CERTAIN MATERIAL  (INDICATED BY AN ASTERICK) HAS BEEN OMITTED FROM THIS DOCUMENT
PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT.  THE OMITTED MATERIAL HAS BEEN
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.


                                Amendment Letter

                                          IBM Corporation  c/o Jennifer Lay
                                          325 J.S. McDonnell Blvd.  MC: S3066270
                                          Hazelwood, Missouri  63042


Thursday January 29, 2004


Direct Insite Corporation
80 Orville Drive
Bohemia, NY 11716


ATTENTION:   Anthony Coppola

SUBJECT:     Contract Extension

REFERENCE:   Agreement # 4901PM0001  SOW # 4903S40148


This letter serves as Amendment No. 1 to the above referenced  Statement of Work
which the parties thereto do mutually agree to amend as follows:

2.0.   Terms and Conditions:
---------------------------

The SOW will  remain in effect for the time  period  from  January 1, 2004,  and
until  December  31, 2005.  This SOW shall  automatically  renew for  successive
12-month  terms unless  terminated in writing by either party,  ninety (90) days
prior to the renewal date.

3.0   Scope:
-----------

Modifications to enhance the Target Applications in support of the United States
Invoicing  Project  shall be  based  on  specifications  defined  in the  Design
Document  entitled:  "CPI2.2  Design"  dated  December  10,  2003"  and shall be
included  in  the  collective  Target  Applications  for  on-going   operational
outsourcing Services when deployed. Terms and conditions defined in Statement of
Work # 4903S40148 and herein are applicable to the enhanced Target  Applications
and related  Services.  The Target  Applications  containing  such  function are
targeted for releases in May and October 2004 respectively.

4.0.   Payments and Fees:
------------------------

Buyer and Supplier have agreed to modify the calculation of Payment and Fee's as
follows:

     4.1. The "Minimum Monthly Processing Fee" shall be reduced from (*) for the
          time period of January 1, 2004  through  and  including  December  31,
          2005.  The monthly fee paid to the Supplier for the Services  shall be
          the greater of the "Minimum  Monthly  Processing  Fee" or the "Monthly
          Processing Fee" as determined in paragraph 4.2.

     4.2. The "Monthly  Processing  Fee" for "Unchanged  Preliminary  Bills" and
          "Preliminary Bill Changes" shall be the following:

          4.2.1 Unchanged  Preliminary  Bill Load and Processing Fee:  Unchanged
               Preliminary  Bills are  defined  as  Preliminary  Bills  that are
               processed  and loaded  into the  Supplier's  Target  Application,
               which  may be  viewed  or  printed  by the  Buyer or the  Buyer's
               Customer but not  "Changed" by the Buyer or the Buyers'  Customer
               during  the month  processed.  A Change is  defined  as placing a
               Preliminary  Bill or any line item  thereof  "On Hold" or "Issue"
               set  against  a  Preliminary  Bill or any line item  thereof,  or
               adding text, or including an attachment  manually or systemically
               using the Target  Application.  The  Unchanged  Preliminary  Bill
               Processing Fee is (*) per  Preliminary  Bill for the first twelve
               thousand (12,000)  Preliminary Bills and shall decrease by (*) %)
               for each increment of three thousand (3,000) additional Unchanged
               Preliminary Bills processed.

          4.2.2 Change  Fee:  A  Preliminary  Bill that is Changed as defined in
               Paragraph  4.2.1  shall  be  subject  to an  additional  fee  per
<PAGE>
                                Amendment Letter

               Preliminary  Bill of (*) for the first twelve  thousand  (12,000)
               Preliminary Bills and shall decrease by (*) %) for each increment
               of three thousand (3,000)  additional  Changed  Preliminary Bills
               processed.  There are no limits on the number of Changes that can
               be made to a Preliminary  Bill during the processing  month.  The
               Change  Fee is  applied  only  once per  month  where a Change is
               incurred  regardless of the number of Changes to the  Preliminary
               Bill during the month.  The  aforementioned  pricing includes the
               ability to manually or systematically  attach up to and including
               five attachments per Preliminary Bill for no additional charge.

               (For example:  The first  Preliminary  Bill that in processed and
               loaded into the Target  Application is subject to a fee of (*) as
               defined in paragraph  4.2.1. If that same Bill is "Changed",  the
               same Preliminary  Bill is subject to an additional  Change Fee of
               (*) for a total of (*).)

     4.3  The  Preliminary  Bill may be Changed as defined in Paragraph 4.2.1 at
          anytime during the processing  month. The scope of the Change includes
          the ability to manually or systemically  attach up to five attachments
          per single Preliminary Bill at no additional charge.

