SECURITIES AND EXCHANGE COMMISSION

                              WASHINGTON, DC 20549

                                    FORM 10-Q


                   QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934



          For the quarterly period ended Commission file number 0-13848
                                  June 30, 2000

                           ___________________________


                                CONCORD EFS, INC.

             (Exact name of registrant as specified in its charter)


                               Delaware 04-2462252
              ______________________________ _____________________

                  (State or other jurisdiction of (IRS Employer
              Incorporation of Organization) Identification Number)


          2525 Horizon Lake Drive, Suite 120, Memphis, Tennessee 38133
                    (Address of Principal Executive Offices)
                                 (901) 371-8000
              (Registrant's telephone number, including area code)

                                _________________


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 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[ ]

The number of shares of the registrant's Common Stock,  $0.33 1/3 par value,  as
of August 11, 2000 was 212,680,489.

<PAGE>
                       CONCORD EFS, INC. AND SUBSIDIARIES


                                     INDEX



                                                                       Page No.
                                                                       --------
PART 1 - Financial Information

Item 1. Financial Statements (Unaudited)

  Condensed Consolidated Statements of Income Three
   Months and Six Months ended June 30, 2000 and June 30, 1999            1

  Condensed Consolidated Balance Sheets as of June 30, 2000
   and December 31, 1999                                                  3

  Condensed Consolidated Statements of Cash Flows
   Six Months ended June 30, 2000 and June 30, 1999                       5

  Notes to Condensed Consolidated Financial Statements                    6

Item 2. Management's Discussion and Analysis of Financial
  Condition and Results of Operations                                    12

Item 3. Quantitative and Qualitative Disclosures About
  Market Risk                                                            17

PART II - Other Information

Item 2:  Changes in Securities and Use of Proceeds                       18

Item 6. Exhibits and Reports on Form 8-K                                 18


Signatures                                                               19


<PAGE>
                       CONCORD EFS, INC. AND SUBSIDIARIES
                   CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                                   (UNAUDITED)

                                Three Months Ended          Six Months Ended
                                      June 30                    June 30
                             -----------------------     -----------------------
                                2000          1999          2000         1999
                             ---------     ---------     ---------     ---------
                                    (In thousands, except per share data)

Revenue                      $290,123      $203,556      $547,891      $381,602

Cost of operations            214,337       144,850       407,600       271,385

Selling, general and
 administrative expenses       12,261        13,102        24,785        25,907

Acquisition expenses and
 restructuring charges             -             -            776        34,810
                             ---------     ---------     ---------     ---------
          OPERATING INCOME     63,525        45,604       114,730        49,500

Other income (expense):
 Interest income               10,182         5,481        19,327        10,746
 Interest expense              (2,236)       (3,611)       (4,300)       (7,144)
                             ---------     ---------     ---------     ---------

       INCOME BEFORE TAXES     71,471        47,474       129,757        53,102

Income taxes                   25,484        16,632        46,181        23,601
                             ---------     ---------     ---------     ---------
                NET INCOME   $ 45,987      $ 30,842      $ 83,576      $ 29,501
                             =========     =========     =========     =========

Pro forma provision
 for income taxes                               536           260         1,055
                             ---------     ---------     ---------     ---------
      PRO FORMA NET INCOME   $ 45,987      $ 30,306      $ 83,316      $ 28,446
                             =========     =========     =========     =========














                                       -1-
<PAGE>
                       CONCORD EFS, INC. AND SUBSIDIARIES
             CONDENSED CONSOLIDATED STATEMENTS OF INCOME - CONTINUED
                                   (UNAUDITED)

                                Three Months Ended          Six Months Ended
                                      June 30                    June 30
                             -----------------------     -----------------------
                                2000          1999          2000         1999
                             ---------     ---------     ---------     ---------

HISTORICAL AND PRO FORMA
 PER SHARE DATA:

 Basic earnings              $   0.22      $   0.15      $   0.39      $   0.15
                             =========     =========     =========     =========

 Diluted earnings            $   0.21      $   0.15      $   0.38      $   0.14
                             =========     =========     =========     =========

 Average basic shares
  outstanding                 212,311       199,839       212,238       199,043
                             =========     =========     =========     =========

 Average diluted shares
  outstanding                 219,070       207,323       218,284       206,604
                             =========     =========     =========     =========

See Notes to Condensed Consolidated Financial Statements - Unaudited.


























