                                    Page - 5
<PAGE>


<TABLE>
<CAPTION>
                          UNIVERSAL MONEY CENTERS, INC.

                CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

                                                                      Nine Months           Nine Months
                                                                         Ended                 Ended
                                                                   October 31, 1999      October 31, 1998
                                                                   ----------------      ----------------

CASH FLOWS FROM OPERATING ACTIVITIES
<S>                                                               <C>                 <C>
         Net income (loss)                                        $      99,158       $        233,714
         Items not requiring (providing) cash:
                 Depreciation                                           379,278                304,095
         Changes in:
                 Accounts receivable                                    (35,375)                32,498
                 Prepaid expenses and other                             (46,153)               (23,766)
                 Accounts payable and accrued expenses                  113,257                 94,272
                                                                   ----------------      ----------------
                    Net cash provided by (used in)                      510,165                640,813
                    operating activities
                                                                   ----------------      ----------------

CASH FLOWS FROM INVESTING ACTIVITIES
             Purchase of property and equipment                        (293,150)              (296,468)
             Increase from notes receivable - affiliate                 650,300               (415,000)
                                                                   ----------------      ----------------
                    Net cash provided by (used in)                      943,450               (711,468)
                     investing activities
                                                                   ----------------      ----------------

CASH FLOWS FROM FINANCING ACTIVITIES
             Principal payments under long-term debt and capital       (261,271)              (184,779)
             lease obligations
             Proceeds from issuance of long-term debt                    92,634                149,480
                                                                   ----------------      ----------------
                     Net cash provided by (used in)                    (168,637)               (35,299)
                     financing activities
                                                                   ----------------      ----------------

INCREASE (DECREASE) IN CASH                                            (601,922)              (105,954)

CASH, BEGINNING OF PERIOD                                               601,922                374,675
                                                                   ----------------      ----------------

CASH, END OF PERIOD                                               $          --       $        268,721
                                                                   ================      ================
</TABLE>









See Notes to Consolidated Financial Statements (Unaudited)


                                    Page - 6
<PAGE>


                          UNIVERSAL MONEY CENTERS, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1.  General

      The consolidated financial statements include the accounts of Universal
Money Centers, Inc. (the "Company"), and its wholly-owned subsidiaries,
Electronic Funds Transfer, Inc., Corporate Payments Systems, Inc. (inactive)
and A.M. Corporation (inactive).  All significant intercompany accounts and
transactions have been eliminated in consolidation.

      The unaudited consolidated financial statements included herein have been
prepared by the Company pursuant to the rules and regulations of the Securities
and Exchange Commission. Accordingly, they reflect all adjustments that are, in
the opinion of management, necessary for a fair presentation of the financial
results for the interim periods. Certain information and notes normally included
in financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to such rules and
regulations. The Company believes, however, that the disclosures are adequate to
make the information presented not misleading. These consolidated financial
statements should be read in conjunction with the consolidated financial
statements and the notes thereto included in the Company's Annual Report on Form
10-KSB for the fiscal year ended January 31, 1999.

2.  Future Changes in Accounting Principles

       In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities." This Statement establishes the accounting
for derivative instruments, including certain derivative instruments imbedded in
other contracts and hedging activities. This Statement is effective for all
fiscal quarters of fiscal years beginning after June 15, 1999. Management has
not yet determined the impact of adopting this pronouncement on the Company's
results of operations or financial position.

       In March 1998, the AICPA issued SOP 98-1, "Accounting for the Costs of
Computer Software Developed or Obtained for Internal Use." This SOP provides
guidance on accounting for the costs of computer software developed or obtained
for internal use. This SOP is effective for fiscal years beginning after
December 15, 1998. Management has not yet determined the impact of adopting this
pronouncement on the Company's results of operations or financial position.

3.  Earnings Per Share

      The computation of earnings per share is based upon the weighted average
number of common shares outstanding during the respective period. For all
periods reflected in the Consolidated Financial Statements, the weighted average
number of common shares outstanding was 39,293,069 shares.


                                    Page - 7
<PAGE>


Item 2.   Management's Discussion and Analysis or Plan of Operation

Overview

     Universal Money Centers, Inc. (the "Company") operates a network of
automated teller machines ("ATMs"). The ATMs provide holders of debit and credit
cards access to cash, account information and other services at convenient
locations and times. At October 31, 1999, the network consisted of approximately
307 ATMs owned by the Company and its affiliate, Universal Funding Corporation
("Funding"), 74 ATMs owned by banks and 127 ATMs owned by third party merchants.
ATMs in the Company's network are principally installed in convenience stores
and banks with locations concentrated in the Kansas City and St. Louis, Missouri
and El Paso, Texas metropolitan areas, and the state of Kansas. Since early
October 1999, the Company's network also included ATMs owned or leased by third
parties and placed in 89 Kmart Corporation retail stores located in Michigan,
Minnesota and Wisconsin. In addition, on November 1, 1999, the Company added 58
ATMs to be leased by the Company and located in 58 Kmart stores located in
Illinois. As of February 1, 2000, the Company has the right under its agreement
with Kmart to remove ATMs which do not meet certain performance standards.  The
Company is currently evaluating which, if any, of these ATMs to remove. For
more information regarding the Company's recent lease transaction see the
Company's Current Report on Form 8-K dated October 31, 1999. The Company is
currently engaged in discussions with certain parties regarding the placement
and/or management of approximately 18 ATMs in certain locations in Colorado and
Texas. There can be no assurance that the Company will reach an agreement with
these parties on satisfactory terms.

     In addition to operating its network, the Company also provides ATM
network management services to banks and other third parties owning ATMs in the
Company's ATM network.

     The Company's revenues are principally derived from two types of fees,
which the Company charges for processing transactions on its ATM network. The
Company receives an interchange fee from the issuer of the credit or debit card
for processing a transaction when a cardholder uses an ATM in the Company's
network. In addition, in most cases the Company receives a surcharge fee from
the cardholder when the cardholder makes a cash withdrawal from an ATM in the
Company's network.