5.0   Data Processing.

The Service Level  Agreement  (SLA)  associated  with Data  Processing is hereby
modified  from  including  a maximum  number of  Preliminary  Bills to a maximum
number of Preliminary  Bills and attachments for a single  Preliminary  Bill for
the specified  processing  periods.  The remaining SLA and Data Processing terms
and conditions not described herein will continue to apply as defined in the SOW
referenced above. The modification to include number of attachments that will be
processed by a single  Preliminary Bill within the defined  processing period is
defined in the following table:
<TABLE>
<CAPTION>
------------------------------- ---------------------------- ---------------------------- ----------------------------
Monday - Thursday, "1X" or      Number of Preliminary Bills  Attachments for a Single     Availability of
"2X"                                                         Preliminary Bill             Preliminary Bills
------------------------------- ---------------------------- ---------------------------- ----------------------------
<S>                             <C>                          <C>                          <C>
                                4000                         0-100                        7:30AM EST
------------------------------- ---------------------------- ---------------------------- ----------------------------
                                8000                         101 -200                     9:00 AM EST
------------------------------- ---------------------------- ---------------------------- ----------------------------
                                Greater than 8000            201 and Greater              Best efforts within 48
                                                                                          continuous hours
------------------------------- ---------------------------- ---------------------------- ----------------------------
Friday                          Number of Preliminary Bills  Attachments for a Single     Availability of
                                                             Preliminary Bill             Preliminary Bills
------------------------------- ---------------------------- ---------------------------- ----------------------------
                                8000                         0-200                        7:00AM EST The Following
                                                                                          Monday
------------------------------- ---------------------------- ---------------------------- ----------------------------
                                Greater than 8000            201 and Greater              Best efforts within 24
                                                                                          continuous hours following
                                                                                          the 7:00AM Monday
                                                                                          Deliverable
------------------------------- ---------------------------- ---------------------------- ----------------------------
"3X"                            Number of Preliminary Bills  Attachments for a Single     Availability of
                                                             Preliminary Bill             Preliminary Bills
------------------------------- ---------------------------- ---------------------------- ----------------------------
                                8000                         0-200                        Six continuous hours from
                                                                                          receipt of the data files
                                                                                          from Buyer
------------------------------- ---------------------------- ---------------------------- ----------------------------
                                Greater than 8000            201 and Greater              Best efforts within 24
                                                                                          continuous hours from
                                                                                          receipt of the data files
                                                                                          from Buyer
------------------------------- ---------------------------- ---------------------------- ----------------------------
</TABLE>
     5.1  The  SLA's  for Data  Processing  is  modified  to be in  effect  upon
          execution  of this SOW  Amendment  for the first 0 - 2999  Preliminary
          Bills and 0 - 5,999

<PAGE>
                                Amendment Letter

Attachments  respectively and establish a maximum  threshold level. The SLA will
be in effect for up to  fifteen  percent  (15%)  above the  highest  established
maximum  threshold  level.  The maximum  threshold  level will  continue to grow
progressively  once a new  maximum  threshold  level  of  Preliminary  Bills  or
Attachments processed is attained.

A new maximum  threshold  level will be  established  for  Preliminary  Bills or
Attachments  once  the  Supplier  successfully  processes  Preliminary  Bills or
Attachments  within  fifteen  percent  (15%)  above the last  maximum  threshold
attained.  The  SLA  will  not be in  effect  until  the  Supplier  successfully
processes  the  next  highest   maximum   threshold  of  Preliminary   Bills  or
Attachments.  If the Supplier is unable to successfully process the next highest
maximum  threshold of Preliminary  Bills or  Attachments  the Supplier will have
thirty  days to make  corrections  and the SLA will be in  effect  for that next
highest maximum  threshold of Preliminary  Bills or Attachments after the thirty
day corrective period.

The  achievement  for  application  of the SLA related to the maximum  threshold
amounts attained for Preliminary  Bills and Attachments are mutually  exclusive.
Successfully  processing  above  the  maximum  threshold  amount is  defined  as
completing processing and posting results according to the time frames specified
in the terms and conditions for Data Processing in the SOW as amended.

For example,


Month One
2,999 Preliminary Bills submitted to Supplier for processing.
SLA is in effect
200 Attachments submitted to Supplier for processing.
SLA is in effect


Month Two
3,500 Preliminary Bills submitted to Supplier for processing.
SLA is in not effect
Supplier  successfully  processes 3,500 Preliminary Bills, SLA will be in effect
when Buyer  submits up to the new  maximum  threshold  of (3,500  *1.15 = 4,025)
Preliminary Bills

200 Attachments submitted to Supplier for processing.
SLA is in effect

Month Three
3,700 Preliminary Bills submitted to Supplier for processing.
SLA is in effect
5,000 Attachments submitted to Supplier for processing.
SLA is in not effect
Supplier does not successfully processes 5,000 Attachments

Month Four
3,900 Preliminary Bills submitted to Supplier for processing.
SLA is in effect
5,200  Attachments  submitted  to Supplier for  processing.  (Does not matter if
Supplier  processes  successfully  or not,  SLA is in  effect  and  new  maximum
threshold of (5,000 *1.15 = 5,750)  Attachments is established  for this month's
processing
SLA is in effect

     5.2  The maximum number of attachments for any one Preliminary Bill is four
          hundred (400).  Distributions of the attachments are as follows: fifty
          (50)  attachments at an average bytes count of five hundred and twelve
          (512) Kbytes per attachment and the remaining  three hundred and fifty
          (350)  attachments  at an  average  byte  count  of one  Kilobyte  per
          attachment.

     5.3  The maximum  number of  attachments  processed  under the SLA is sixty
          thousand (60,000) unique attachments per month.

     5.4  The  maximum  number of  attachments  processed  in one  single  daily
          processing  cycle will be fifteen thousand  (15,000)  attachments with
          average byte count of three hundred and  eighty-four  (384)  kilobytes
          per attachment.


Agreed To:                                                       Agreed To:
<PAGE>
                                Amendment Letter



Direct Insite Corporation                 IBM Corporation

By:        ____________________________   By: __________________________________
               Authorized Signature                 Authorized Signature

Name:      ____________________________   Name: ____Jennifer Lay________________
                  Type or Print                                 Type or Print

Date:      ____________________________   Date: ________________________________