                                       -2-
<PAGE>
                       CONCORD EFS, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                   (UNAUDITED)

                                                        June 30      December 31
                                                          2000           1999
                                                     -------------  ------------
                                                            (in thousands)
ASSETS

CURRENT ASSETS
  Cash and cash equivalents                           $  122,226     $  121,001
  Securities available for sale                          505,029        456,209
  Accounts receivable, net                               137,834        161,872
  Inventories                                             18,198         18,076
  Prepaid expenses and other current assets               17,189         11,376
  Deferred income taxes                                   10,440          9,108
                                                     ------------   ------------
TOTAL CURRENT ASSETS                                     810,916        777,642

LOANS, net                                                67,842         30,391

PROPERTY AND EQUIPMENT, net                              181,330        167,829

GOODWILL, net                                             55,039         54,046

OTHER INTANGIBLE ASSETS, net                              63,398         57,186

OTHER ASSETS                                               9,604         15,787
                                                     ------------   ------------
TOTAL ASSETS                                          $1,188,129     $1,102,881
                                                     ============   ============

See notes to condensed consolidated financial statements.




















                                       -3-
<PAGE>
                       CONCORD EFS, INC. AND SUBSIDIARIES
                CONDENSED CONSOLIDATED BALANCE SHEETS - CONTINUED
                                   (UNAUDITED)

                                                        June 30      December 31
                                                          2000           1999
                                                     -------------  ------------
                                                            (in thousands)
LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
  Accounts payable and other liabilities              $  115,032     $  129,217
  Deposits                                               115,037        100,475
  Accrued liabilities                                     45,753         50,435
  Income taxes payable                                    16,833         16,370
                                                     ------------   ------------
TOTAL CURRENT LIABILITIES                                292,655        296,497
                                                     ------------   ------------

LONG-TERM DEBT                                            76,000         75,000
DEFERRED INCOME TAXES                                     18,899         16,566
OTHER LIABILITIES                                          4,962          9,669
                                                     ------------   ------------
TOTAL LIABILITIES                                        392,516        397,732
                                                     ------------   ------------

COMMITMENTS AND CONTINGENT LIABILITIES

STOCKHOLDERS' EQUITY
  Common stock                                            70,810         70,703
  Other stockholders' equity                             724,803        634,446
                                                     ------------   ------------
TOTAL STOCKHOLDERS' EQUITY                               795,613        705,149
                                                     ------------   ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY            $1,188,129     $1,102,881
                                                     ============   ============

See notes to condensed consolidated financial statements.
















                                       -4-
<PAGE>
                       CONCORD EFS, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)

                                                            Six Months Ended
                                                                June 30
                                                         -----------------------
                                                            2000         1999
                                                         ----------   ----------
                                                             (In thousands)

NET CASH PROVIDED BY OPERATING ACTIVITIES                 $117,444     $ 67,248

INVESTING ACTIVITIES:
 Acquisition of securities available for sale              (97,328)    (101,334)
 Sale of securities available for sale                      30,280       28,020
 Maturities of securities available for sale                14,644       11,784
 Acquisition of property and equipment                     (33,453)     (25,102)
 Loans purchased                                           (42,134)      (9,187)
 Loan principal payments received                            4,398          357
 Merchants contracts purchased                             (12,569)      (7,933)
 Other, net                                                 (2,106)          -
                                                         ----------   ----------
NET CASH USED IN INVESTING ACTIVITIES                     (134,056)    (103,395)

FINANCING ACTIVITIES:
 Net increase in deposits                                   14,562       33,692
 Proceeds from sale of common stock                          3,244      222,139
 Proceeds from notes payable                                19,000        7,000
 Payments under credit agreement, net                           -       (21,000)
 Payments on notes payable                                 (18,969)    (125,116)
                                                         ----------   ----------
NET CASH PROVIDED BY FINANCING ACTIVITIES                   17,837      116,715
                                                         ----------   ----------
INCREASE IN CASH AND CASH EQUIVALENTS                        1,225       80,568

Cash and cash equivalents
 at beginning of period                                    121,001       82,890
                                                         ----------   ----------
CASH AND CASH EQUIVALENTS AT END OF PERIOD                $122,226     $163,458
                                                         ==========   ==========

See notes to condensed consolidated financial statements.