     Interchange fees are processing fees that are paid by the issuer of the
credit or debit card used in a transaction. Interchange fees vary for cash
withdrawals, balance inquiries, account transfers or uncompleted transactions,
the primary types of transactions that are currently processed on ATMs in the
Company's network. The maximum amount of the interchange fees is established by
the national and regional card organizations and credit card issuers with which
the Company has a relationship. The Company (or its affiliate, Funding) receives
the full interchange fee for transactions on Company owned ATMs, but sometimes
rebates a portion of the fee to the owner of the ATM location under the
applicable lease for the ATM site. The Company also receives the full
interchange fee for transactions on ATMs owned by banks or third party vendors
included within the Company's network, but rebates a portion of each fee to the
bank or third party vendor based upon negotiations between the parties. The
interchange fees received by the Company vary from network to network and to
some extent from issuer to issuer, but generally range from $0.35 to $0.75 per
cash withdrawal. Interchange fees for balance inquiries, account transfers and
denied transactions are generally substantially less than fees for cash
withdrawals. The interchange fees received by the Company from the card issuer
are independent of the service fees charged by the card issuer to the cardholder
in connection with ATM transactions. Service fees charged by card issuers to
cardholders in connection with transactions through the Company's

                                    Page - 8
<PAGE>

network range from zero to as much as $2.50 per transaction. The Company does
not receive any portion of the service fees charged by the card issuer to the
cardholder.

      In most markets the Company imposes a surcharge fee for cash withdrawals.
The Company expanded its practice of imposing surcharge fees in April 1996 when
national debt and credit card organizations changed rules applicable to their
members to permit these fees. Subsequently, surcharge fees have been a
substantial additional source of revenue for the Company and other ATM network
operators. The surcharge fee for ATMs in the Company's network owned by or
located in banks ranges between $0.50 and $1.50 per withdrawal. The surcharge
fee for other ATMs in the Company's network ranges between $0.50 and $2.50 per
withdrawal. The Company receives the full surcharge fee for transactions on
Company owned ATMs, but sometimes rebates a portion of the fees to the owner of
the ATM location under the applicable lease for the ATM site. The Company also
receives the full surcharge fee for transactions on ATMs owned by banks and
third party vendors included within the Company's network, but rebates a portion
of each fee to the bank or third party vendor based upon a variety of factors,
including transaction volume and the party responsible for supplying vault cash
to the ATM.

      The Company's profitability is substantially dependent upon the imposition
of surcharge fees. Any changes in laws or card association rules materially
limiting the Company's ability to impose surcharge fees would have a material
adverse effect on the Company. Voters in San Francisco and Santa Monica,
California recently voted to bar banks from charging fees to non-customers who
use their ATMs ("ATM Fee Bar"). This action has received a lot of media
attention and other cities, such as New York City, have proposed similar pricing
restrictions. However, the banking industry is fighting these restrictions,
claiming that such laws are unconstitutional, and thus invalid, because these
municipal government ordinances attempt to regulate banks, which are already
subject to federal regulation. On November 15, 1999, U.S. District Judge Vaughn
Walker of the United States District Court of the Northern District of
California placed a temporary injunction on the enforcement of the ATM Fee Bar
on the grounds that these ordinances adopted in San Francisco and Santa Monica,
California may be barred by the supremacy clause of the U.S. Constitution.
However, he required affected banks to hold all ATM interchange fees implicated
by the ATM Fee Bar in an escrow account awaiting resolution of the legal issues
involved.

      In addition to revenues derived from interchange and surcharge fees, the
Company also derives revenues from providing network management services to
banks and third parties owning ATMs included in the Company's ATM network. These
services include 24 hour transaction processing, monitoring and notification of
ATM status and cash condition, notification of ATM service interruptions, in
some cases, dispatch of field service personnel for necessary service calls and
cash settlement and reporting services. The fees for these services are paid by
the owners of the ATMs.

      Interchange fees are credited to the Company by networks and credit card
issuers on a periodic basis which is generally either daily or monthly depending
upon the party. Surcharge fees are charged to the cardholder and credited to the
Company by networks and credit card issuers on a daily basis. The Company
periodically rebates the portion of these fees owed to ATM owners and owners of
ATM locations. Fees for network management services are generally paid to the
Company on a monthly basis.


                                    Page - 9
<PAGE>


Comparison of Results of Operations for the Three Months and Nine Months Ended
October 31, 1999 and October 31, 1998.

      Revenues. The Company's total revenues increased to $1,571,145 for the
three months ended October 31, 1999 from $1,335,228 for the three months ended
October 31, 1998 and increased to $4,526,794 for the nine months ended October
31, 1999 from $3,731,184 for the nine months ended October 31, 1998. This
increase is primarily attributable to an increase in the number of ATMs in the
Company's network on which the Company imposed surcharge fees for cash
withdrawals. The number of such ATMs increased to 503 at October 31, 1999 from
327 at October 31, 1998. Surcharge fees increased to $1,071,719 or 68.2% of
total revenues for the three months ended October 31, 1999 from $806,374 or
60.4% of total revenues for the three months ended October 31, 1998. Surcharge
fees also increased to $3,159,359 or 69.8% of total revenues for the nine months
ended October 31, 1999 from $2,204,350 or 59.1% of total revenues for the nine
months ended October 31, 1998. The increase in total revenues is also partially
due to an increase in the number of ATMs in the Company's network, from 350 at
October 31, 1998 to 508 at October 31, 1999. The increase in the number of ATMs
resulted in an increase in the number of transactions processed on ATMs in the
Company's network. Revenues do not initially grow as fast as the number of ATMs
because new ATM sites are not fully utilized for several months after
installation. Therefore, revenues may not increase at the same percentage rate
as increases in the number of ATMs. Revenues derived from interchange fees
increased to $376,343 for the three months ended October 31, 1999 from $260,329
for the three months ended October 31, 1998, and increased to $895,757 for the
nine months ended October 31, 1999 from $726,537 for the nine months ended
October 31, 1998. Revenues derived from interchange fees did not increase at the
same rate as other revenues primarily because the Company imposed surcharge fees
on a greater number of ATMs. The imposition of surcharge fees on cash
withdrawals from an ATM generally causes a decrease in use of the ATM for
transactions for which interchange fees are charged. Revenues received from
Funding under a Management Agreement between the Company and Funding decreased
to $(13,187) and $90,170 the three months and nine months ended October 31,
1999, respectively, from $132,228 and $445,253 for the three months and nine
months ended October 31, 1998, respectively. See "-Revenues from Funding" below.
The Company's revenues from providing network management services to banks and
third parties decreased to $136,270 for the three months ended October 31, 1999
from $136,297 for the three months ended October 31, 1998 and increased to
$381,508 for the nine months ended October 31, 1999 from $355,044 for the nine
months ended October 31, 1998.