                                       -5-
<PAGE>
                       CONCORD EFS, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)
                                  JUNE 30, 2000


Note A - Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial  information and with the  instructions to Form 10-Q and Article 10 of
Regulations  S-X.  Accordingly,  they do not include all of the  information and
footnotes  required by generally  accepted  accounting  principles  for complete
financial statements.  In the opinion of management all adjustments,  consisting
of normal recurring accruals,  considered necessary for a fair presentation have
been  included.  Operating  results for the six month period ended June 30, 2000
are not necessarily  indicative of the results that may be expected for the year
ended  December 31, 2000.  For further  information,  refer to the  consolidated
financial statements and footnotes thereto included in the Concord EFS, Inc. and
Subsidiaries  (Company)  annual report on Form 10-K for the year ended  December
31, 1999.

Restatement of Historical Financial Information

The  historical  financial  information  presented  herein has been  restated in
accordance  with  pooling  of  interests   method  of  accounting  for  business
combinations.   The  financial  information  reflects  the  financial  position,
operating  results  and cash  flows of the  respective  companies  as though the
companies were combined for all periods presented.

Certain amounts have been reclassified from prior period consolidated  financial
statements to conform with the current year presentation.

Note B - Recent Acquisitions

On February 1, 2000,  the Company  acquired Card Payment  Systems  (CPS),  a New
York-based  reseller  of  payment  processing  services.   The  acquisition  was
accounted for as a pooling of interests  transaction in which Concord issued 6.2
million shares of its common stock. CPS provides  card-based  payment processing
services to independent  sales  organizations  (ISOs),  which in turn sell those
services to retailers.

CPS was an S-Corporation  for tax purposes prior to its merger with Concord.  As
such, the former owners of CPS were responsible for income taxes for the periods
prior to the merger rather than the Company.  The results of operations  include
pro  forma  income  taxes  that  would  have  been  required  if CPS had  been a
C-Corporation.








                                       -6-
<PAGE>
                       CONCORD EFS, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued
                                   (UNAUDITED)
                                  JUNE 30, 2000


Note B - Recent Acquisitions - continued

The following table represents  selected  unaudited  financial  information,  in
thousands, split between the Company and CPS:

                              Three months ended           Six months ended
                                   June 30                      June 30
                            ---------------------       ---------------------
                              2000         1999           2000         1999
                            --------     --------       --------     --------
                                 (Unaudited)                  (Unaudited)
Pro forma revenue

  Concord EFS, Inc.         $290,123     $193,724       $543,844     $363,958
  CPS (1)                                   9,832          4,047       17,644
                            --------     --------       --------     --------
  Combined                  $290,123     $203,556       $547,891     $381,602
                            ========     ========       ========     ========

Pro forma net income

  Concord EFS, Inc.         $ 45,987     $ 29,266        $82,926     $ 26,398
  CPS (1)                                   1,576            650        3,103
  Pro forma provision
    for CPS income
    taxes (2)                                 536            260        1,055
                            --------     --------       --------     --------
  Combined                  $ 45,987     $ 30,306        $83,316     $ 28,446
                            ========     ========       ========     ========

Pro forma basic earnings
  per share combined          $0.22        $0.15          $0.39        $0.14
                            ========     ========       ========     ========
Pro forma diluted earnings
  per share combined          $0.21        $0.15          $0.38        $0.14
                            ========     ========       ========     ========


(1)  The six months  ended June 30,  2000  amounts  reflect  the  results of CPS
     operations from January 1, 2000 through January 31, 2000  (unaudited).  The
     CPS  results  of  operations  from  February  1, 2000 to June 30,  2000 are
     included in Concord EFS, Inc. amounts.

(2)  CPS  terminated its  S-Corporation  election at the time of the merger with
     the Company.




                                       -7-
<PAGE>
                       CONCORD EFS, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued
                                   (UNAUDITED)
                                  JUNE 30, 2000


Note B - Recent Acquisitions - continued

On February 7, 2000 the  Company  announced  completion  of its  acquisition  of
Virtual Cyber Systems  (VCS),  an internet  software  development  company.  The
acquisition  of VCS,  for which the Company paid  approximately  $1.7 million in
common stock,  was accounted for as a purchase  transaction and is immaterial to
the Company's financial statements.

On April 13,  2000,  Concord EFS  announced an agreement to acquire Cash Station
Inc., an electronic  funds  transfer  network  based in Chicago,  Illinois.  The
acquisition  is to be accounted for as a pooling of interests  transaction.  The
acquisition  is  expected  to close by October 1,  2000,  subject to  regulatory
approval and other customary  closing  conditions.  The acquisition will have an
immaterial impact on the financial statements of Concord EFS.