      Revenues from Funding. The Company has maintained a business relationship
with Funding since August 1989. The relationship began in 1989 as a result of
the Company's severe financial problems. The operation of the Company's ATM
network generally requires that the Company supply vault cash to ATMs owned by
the Company to fund cash withdrawals. As a result of the Company's financial
problems, lenders were generally unwilling to extend loans partly because of the
concern that the Company's creditors would assert claims against cash physically
located in ATMs owned by the Company. The Company has not had sufficient cash to
supply the vault cash for these ATMs. In order to resolve this problem and to
permit the Company to continue to operate certain ATMs, Funding was formed in
1989 by David S. Bonsal, the Chairman of the Company's Board of Directors, John
L. Settles, the President of the Company since June 3, 1999 and from April 1989
through late 1990, and William Smithson, a shareholder of the Company. Each of
these individuals has a one-third ownership interest in Funding.

                                    Page - 10
<PAGE>


      Under a Management Agreement between the Company and Funding, Funding
provides vault cash for certain ATMs in the Company's network that are owned by
the Company or Funding, and receives all interchange fees for transactions
processed on these ATMs. At October 31, 1999 and 1998, Funding had vault cash
located in approximately 246 and 208 ATMs, respectively, owned by Funding or the
Company. The Company receives a management fee from Funding under the Management
Agreement for providing services to Funding. The management fee paid to the
Company under the Management Agreement equals Funding's "net income." Funding's
"net income" is defined in the Management Agreement as revenues from interchange
fees, less armored security charges, interest expense on funds borrowed to
provide vault cash, ATM location expenses, debt service related to the purchase
of the ATMs, taxes or insurance on ATMs, and a monthly payment to each of
Funding's shareholders representing a return on their equity investment in
Funding.

      The revenues received by the Company from Funding under the Management
Agreement were $(13,187) and $90,170 for the three months and nine months ended
October 31, 1999, equal to Funding's "net income" under the Management Agreement
for the same period. Funding's "net loss" of $13,187 for the three months ended
October 31, 1999 consisted of $246,635 in revenues from interchange fees earned
by Funding, less Funding's expenses in the amount of $253,548 and Funding's
return on equity payment to shareholders of Funding in the amount of $6,275.
Funding's "net income" of $90,170 for the nine months ended October 31, 1999
consisted of $913,658 in revenues from interchange fees earned by Funding, less
Funding's expenses in the amount of $804,868 and Funding's return on equity
payment to shareholders of Funding in the amount of $18,620. Pursuant to the
Management Agreement, Funding's expenses for purposes of computing its "net
income" did not include Funding's depreciation, amortization and bad debt
expenses, which were $977 for the respective periods. The revenues received by
the Company from Funding under the Management Agreement were $132,228 and
$445,253 for the three months and nine months ended October 31, 1998, equal to
Funding's "net income" under the Management Agreement for the same period.
Funding's "net income" of $132,228 for the three months ended October 31, 1998
consisted of $307,265 in revenues from interchange fees earned by Funding, less
Funding's expenses in the amount of $168,762 and Funding's return on equity
payment to shareholders of Funding in the amount of $6,275. Funding's "net
income" of $445,253 for the nine months ended October 31, 1998 consisted of
$958,829 in revenues from interchange fees earned by Funding, less Funding's
expenses in the amount of $494,956 and Funding's return on equity payment to
shareholders of Funding in the amount of $18,620. Pursuant to the Management
Agreement, Funding's expenses for purposes of computing its "net income" did not
include Funding's depreciation, amortization and bad debt expenses, which were
$977 for the respective periods.

      Revenues earned by Funding from interchange fees decreased for the three
months and nine months ended October 31, 1999 from the same periods in 1998, as
a result of fewer interchange transactions per ATMs on ATMs for which Funding
provided vault cash. The number of transactions per ATM decreased principally
because a greater number of the Company's ATMs charged surcharge fees for the
three months and nine months ended October 31, 1999. The imposition of surcharge
fees on cash withdrawals from an ATM generally causes a decrease in use of the
ATM for transactions for which interchange fees are charged. The increase in
Funding's expenses for the three months and nine months ended October 31, 1999
from the same period in 1998 was caused principally by higher outstanding
balances on borrowings by Funding and higher armored security charges. For
additional information concerning Funding, see the Company's Annual Report on
Form 10-KSB for the fiscal year

                                    Page - 11
<PAGE>


ended January 31, 1999, Item 1, "DESCRIPTION OF BUSINESS - Relationship with
Universal Funding Corporation."

      Cost of Revenues. The Company's cost of revenues increased to $1,151,470
and $3,230,013 for the three months and nine months ended October 31, 1999,
respectively, from $878,972 and $2,501,151 for the three months and nine months
ended October 31, 1998, respectively. The principal components of cost of
revenues are salaries, telecommunication services and transaction processing
charges, interchange and surcharge rebates, ATM site rentals, maintenance and
repairs, and depreciation and amortization. This increase is principally due to
an increase in interchange and surcharge rebates paid to third party owners of
ATMs included in the Company's ATM network and to ATM site owners. Rebates
generally increase approximately in proportion to increases in total revenues
from interchange and surcharge fees. The increase is also attributable to
increased depreciation associated with the larger number of ATMs owned by the
Company, and increased telecommunications expenses associated with the larger
number of ATMs in the Company's network.

      Gross Margin. Gross profit as a percentage of revenues for the three
months and nine months ended October 31, 1999 was 26.7% and 28.6%, respectively,
and for the three months and nine months ended October 31, 1998 was 34.2% and
33.0%, respectively. The decrease for the three months and nine months ended
October 31, 1999 was caused by a number of factors, including increased
interchange and surcharge rebates, increased depreciation expense resulting from
the purchase of new ATMs and increased personnel expense and telecommunications
charges resulting from growth in the ATM network.

      Operating Expenses. The Company's total operating expenses were $375,381
and $1,089,723 for the three months and nine months ended October 31, 1999,
respectively, compared to $293,557 and $890,669 for the three months and nine
months ended October 31, 1998, respectively. The principal components of
operating expenses are administrative salaries and benefits, occupancy costs,
sales and marketing expenses and administrative expenses. This increase is
principally attributable to increased consulting fees and additional hiring
expenses, as well as increased professional fees incurred in connection with the
Company's efforts to resume filing periodic reports with the Securities and
Exchange Commission, the preparation and mailing of the proxy statement for the
1999 annual meeting of shareholders and the preparation and holding of the
annual meeting.

      Interest Expense. Interest expense increased to $79,052 and $161,090 for
the three months and nine months ended October 31, 1999, respectively, from
$48,055 and $127,918 for the three months and nine months ended October 31,
1998, respectively. This increase was attributable to increased rental of vault
cash from banks, capital lease obligations and notes payable related to the
acquisition of additional ATMs.

      Interest Income. The Company extends short-term loans to Funding, which
uses the proceeds as vault cash in the ATMs owned by Funding. These loans
generally have a term of one month and bear interest at 12% per annum. Interest
income primarily represents the interest paid by Funding to the Company on the
outstanding balance of these loans. Interest income increased to $20,062 and
$53,108 for the three months and nine months ended October 31, 1999,
respectively, from $9,908 and $22,268 for the three months and nine months ended
October 31, 1998, respectively, as a result of higher average outstanding
balances.

                                    Page - 12
<PAGE>


      Income Taxes. The Company paid no income taxes for the three months or
nine months ended October 31, 1999 and October 31, 1998, utilizing operating
loss carryforwards to reduce taxable income to zero. In addition, the Company
has recorded a deferred tax credit of $375,000 at January 31, 1999, which is
primarily a result of operating loss carryforwards which management believes are
more likely than not to be realized prior to their expiration between 2005 and
2012. Realization is dependent on generating sufficient future taxable income to
absorb the carryforwards. The amount of the deferred tax credit considered
realizable could be increased or reduced in the near term if estimates of future
taxable income during the carryforward period change. As of October 31, 1999,
the Company had approximately $195,000 of tax credits available to offset future
federal income taxes. These credits expire between 1999 and 2002. The Company
also has unused operating loss carryforwards of approximately $1,500,000, which
expire between 2005 and 2012.

      Net Income (Loss). The Company had a net loss of $14,696 or $.0004 per
share, for the three months ended October 31, 1999, compared to net income of
$124,552, or $0.0032 per share, for the three months ended October 31, 1998. The
Company had net income of $99,158, or $.0025 per share, for the nine months
ended October 31, 1999, compared to net income of $233,714, or $0.0060 per
share, for the nine months ended October 31, 1998. Net income for the three
months and the nine months ended October 31, 1999 was lower principally as a
result of substantially higher costs of revenues, operating expenses, as
described above, greater capital investment and a reduction in revenues received
from Funding.

Liquidity and Capital Resources

      At October 31, 1999, the Company had working capital deficit of $24,600,
compared to a working capital deficit of $145,914 at January 31, 1999. The ratio
of current assets to current liabilities improved to .97 at October 31, 1999
from .83 at January 31, 1999.

      The Company has funded its operations and capital expenditures from cash
flow generated by operations, capital leases and borrowings from lenders. Net
cash provided by operating activities was $510,165 for the nine months ended
October 31, 1999 and $640,813 for the nine months ended October 31, 1998. Net
cash provided in the nine months ended October 31, 1999 consisted primarily of
net income of $99,158, depreciation of $379,278 and an increase in accounts
payable and accrued expenses of $113,257, offset by an increase in accounts
receivable of $35,375 and an increase in prepaid expenses of $46,153.

      Net cash used in investing activities was $943,450 for the nine months
ended October 31, 1999 and $711,468 in the nine months ended October 31, 1998.
The increase in net cash used in investing activities resulted primarily from
increased purchases of plant and equipment (principally ATMs) of $293,150 and
an increase in notes receivable of $650,300 for the nine months ended October
31, 1999. Net cash used in financing activities was $168,637 for the nine months
ended October 31, 1999, compared to net cash used in financing activities of
$35,299 for the nine months ended October 31, 1998. The Company had no cash and
cash equivalents at October 31, 1999, compared to cash and cash equivalents of
$601,922 at January 31, 1999.

      Much of the Company's cash requirements relate to the need for vault cash
for ATMs owned by the Company and Funding. Funding currently provides vault cash
for a majority of these ATMs. See "Comparison of Results of Operations for the
Three Months and Nine Months Ended October 31, 1999 and October 31, 1998 -
Revenues from Funding" and the Company's

                                    Page - 13
<PAGE>


Annual Report on Form 10-KSB for the fiscal year ended January 31, 1999, Item 1,
"DESCRIPTION OF BUSINESS - Relationship with Universal Funding Corporation." At
October 31, 1999 and 1998, Funding had vault cash of approximately $3.4 million
and $2.2 million, respectively, located in approximately 246 and 208 ATMs,
respectively, owned by Funding and the Company. The Company, through its
subsidiary Electronic Funds Transfer, Inc. ("EFT"), lends funds to Funding for
vault cash to the extent that Funding cannot obtain financing on reasonable
terms from other sources and to the extent that the Company has cash available
to lend to Funding. The outstanding balance of the loans made by EFT to Funding
at October 31, 1999 was $650,300 and at October 31, 1998 was $415,000. Certain
of the ATMs owned by the Company are sponsored by banks. Vault cash for these
ATMs is supplied by the sponsoring bank. Vault cash for ATMs in the Company's
ATM network that are owned by banks and third party vendors is provided by the
ATM owner. In June 1999, the Company entered into an arrangement with Tehama
Bank to obtain a vault cash facility allowing the Company to obtain up to
$3 million in vault cash. As of October 31, 1999, the Company was renting
approximately $1.5 million under the Tehama Bank facility. In October 1999, the
Company entered into a similar arrangement with Charter Bank allowing the
Company to obtain up to $5 million in vault cash. As of October 31, 1999, the
Company was renting approximately $.8 million under the Charter Bank facility.
The Company is also engaged in discussions with one other bank regarding their
willingness to directly provide $1 million of vault cash for certain ATMs owned
by the Company.

      Management believes that the anticipated cash flow from operations will
provide the capital resources necessary to meet the Company's current working
capital needs and existing capital expenditure obligations. The Company expects
that its capital expenditures will increase in the future to the extent that the
Company is able to pursue its strategy of expanding its network and increasing
the number of installed ATMs. These increased expenditures are expected to be
funded from cash flow from operations, capital leases and additional borrowings,
to the extent financing is available. Expansion by the Company will depend on
continued access to credit under reasonable terms.

Impact of Inflation and Changing Prices

      While subject to inflation, the Company was not impacted by inflation
during the past two fiscal years in any material respect.