Note C - Offering of Common Stock

Previous  owners  of  Electronic  Payment  Systems,  Inc.  (EPS) and VCS who had
received  unregistered  common  stock of the  Company in  connection  with their
respective  acquisitions  sold 665,275  shares of common stock in a registration
statement  filed May 15, 2000. The Company did not receive any proceeds from the
sale of shares by the previous owners of EPS or VCS.

Note D - Comprehensive Income

Total comprehensive income was $47,443 and $24,764, in thousands,  for the three
months ended, June 30, 2000 and 1999,  respectively.  Total comprehensive income
was $85,186 and $22,544,  in thousands,  for the six months ended, June 30, 2000
and 1999, respectively.



















                                       -8-
<PAGE>
                       CONCORD EFS, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued
                                   (UNAUDITED)
                                  JUNE 30, 2000


Note E - Earnings Per Share

The following  table sets forth the  computation  of basic and diluted  earnings
(loss) per share (in thousands, except per share data):


                                      Three Months Ended      Six Months Ended
                                            June 30               June 30
                                       2000         1999       2000        1999
                                     -------      -------    -------     -------
Numerator:
 Net income                          $45,987      $30,842    $83,576     $29,501
                                     =======      =======    =======     =======
Denominator:
 Denominator for basic earnings
 per share, weighted-average
 shares                              212,311      199,839    212,238     199,043

 Effect of dilutive securities,
 employee stock options                6,759        7,484      6,046       7,561
                                     -------      -------    -------     -------
 Denominator for diluted earnings
 per share adjusted for weighted-
 average shares and assumed
 conversions                         219,070      207,323    218,284     206,604
                                     =======      =======    =======     =======

Basic earnings per share              $0.22        $0.15      $0.39       $0.15
                                     =======      =======    =======     =======

Diluted earnings per share            $0.21        $0.15      $0.38       $0.14
                                     =======      =======    =======     =======

Excluding  acquisition costs and restructuring charges described in management's
discussion and analysis of financial condition and results of operations,  basic
earnings per share for the six month  periods  ended June 30, 2000 and 1999 were
$0.40 and $0.28, respectively,  and diluted earnings per share for the six month
periods ended June 30, 2000 and 1999 were $0.39 and $0.27, respectively.

Earnings per share and related per share data have been  restated to reflect all
stock splits.







                                       -9-
<PAGE>
                       CONCORD EFS, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued
                                   (UNAUDITED)
                                  JUNE 30, 2000


Note F - Segment Information

Industry segment information,  in thousands,  for the three and six months ended
June 30, 2000 and 1999 is presented  below.  Merchant  Services and ATM Services
segments are described in the Overview  section to  Management's  Discussion and
Analysis  of  Financial  Condition  and Results of  Operations  included in this
filing.

                              Merchant       ATM
                              Services     Services      Other         Total
                             ----------   ----------   ----------   ----------
Three months ended
 June 30, 2000
  Revenue                     $208,658     $ 78,524    $   2,941    $ 290,123
  Cost of operations          (168,729)     (44,511)      (1,097)    (214,337)
  Selling, general, &
   administrative expenses                               (12,261)     (12,261)
  Taxes & interest, net                                  (17,538)     (17,538)
                             ----------   ----------   ----------   ----------
  Net income (loss)           $ 39,929     $ 34,013    $ (27,955)   $  45,987
                             ==========   ==========   ==========   ==========

Three months ended
 June 30, 1999
  Revenue                     $142,948     $ 56,704    $   3,904    $ 203,556
  Cost of operations          (111,980)     (32,398)        (472)    (144,850)
  Selling, general, &
   administrative expenses                               (13,102)     (13,102)
  Taxes & interest, net                                  (14,762)     (14,762)
                             ----------   ----------   ----------   ----------
  Net income (loss)           $ 30,968     $ 24,306    $ (24,432)   $  30,842
                             ==========   ==========   ==========   ==========
















                                      -10-
<PAGE>
                       CONCORD EFS, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued
                                   (UNAUDITED)
                                  JUNE 30, 2000


Note F - Segment Information - continued

Industry segment  information,  in thousands,  for the six months ended June 30,
2000 and 1999 is presented below:

                              Merchant       ATM
                              Services     Services      Other         Total
                             ----------   ----------   ----------   ----------
Six months ended
 June 30, 2000
  Revenue                     $392,769     $149,503    $   5,619    $ 547,891
  Cost of operations          (316,130)     (89,459)      (2,011)    (407,600)
  Selling, general, &
   administrative expenses                               (24,785)     (24,785)
  Acquisition &
   restructuring charges          (776)                                  (776)
  Taxes & interest, net                                  (31,154)     (31,154)
                             ----------   ----------   ----------   ----------
  Net income (loss)           $ 75,863     $ 60,044    $ (52,331)   $  83,576
                             ==========   ==========   ==========   ==========

Six months ended
 June 30, 1999
  Revenue                     $263,085     $109,153    $   9,364    $ 381,602
  Cost of operations          (203,563)     (64,111)      (3,711)    (271,385)
  Selling, general, &
   administrative expenses                               (25,907)     (25,907)
  Acquisition &
   restructuring charges                                 (34,810)     (34,810)
  Taxes & interest, net                                  (19,999)     (19,999)
                             ----------   ----------   ----------   ----------
  Net income (loss)           $ 59,522     $ 45,042    $ (75,063)   $  29,501
                             ==========   ==========   ==========   ==========















                                      -11-
<PAGE>
                       CONCORD EFS, INC. AND SUBSIDIARIES
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS


This Form 10-Q may contain or  incorporate  by  reference  statements  which may
constitute "forward-looking"  information,  within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the Securities Act of
1934, as amended.  Any such statements are not guarantees for future performance
and involve risks and  uncertainties,  and actual results may differ  materially
from those contemplated by such  forward-looking  statements.  Important factors
that  could  cause   actual   results  to  differ   materially   from  those  in
forward-looking statements include (i) the loss of key personnel or inability to
attract additional qualified personnel,  (ii) changes in card association rules,
(iii) changes in card  association  fees, (iv)  restrictions on surcharging or a
decline in the deployment of automated teller  machines,  (v) dependence on VISA
and MasterCard registrations,  (vi) the credit risk of merchant customers, (vii)
susceptibility  to fraud at the merchant  level,  (viii)  receiving  lower price
margins from higher volume merchants, (ix) increasing competition,  (x) the loss
of key  customers,  (xii)  continued  consolidation  in the  banking  and retail
industries,  (xii) risks related to  acquisitions,  (xiii)  changes in rules and
regulations  governing  financial  institutions,  (xiv) the  inability to remain
current with rapid technological change, (xv) dependence on third-party vendors,
(xvi) the  imposition  of  additional  state  taxes,  (xvii)  volatility  of the
Company's  common stock price and (xviii) changes in interest rates. The Company
undertakes  no  obligation  to update or revise  forward-looking  statements  to
reflect changed  assumptions,  the occurrence of unanticipated events or changes
to future results over time.

Restatement of Historical Financial Information

The  historical  financial  information  presented  herein has been  restated in
accordance  with  pooling  of  interests   method  of  accounting  for  business
combinations.   The  financial  information  reflects  the  financial  position,
operating  results  and cash  flows of the  respective  companies  as though the
companies were combined for all periods presented.

Overview

The Company is a fully  integrated  leading  provider of electronic  transaction
authorization,   processing,   settlement  and  funds  transfer  services  on  a
nationwide  basis.  The Company focuses on marketing its services to supermarket
chains and  multiple  lane  retailers,  financial  institutions,  petroleum  and
convenience  stores,  grocery stores, the trucking industry and other retailers.
The  Company's  primary  activity  is  Merchant  Services,  in which it provides
integrated  electronic  transaction  services  for credit  card,  debit card and
electronic benefits transfer (EBT) card transactions. These transaction services
include data capture,  authorization  and  settlement  services for over 400,000
point-of-sale  terminals.  The Company also provides  automated  teller  machine
(ATM) Services,  consisting of owning and operating the  MAC-branded  electronic
funds transfer network and processing for approximately  42,000 ATMs nationwide,
of which it owns approximately 1,000.


                                      -12-
<PAGE>
                       CONCORD EFS, INC. AND SUBSIDIARIES
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
          OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued


Overview - continued

The  substantial  majority of the Company's  revenue (71.9% in 2000 and 70.2% in
1999) is generated from fee income related to Merchant Services.  These services
include:

 -- the processing of credit card transactions for all major credit card brands
    including VISA, MasterCard, American Express, Discover and Diners Club;

 -- the processing of debit card transactions occurring at point of sale
    terminals at our merchants' businesses; and

 -- the provision of electronic payment services to supermarket chains and
    multiple lane retailers, financial institutions, petroleum and convenience
    stores, grocery stores, trucking companies and other retailers.