Year 2000 Compliance

      General Discussion. The Company defines the year 2000 issue as the result
of computer code being written using two digits to represent years rather than
four digits, which include the century designation. Without corrective action,
it is possible that computer programs could recognize a date using '00' as the
year 1900 rather than the year 2000. Additionally, certain equipment may contain
embedded chips that include date functions that may be affected by the
transition to the year 2000. In some systems, "Year 2000" problems could result
in a system failure or miscalculation causing disruptions of operations and the
inability to process transactions. The Company has chosen to follow the approach
that products should operate in accordance with their specifications and perform
substantially in the same manner in and after the year 2000 as they did before
the year 2000, subject to the information contained on this quarterly report.


                                    Page - 14
<PAGE>

      As an operator of an ATM network, the Company relies upon computers and
related telecommunications equipment for the operation of its business. The
Company acts as an intermediary for the transfer of data between its clients and
third parties, and in doing so, supplies the operating and technical resources
necessary to cause electronic data to be transmitted. The Company also owns and
operates ATMs, which utilize computer hardware and software to operate.

      The Company has recognized at the highest levels of management, the
significance of the issues regarding the upcoming rollover to a new century. In
1985, the Company implemented a policy requiring all program development making
date related processing decisions to do so using Julian dates. This form of date
processing is not sensitive to the century rollover. Therefore, by design, the
Company's internal systems were developed using a "Year 2000" ready philosophy.
Although this may have minimized to some extent the efforts the Company needed
to conduct the Year 2000 readiness review, management did not feel this lessened
responsibilities in any way regarding the need to verify Year 2000 readiness and
proceeded as if all programs and systems are vulnerable.


      The Company established an initiative called "Project 2000" which
encompassed an overall strategy to ensure a seamless transition into the next
millennium. The Company assigned a project coordinator who generally managed the
project, ensured that the project met or exceeded requirements set forth by
banking regulatory agencies including the Federal Deposit Insurance Corporation,
the Federal Reserve Bank, and the Office of the Comptroller of the Currency, and
assisted in identifying points of concern and providing solutions. Project 2000
focused upon the internal on-line switching systems and business continuity in
addition to assessing and assuring Year 2000 compliance from real-time
connections, product and service vendors and suppliers, auditors and customer
service.

      The Company has developed a Year 2000 Readiness Disclosure to provide its
customers with general information about the Year 2000 readiness of the Company,
as well as specific Year 2000 information about products and services. The
Company's Readiness Disclosure can be found on the company's website at
http://www.universalmoney.com

      Status of Year 2000 Readiness. The Company has completed its Project 2000
and considers itself Year 2000 ready. The overall state of readiness can be
assessed by describing its specific readiness in four key areas: (i) internal
switching systems, (ii) individual ATM's, (iii) contracted third party product
and service providers, and (iv) customer service and internal business
continuity. Project 2000 consisted of the following five phases: awareness,
assessment, corrective action, validation and implementation.

      The awareness phase consisted of defining the scope of the Year 2000
problem and establishing a corporate infrastructure and overall strategy to
perform compliance work. In the assessment phase, the Company attempted to
identify all hardware, software, networks, ATMs, other various processing
platforms and customer and vendor interdependencies affected by the Year 2000
problem. This assessment went beyond information systems and included equipment
and support systems that may be dependent on embedded microchips. The corrective
action phase involved code enhancements, hardware and software upgrades, system
replacements, vendor certification and other associated changes. The validation
phase involved the testing of incremental changes to hardware and software
components. In the implementation phase, systems were certified as Year 2000
compliant. For any systems that were are not determined to

                                    Page - 15
<PAGE>

be compliant, the consequences were assessed, and corrective actions or
contingency plans have been put into effect.

      Awareness Phase. The awareness phase is complete. Project2000 encompassed
an overall strategy to address Year 2000 problems. The Company's Project2000
focused chiefly upon the in-house, real-time, on-line systems, but also included
assessing and assuring year 2000 compliance from third parties. Because of the
seriousness of the year 2000 issues, the Company appointed a Project2000
Coordinator and established a Project2000 team consisting of the Coordinator,
all officers of the Company and the Accounting Manager.

      To determine the size of the compliance project relating to internal
systems, the Company searched all of its production computer programs for
references to, and actions taken by reference to, the date (year in particular),
and compiled a list of those programs for evaluation for Project2000 issues.
Date references that related to performing calculations or that provided
application program logic affecting the decision path of the application, and
date-driven calculations using "00" as an operand were identified. All third
parties whose ability to comply with Year 2000 problems might affect the
Company's operations, which include product and service vendors and suppliers,
card issuers other real-time connections, and clients were also identified.

      Assessment Phase. The assessment phase is complete. The assessment phase
included identification of all hardware, software, networks, ATMs, other various
processing platforms, customer and vendor interdependencies affected by the Year
2000 problem. This assessment went beyond information systems and included
equipment and support systems that may be dependent on embedded microchips.

      Internal Switching Systems. With respect to the Company's internal data
processing and transfer systems, in 1985, the Company implemented a policy
requiring all production programs making date-related processing decisions to do
so using Julian dates. This form of date processing is not sensitive to the
century rollover. Consequently, the Company's computer switch was developed
using a year 2000 compliant philosophy. The Company's switching hardware and
operating system are Year 2000 compliant. To assess its internal systems, the
Company evaluated all references to, and actions taken by reference to, the date
(year in particular), in its internal systems. The systems and equipment that
may be dependent upon embedded microprocessors were also examined. Conclusions
from the evaluation were that the Company's internal systems are Year 2000
compliant.

      The Company believes its conclusion is supported by the fact that the
Company's system is not highly date-dependent. The Company processes
transactions in segments from 2:00 p.m. one day through 2:00 p.m. the next day.
Consequently, the Company believes that the window of risk for the Company's
internal systems from the Year 2000 rollover should be limited to a maximum of
24 hours. The Company believes that its conclusion is further supported by the
fact that all of the application code was developed in-house, all source code is
intact and available, and the Company has the in-house expertise to revise and
maintain the software as needed for the year 2000 rollover. The PIN encryption
box utilized by the Company was identified as a critical component requiring
upgrade to maintain the Company's Year 2000 readiness.

      Individual ATMs. The Company tested transactions utilizing future dates on
all ATM models currently in use. Results of the testing indicated that
transactions to all but one ATM

                                    Page - 16
<PAGE>

model processed successfully. The NCR ATM Model 1773's were deemed to be non-
year 2000 compliant and were targeted for replacement.

      Third Party Products and Service. The Company attempted to obtain initial
certification from its "higher risk" vendors as to Year 2000 readiness. The
Company mailed questionnaires to these vendors to identify and, to the extent
possible, to resolve issues involving Year 2000 issues. Responses to these
questionnaires have been verified against information included with current
releases of vendors' products and services and on vendor web sites and are
shared with the Company's clients and regulatory agencies upon request. In
addition, the Company has engaged in joint testing with its high and medium risk
vendors and service providers, testing each party's system and the interface
between the systems. The Company believes that all mission critical vendors and
service providers have completed their internal Year 2000 corrective actions.
Service providers, vendors and suppliers whom the Company deems "no risk" were
not be contacted. The Company also coordinated with its clients regarding their
activities related to the Year 2000 problem. Most of the Company's clients
maintain their own application programs, although they utilize the Company's
computer and network resources. The Company conducted its own testing on the
systems of its largest clients, and did not discover any Year 2000 problems.

      Internal customer services and business continuity. In addition to
computers and related systems, the operation of office and facilities equipment,
such as desktop software, fax machines, telephones, voice mail, photocopiers,
security systems, air conditioning, fire systems and other common devices were
evaluated for potential risk as it pertains to the year 2000 problem. The
Company identified a few desktop software products, two desktops, voice mail and
the accounting software that required upgrades or replacement in order for the
Company to maintain its year 2000 readiness.

      Corrective Action Phase. The corrective action phase is complete. The
corrective action phase involved addressing compliance problems identified
during the assessment phase.

      Internal Switching Systems. Because the assessment phase revealed no
material Year 2000 problems, the Company did not plan any system replacements,
code enhancements or hardware or software upgrades. However, the Company will
continue to implement "mature" releases of the Tandem operating system and to
monitor Tandem Year 2000 Compliance statements regarding such releases. The PIN
encryption box utilized by the Company has been upgraded and installed.

      Individual ATMs. With respect to those ATMs that could be made Year 2000
compliant with the purchase of software upgrades from the manufacturer, the
Company has obtained the software upgrades and has completed the software
installation. The Company has completed replacement of the NCR model 1773 ATMs
that were identified for replacement in order to maintain year 2000 readiness.
As of December 15, 1999, the Company believes that 100% of its individual ATMs
are year 2000 compliant.

      Third Party Products and Services. Because no material Year 2000 problems
were discovered in the assessment phase, the Company did not initiate any
corrective action with respect to service providers, vendors, suppliers and
clients. However, the Company continues to test these connections to the
Company.


                                    Page - 17
<PAGE>

      Internal customer services and business continuity. The Company has
upgraded its accounting software. Desktop software needed to address business
continuity and customer service has been upgraded. An upgrade to the Company's
voice mail software has been tested and will be installed prior to the end of
December.

      Validation Phase. The validation phase is considered complete. However,
the Company will continue to test its internal systems, test its new and
upgraded ATMs for Year 2000 compliance and engage in further testing with
certain third parties.

      Internal Systems. Comprehensive tests were performed in September 1997,
November 1998, February 1999 and June 1999 on all of the Company's critical
applications. The tests revealed no Year 2000 problems. However, the Company
will continue to test and validate all incremental changes to hardware,
software, and connections with other systems as those changes (or additions)
occur in the ordinary course of business prior to Year 2000. All users of the
Company's products and services have been asked to validate the Company's Year
2000 compliance. For validation purposes, comprehensive Year 2000 tests of the
communication equipment, card production hardware and software and the Fedline
hardware and software were performed in November 1999. The validation testing
revealed no Year 2000 problems.

      Individual ATMs. The Company believes that replacement of all non-year
2000 compliant ATM machines has been completed.

      Third Party Compliance. The Company has reviewed the Year 2000 compliance
of its outside service providers, vendors, and suppliers and obtained written
"re-validated" certifications from all vendors. The Company continues to request
each outside service provider, vendor, and supplier to provide quarterly
statements of compliance through the end of 1999.

      Internal customer services and business continuity. The Company has
reviewed and updated its business resumption plan, which includes the Company's
internal operations and customer service. The objective of the Company's
business resumption plan is to continue normal operations in the case of a
severe business disruption. This plan addresses, but is not limited to, the year
2000 date rollover and includes year 2000 contingency considerations.

      Implementation Phase.  The implementation phase is considered complete.

      Internal Systems. The Company performed a final full internal system test
in June 1999. The test was performed using several dates in the year 2000. There
were no internal component or critical application failures. The PIN encryption
box utilized by the Company has been upgraded and installed. The Company
believes its internal systems are Year 2000 ready.

      Individual ATMs. The Company has completed installation of all ATM's
requiring upgrade to maintain their Year 2000 readiness. The Company believes
its ATM's are Year 2000 ready.

      Third Party Compliance. Because no material Year 2000 problems were
discovered in the assessment phase, the Company did not implement any corrective
action with respect to service providers, vendors, suppliers and clients. The
Company believes its critical providers, vendors, suppliers and clients are Year
2000 ready, but continues to request statements of Year 2000 compliance from
these persons.

                                    Page - 18
<PAGE>

     Internal customer services and business continuity. Desktop software
required to address business continuity and customer service has been upgraded.
The Company's accounting software has been upgraded to a Year 2000 compliant
version of the Soloman accounting software. An upgrade to the Company's voice
mail software has been tested and will be installed prior to the end of
December. The Company's internal operations are considered Year 2000 ready and
have documented departmental contingency plans in the event of an unplanned
critical event.

      Regulatory and Independent Assessment. In addition to developing an
internal risk assessment methodology with respect to Year 2000 issues, the
Company is subject to external examinations and project reviews by regulatory
agencies and governmental bodies of the federal government. To date, these
examinations have not identified any material issues regarding the Company's
Year 2000 compliance efforts.

      The Company hired an independent third party to act as an external
compliance "witness" to review and implement the Company's overall Year 2000
compliance, as well as verifying and validating the Company's Year 2000 risk.
The external compliance "witness" has been responsible for the following
activities: (i) facilitating maintenance of the vendor lists; (ii) assisting in
Year 2000 budgetary activities; (iii) reviewing, finalizing and facilitating
rehearsal of contingency plans; (iv) ensuring government and regulatory
recommendations are completed; (v) maintaining current Year 2000 status on the
Company's website; (vi) preparing readiness disclosure for the Company's
affiliated banks; and (vii) preparing project status for the Board of Directors.

      The Company's Project2000 team also continues to review the Company's
readiness for the Year 2000.