Revenue from Merchant  Services  consists  primarily of discount fees charged to
merchants,  which are a  percentage  of the dollar  amount of each  credit  card
transaction  the  Company  processes,  and  may  also  include  a flat  fee  per
transaction.  The discount fee is  negotiated  with each  merchant and typically
constitutes  a  bundled  rate  for the  transaction  authorization,  processing,
settlement  and funds transfer  services we provide.  This revenue and fees from
other  transactions  are recognized at the time the merchants'  transactions are
processed.

ATM  Services  revenue  consists  of  processing  fees for third  party ATMs and
terminals,  and other access, switching and card processing fees, and fee income
and other  surcharges  charged for  proprietary  ATMs.  ATM Services  revenue is
recognized at the time of the transaction.

The remaining balance of the Company's revenue is derived principally from check
verification and authorization services and sales of point-of-sale terminals.

Cost of operations includes all costs directly  attributable to the provision of
services to the Company's customers.  The most significant  component of cost of
operations  includes  interchange and assessment fees, which are amounts charged
by the credit and debit card  associations.  Interchange and assessment fees are
billed  primarily as a percentage  of dollar volume  processed  and, to a lesser
extent,   as  a   per-transaction   fee.  Cost  of   operations   also  includes
telecommunications costs, occupancy costs,  depreciation,  the cost of equipment
leased  and  sold,  operating  salaries  and  wages,  amortization  of  merchant
contracts and other intangibles, the cost of operating the Company's MAC network
and other miscellaneous merchant supplies and services expenses.

The Company's selling,  general and administrative expenses include salaries and
wages and other general administrative  expenses (including certain amortization
costs).


                                      -13-
<PAGE>
                       CONCORD EFS, INC. AND SUBSIDIARIES
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
          OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued


Results of Operations

Revenue  increased  42.5% to $290.1  million in the second  quarter of 2000 from
$203.6  million  in the  second  quarter  of  1999.  Of 2000  revenue,  Merchant
Services,  ATM Services and Other Services  accounted for 71.9%, 27.1% and 1.0%,
respectively of revenue.  Revenue from merchant card services,  increased 46.0%,
due primarily to increased  transactional  volumes.  Increased  volumes resulted
from adding new merchants, increasing acceptance of electronic payment cards and
the  cross-selling  of  settlement  processing  to  several  EPS  higher  volume
merchants. ATM Services revenue increased 38.5%. Increased transactional volumes
and  in-house  processing  of the EPS  off-line  debit  product were the primary
factors for the increase.  Other revenues decreased 24.7% due primarily to lower
terminal sales.

Net income as a  percentage  of revenue was 15.9% in the second  quarter of 2000
compared to 15.2% in the second quarter of 1999. The margin  improvement was the
result of a combination  of factors.  Improvements,  as a percentage of revenue,
were made in  selling,  general and  administrative  expenses  and net  interest
income.  These  improvements were partially offset by an increase in the cost of
operations as a percentage of revenue.

Cost of operations  increased in the second  quarter of 2000 to 73.9% of revenue
compared to 71.2% in the same period of the prior year.  The increase in cost of
operations,  as a  percentage  of revenue,  was  primarily  due to lower  margin
revenue which was principally  from larger,  higher volume merchants who command
and deserve lower transactional pricing. This lower margin revenue was primarily
from the  cross-selling  of settlement  processing to several  higher volume EPS
merchants and from bringing our off-line debit product  in-house.  The new lower
margin revenue was partially  offset by other  operating  costs such as payroll,
depreciation and amortization and other certain operating costs, decreasing as a
percentage of revenue.

Selling, general and administrative expenses decreased from $13.1 million in the
second  quarter  of 1999 to $12.3  million  in 2000.  These  expenses  were down
slightly  as higher  salaries  and wages  were  offset by lower  legal and other
expenses. As a result, selling, general and administrative expenses were 4.2% of
revenue in the second quarter of 2000 versus 6.4% in the second quarter of 1999,
a decrease of 2.2% as a percentage of revenue.