      Costs of Year 2000 Compliance. The principal cost incurred by the Company
in connection with Project2000 has been the cost of replacing obsolete ATM
equipment as part of the Company's ongoing process of upgrading and modernizing
its ATMs. As of July 31, 1999, approximately 60 NCR model 1773 ATMs currently in
operation were not Year 2000 compliant. All of these ATMs have been replaced.
The expected remaining cost of this project is approximately $20,000. The
Company has previously incurred approximately $466,000 in expenses related to
this project.

      The Company has not identified any other significant costs directly
relating to the Year 2000 problem. The cost of compliance testing of external
client systems is billed to the Company clients. Testing and repair, and the
day-to-day burden of Project2000 has consumed incremental overhead of managers
and executive officers of the Company. Such overhead has been effectively
absorbed with no material effect on budgets and operations.

      Possible Consequences of Year 2000 Problems. It is not possible to predict
with any certainty the extent and nature of Year 2000 problems that the Company
may encounter. Management believes that the following are possible consequences
of Year 2000 problems that could arise:

      o   operational inconveniences and inefficiencies for the Company and its
          clients which will divert management's time and attention and
          financial and human resources from ordinary business activities;

                                    Page - 19
<PAGE>

      o   serious system failures that will cause material business disruptions
          or require significant efforts by the Company or its clients to
          prevent or alleviate material business disruptions;

      o   routine  business  disputes  and  claims  for  pricing adjustments  or
          penalties due to Year 2000 Problems incurred by clients, which would
          be resolved in the ordinary course of business; and

      o   serious  business disputes alleging that the Company  failed to comply
          with the terms of contracts or industry standards of performance, some
          of which could result in litigation or contract termination.

      Contingency Plans. The Company has developed department-by-department
contingency plans to be implemented if its efforts to identify and correct Year
2000 Problems affecting its internal systems are not effective. Depending upon
the systems affected, these plans include accelerated replacement of affected
equipment or software; short- to medium-term use of backup sites, equipment, and
software, increased work hours for Company personnel; and similar approaches.

      Disclaimer. Management of the Company believes that it is not possible to
determine with complete certainty that all Year 2000 problems affecting the
Company or its clients have been or will be identified or corrected. The number
of devices that could be affected and the interactions among these devices are
simply too numerous. In addition, no one can accurately predict how many Year
2000-related failures will occur or the severity, duration, or financial
consequences of any such failure.

      The Company's policy is not to acquire hardware, software or other
technology that is not contractually represented by the vendor as Year 2000
compliant. However, the Company cannot be sure that all of these products are in
fact Year 2000 compliant. In addition, although the Company does not have any
contractual responsibility to ensure that its clients' application programs are
compliant, if its clients experience Year 2000 problems with such applications,
such clients may reduce or cease use of the Company's products and computing
resources. The successful operation of the Company's data processing and
transfer systems is dependent upon the proper functioning of the systems of
third parties that utilize the Company's services. Any failure of third parties
to resolve Year 2000 problems in a timely manner could materially adversely
affect the Company's operations.

      There can be no assurance that the Company will identify and resolve all
Year 2000 issues in a timely manner. Any failure by the Company to adequately
resolve all Year 2000 issues could have a material adverse effect on the
Company's business, financial condition, and results of operation.

      Forward-Looking Statements. The Company believes that many of the
statements contained in this discussion of Year 2000 issues may constitute
"forward-looking statements." These statements are not guarantees of future
performance or results. They involve risks, uncertainties and assumptions.
Consequently, actual results may differ materially from those discussed in these
forward-looking statements. See "- Cautionary Statement Concerning
Forward-Looking Statements" for additional information and factors to be
considered with respect to forward-looking statements.

                                    Page - 20
<PAGE>



Future Changes in Accounting Principles

      In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities." This Statement establishes the accounting
for derivative instruments, including certain derivative instruments imbedded in
other contracts and hedging activities. This Statement is effective for all
fiscal quarters of fiscal years beginning after June 15, 1999. Management has
not yet determined the impact of adopting this pronouncement on the Company's
results of operations or financial position.

      In March 1998, the AICPA issued SOP 98-1, "Accounting for the Costs of
Computer Software Developed or Obtained for Internal Use." This SOP provides
guidance on accounting for the costs of computer software developed or obtained
for internal use. This SOP is effective for fiscal years beginning after
December 15, 1998. Management has not yet determined the impact of adopting this
pronouncement on the Company's results of operations or financial position.

Cautionary Statement Concerning Forward-Looking Statements

      The Company believes that certain statements contained in this Quarterly
Report on Form 10-QSB that are not statements of historical fact may constitute
"forward-looking statements" within the meaning of Section 21E of the Exchange
Act. These statements are subject to risks and uncertainties, as described
below.

      Examples of forward-looking statements include, but are not limited to:
(i) projections of revenues, income or loss, earnings or loss per share, capital
expenditures, the payment or non-payment of dividends, capital structure and
other financial items, (ii) statements of plans and objectives of the Company or
its management or Board of Directors, including plans or objectives relating to
the products or services of the Company, (iii) statements of future economic
performance, and (iv) statements of assumptions underlying the statements
described in (i), (ii) and (iii). Forward-looking statements can often be
identified by the use of forward-looking terminology, such as "believes,"
"expects," "may," "will," "should," "could," "intends," "plans," "estimates" or
"anticipates," variations thereof or similar expressions.

      Forward-looking statements are not guarantees of future performance or
results. They involve risks, uncertainties and assumptions. The Company's future
results of operations, financial condition and business operations may differ
materially from those expressed in these forward-looking statements. Investors
are cautioned not to put undue reliance on any forward-looking statement.

      There are a number of factors that could cause actual results to differ
materially from those discussed in the forward-looking statements, including
those factors described below. Other factors not identified herein could also
have such an effect. Among the factors that could cause actual results to differ
materially from those discussed in the forward-looking statements are the
following:

   o     Changes in laws or card association rules affecting the Company's
         ability to impose surcharge fees, and continued customer willingness to
         pay surcharge fees;

   o     Public perception of ATM fees, and availability and use of currently
         no-fee debit cards;


                                    Page - 21
<PAGE>

   o     The ability of the Company to form new strategic relationships and
         maintain existing relationships with issuers of credit cards and
         national and regional card organizations;

   o     The ability of the Company to expand its ATM base and transaction
         processing business;

   o     The availability of financing at reasonable rates for vault cash and
         for other corporate purposes, including funding the Company's expansion
         plans;

   o     The ability of the Company to maintain its existing relationships with
         two operators of combination convenience stores and gas stations at
         which the Company maintains 44 and 43 ATMs, respectively, as of October
         31, 1999;

   o     The ability of the Company to maintain its relationship with Kmart
         allowing the Company to operate and manage approximately 147 ATMs,
         including the 58 ATMs leased by the Company as of November 1, 1999.

   o     The ability of the Company to keep its ATMs at other existing locations
         at reasonable rental rates and to place additional ATMs in preferred
         locations at reasonable rental rates;

   o     The extent and nature of competition from financial institutions,
         credit card processors and third party operators, many of whom have
         substantially greater resources than the Company;

   o     The ability of the Company to maintain its ATMs and information systems
         technology without significant system failures or breakdowns;

   o     The ability of the Company to cause its ATMs and information systems to
         be Year 2000 compliant and the extent to which the systems of card
         issuers, card organizations, banks and other companies on which the
         Company's systems rely are Year 2000 compliant;

   o     The extent of vault cash losses from certain ATMs funded by Funding,
         for which the Company does not maintain insurance;

   o     The ability of the Company to develop new products and enhance existing
         products to be offered through ATMs, and the ability of the Company to
         successfully market these products;

   o     The ability of the Company to identify suitable acquisition candidates,
         to finance and complete acquisitions and to successfully integrate
         acquired assets and businesses into existing operations;

   o     The ability of the Company to retain senior management and other key
         personnel;

   o     Changes in general economic conditions.


                                    Page - 22
<PAGE>


Any forward-looking statement contained herein is made as of the date of this
document. The Company does not undertake to publicly update or correct any of
these forward-looking statements in the future.



                           PART II - OTHER INFORMATION


Item - 6    Exhibits and Reports on Form 8-K.


      (a)   Exhibits

            The exhibits required by this item are listed in the Index to
Exhibits set forth at the end of this Form 10-QSB.


      (b)   Reports on Form 8-K

            The Company did not file any reports on Form 8-K during the quarter
ended October 31, 1999.







                                    Page - 23
<PAGE>


                                   SIGNATURES


      In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.


                                    UNIVERSAL MONEY CENTERS, INC.
                                    (Registrant)


Date: December 15, 1999             By: /s/ David S. Bonsal
                                        _______________________________________
                                        David S. Bonsal
                                        Chairman of the Board
                                        and Chief Executive Officer



Date: December 15, 1999             By: /s/ John L. Settles
                                        _______________________________________
                                        John L. Settles
                                        President
                                        (Principal Financial and Accounting
                                        Officer)




                                    Page - 24
<PAGE>



                                INDEX TO EXHIBITS

Exhibit
Number                              Description
-------                             -----------

3.1*              Articles of Incorporation of the Company, as amended

3.2*              Amended and Restated Bylaws of the Company

4.1*              Promissory Note dated June 3, 1996 issued by the Company to
                  Bank 21 (formerly The Farmers Bank)

4.2*              Business Loan Agreement dated June 3, 1996 between
                  the Company and Bank 21 (formerly The Farmers
                  State Bank)

4.3*              Promissory Note dated August 26, 1996 issued by
                  the Company to Bank 21 (formerly The Farmers State
                  Bank)

4.4*              Business Loan Agreement dated August 26, 1996
                  between the Company and Bank 21 (formerly The
                  Farmers State Bank)

4.5*              Commercial Security Agreement dated August 26,
                  1996 between the Company and Bank 21 (formerly The
                  Farmers State Bank)

4.6**             Promissory Note dated April 9, 1998 issued by the Company to
                  Bank 21 (formerly The Farmers Bank)

4.7**             Negative Pledge Agreement dated April 9, 1998
                  between the Company and Bank 21 (formerly The
                  Farmers State Bank)

4.8**             Commercial Security Agreement dated April 9, 1998
                  between the Company and Bank 21 (formerly The
                  Farmers State Bank)

10.1              Master Lease Agreement dated February 28, 1998 between the
                  Company and Diebold Credit Corporation (Incorporated by
                  reference from Exhibit 10.8 to the registrant's Quarterly
                  Report on Form 10-QSB for the quarter ended April 30, 1998).

10.2              Lease Schedule dated April 20, 1998 between the Company and
                  Diebold Credit Corporation (Incorporated by reference from
                  Exhibit 10.9 to the registrant's Quarterly Report on Form
                  10-QSB for the quarter ended April 30, 1998).

10.3              Assignment and Delegation dated September 25, 1998 among the
                  Company, as assignor, Diebold Incorporated, as seller, and
                  Diebold Credit Corporation, as assignee (Incorporated by
                  reference from Exhibit 10.10 to


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<PAGE>


                  the registrant's Quarterly Report on Form 10-QSB for the
                  quarter ended October 31, 1998).

10.4              Master Lease Agreement dated November 20, 1998 between the
                  Company and Dana Commercial Credit (Incorporated by
                  reference from Exhibit 10.11 to the registrant's Annual
                  Report on Form 10-KSB for the fiscal year ended January 31,
                  1999).

10.5              Master Lease Agreement dated January 18, 1999 between the
                  Company and Dana Commercial Credit (Incorporated by
                  reference from Exhibit 10.12 to the registrant's Annual
                  Report on Form 10-KSB for the fiscal year ended January 31,
                  1999).

10.6              Lease Schedule No. 2 dated May 11, 1999 to the Master Lease
                  Agreement dated January 18, 1999 between the Company and Dana
                  Commercial Credit (Incorporated by reference from Exhibit 10.1
                  to the registrant's Quarterly Report on Form 10-QSB for the
                  quarter ended July 31, 1999).

10.7              Lease Schedule No. 3 dated June 2, 1999 to the Master Lease
                  Agreement dated January 18, 1999 between the Company and Dana
                  Commercial Credit (Incorporated by reference from Exhibit 10.2
                  to the registrant's Quarterly Report on Form 10-QSB for the
                  quarter ended July 31, 1999).

10.8              Lease Schedule No. 4, dated October 1, 1999 and accepted
                  October 31, 1999, to the Master Lease Agreement dated January
                  18, 1999 between the Company and Dana Commercial Credit
                  (incorporated by reference from Exhibit 10.2 to the
                  registrant's Current Report on Form 8-K dated October 31,
                  1999).

27                Financial Data Schedule


* Incorporated by reference from the exhibit to the registrant's Annual Report
on Form 10-KSB for the fiscal year ended January 31, 1998 which bears the same
exhibit number.

** Incorporated by reference from the exhibit to the registrant's Quarterly
Report on Form 10-QSB for the quarter ended April 30, 1998 which bears the same
exhibit number.


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