Net interest  income  improved as a percentage  of total  revenue to 2.7% in the
second  quarter of 2000 compared to 0.9% in the same period of the prior year. A
principal  source of additional  interest  income each year is the investment of
available  cash flow from  operations  in securities  available  for sale.  Also
approximately  $61.7 million from the June 1999 offering of the Company's common
stock was  invested in  securities  available  for sale.  Increased  transaction
settlement volumes contributed to interest earned from overnight and short-term





                                      -14-
<PAGE>
                       CONCORD EFS, INC. AND SUBSIDIARIES
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
          OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued


Results of Operations - continued

investments.  These  factors  increased  interest  income by 85.8% in the second
quarter  of 2000  over  the  same  period  of the  prior  year.  Total  long and
short-term  debt was reduced  approximately  $146  million in June 1999 from the
proceeds of the June 1999 common stock offering.  As a result,  interest expense
decreased  38.1% in the second quarter of 2000 over the same period of the prior
year.  The  combination  of these  factors  increased  net interest  income as a
percentage of revenue.

In the six month period ended June 30, 2000,  revenue  increased 43.6% to $547.9
million from $381.6  million in 1999. Of 2000 revenue,  Merchant  Services,  ATM
Services and Other Services accounted for 71.7%, 27.3% and 1.0%, respectively of
revenue. Revenue from merchant card services,  increased 49.3%, due primarily to
increased  transactional  volumes.  Increased  volumes  resulted from adding new
merchants,   increasing   acceptance  of   electronic   payment  cards  and  the
cross-selling of settlement  processing to several EPS higher volume  merchants.
ATM  Services  revenue  increased  37.0%.  Increased  transactional  volumes and
in-house  processing of the EPS off-line debit product were the primary  factors
for the increase. Other revenues decreased 40.0% due primarily to lower terminal
sales.

Net income as a  percentage  of revenue was 15.3% for the six month period ended
June 30, 2000 compared to 7.7% in 1999. The margin improvement was the result of
a combination of factors.  The primary factor in the change was the  acquisition
expenses  and  restructuring  charges  incurred in the first  quarter of 1999 in
connection  with the acquisition of EPS.  Further  impacting this comparison was
related to certain nondeductible acquisition costs and a tax component write-off
of $1.3 million for impaired  state tax net operating  losses.  These items were
incurred in the first  quarter of 1999 and were  related to the  acquisition  of
EPS.  Excluding the pre-tax  charges and tax component  write-off,  the tax rate
decreased to 35.4% in the six month period ended June 30, 2000 compared to 35.8%
in the same period for the prior year.

Acquisition  expenses  and  restructuring  charges were $0.8 million for the six
month period ended June 30, 2000 compared to $34.8 million in the same period of
the prior year.  The current year expenses were  primarily  advisory,  legal and
accounting  fees  incurred  in the  acquisition  of CPS.  As of June  30,  2000,
approximately  $0.1  million of these  expenses  were  accrued but  unpaid.  The
acquisition  and  restructuring  charges  for the first  quarter  of 1999 were a
result of the  Company's  merger with EPS. As  explained in detail in the annual
report  section of the Company's Form 10-K for the year ended December 31, 1999,
the pre-tax  expenses and charges were for acquisition  expenses,  communication
conversion costs, asset write-offs,  off-line debit conversion and severance and
other.






                                      -15-
<PAGE>
                       CONCORD EFS, INC. AND SUBSIDIARIES
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
          OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued


Results of Operations - continued

The following table brings forward from December 31, 1999 the remaining  reserve
balance, in millions, from the EPS acquisition expenses and charges:

                               Balance at             Balance at
                     Cash or  December 31              June 30
    Description     Non-cash     1999      Activity      2000
------------------  --------  -----------  --------  -----------
Communication
  conversion costs    Cash       $11.3       $6.5        $4.8

Severance and
  other               Cash         1.4        1.1         0.3
                                 -----       ----        ----
                                 $12.7       $7.6        $5.1
                                 =====       ====        ====

Excluding  the pre-tax  charges  and tax  component  write-off,  net income as a
percentage of revenue  improved to 15.4% for the six month period ended June 30,
2000 compared to 14.8% in the same period of the prior year. Improvements,  as a
percentage  of  revenue,  were  made  in  selling,  general  and  administrative
expenses,  net interest income and income taxes.  These improvements were offset
by an increase in the cost of operations as a percentage of revenue.

Cost of  operations  increased  in the six month  period  ended June 30, 2000 to
74.4% of revenue  compared to 71.1% in the same  period of the prior  year.  The
increase in cost of operations, as a percentage of revenue, was primarily due to
lower margin revenue which was principally from larger,  higher volume merchants
who command and deserve lower transactional  pricing.  This lower margin revenue
was primarily from the cross-selling of settlement  processing to several higher
volume EPS merchants and from bringing our off-line debit product in-house.  The
new lower margin revenue was partially  offset by other  operating costs such as
payroll,  depreciation  and  amortization  and other  certain  operating  costs,
decreasing as a percentage of revenue.

Selling, general and administrative expenses decreased from $25.9 million in the
six  months  ended  June 30,  1999 to $24.8  million  in the same  period of the
current year.  These  expenses  were down slightly as higher  salaries and wages
were offset by lower legal and other expenses. As a result, selling, general and
administrative  expenses  were 4.5% of revenue in the six months  ended June 30,
2000 versus  6.8% in the same period of the prior year,  a decrease of 2.3% as a
percentage of revenue.








                                      -16-
<PAGE>
                       CONCORD EFS, INC. AND SUBSIDIARIES
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
          OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Continued


Results of Operations - continued

Net interest income improved as a percentage of total revenue to 2.7% in the six
month  period  ended June 30,  2000  compared  to 0.9% in the same period of the
prior year. A principal  source of additional  interest  income each year is the
investment of available  cash flow from  operations in securities  available for
sale.  Also  approximately  $61.7  million  from the June 1999  offering  of the
Company's common stock was invested in securities  available for sale. Increased
transaction settlement volumes contributed to interest earned from overnight and
short-term investments.  These factors increased interest income by 79.9% in the
six month  period  ended June 30,  2000 over the same  period of the prior year.
Total long and short-term  debt was reduced  approximately  $146 million in June
1999 from the  proceeds of the June 1999  common  stock  offering.  As a result,
interest  expense  decreased  39.8% in the six month  period ended June 30, 2000
over the same  period  of the  prior  year.  The  combination  of these  factors
increased net interest income as a percentage of revenue.

Liquidity and Capital Resources

In the six months ended June 30, 2000, the Company generated  cashflow of $117.4
million from  operating  activities.  The Company also received $19.0 million in
proceeds from Federal Home Loan Bank (FHLB) advances and $3.2 million from stock
issued for exercises of options under the Company's stock option plan.  Deposits
increased  $14.6  million.  From cash  provided  from  operating  and  financing
activities,  $52.4  million  was  invested  in  securities,  net  of  sales  and
maturities,   $37.7  million  was  invested   through  the   Company's   banking
subsidiaries in loans, net of repayments, $33.5 million was disbursed on capital
additions, and $12.6 million was spent to purchase merchant contracts. Long-term
debt was reduced by $19.0  million.  The capital  additions  were  primarily for
communications  equipment,  point-of-sale  terminals, new computer equipment and
capitalized software.

The Company  believes that available  credit and cash generated from  operations
are adequate to meet the  Company's  capital  needs.  EFS National  Bank and EFS
Federal Savings Bank,  wholly-owned  subsidiaries of the Company, exceed capital
ratios required by their respective regulatory agencies.

Quantitative and Qualitative Disclosures About Market Risk

There have been no significant  changes to our disclosures on  quantitative  and
qualitative   disclosures  about  market  risk  since  December  31,  1999.  For
additional  information,  refer to Exhibit 13 - Annual Report to Stockholders in
our Form 10-K for the year ended December 31, 1999.








                                      -17-
<PAGE>
                       CONCORD EFS, INC. AND SUBSIDIARIES

                                     PART II

                                OTHER INFORMATION

Item 2:  Changes in Securities and Use of Proceeds

Previous  owners of EPS and VCS had  received  unregistered  common stock of the
Company in  connection  with their  respective  acquisitions  in reliance on the
exemption  under  Section 4(2) the  Securities  Act of 1933  registered  665,275
shares  of  common  stock in a  registration  statement  filed  May 15,  2000 in
accordance with the  requirements of the Securities Act of 1933. The Company did
not receive any  proceeds  from the  subsequent  sale of shares by the  previous
owners of EPS or VCS.

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

(a)  Exhibits

     Exhibit 27 - Financial Data Schedule

(b)  Reports on Form 8-K

     No reports  were filed on Form 8-K for the six month period ended June 30,
     2000.






























                                      -18-
<PAGE>
                                   SIGNATURES



Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.



                                 CONCORD EFS, INC.



Date: August 11, 2000     By:  /s/ Dan M. Palmer
                               ---------------------------
                               Dan M. Palmer
                               Chairman of the Board and
                               Chief Executive Officer



Date: August 11, 2000     By:  /s/ Edward T. Haslam
                               ---------------------------
                               Edward T. Haslam
                               Chief Financial Officer






























                                      -19-