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                                                                    Exhibit 20.2

[LML LETTERHEAD]

                                                                    news release

                 GARRETT'S IGA GROCERY STORE CHAIN SELECTS LML

                  Supermarket Chain Signs with LML to Process
 Checks, Credit, Debit and EBT Card Transactions for its Seven Store Locations

Vancouver, BC, May 3, 2001 - LML Payment Systems Inc. (the "Corporation")
(Nasdaq: LMLP) is pleased to announce its subsidiary LML Payment Systems Corp.
("LML") has signed an electronic transaction processing contract with Garrett's
IGA Supermarkets of Rio Rico, Arizona.

Garrett's IGA Supermarkets operates grocery stores in the Tucson and southern
Arizona areas. The transaction processing agreement involves the processing of
check authorizations, credit, debit and EBT card transactions through LML's
proprietary transaction software REPS (Retail Electronic Payments System). All
check transactions will be authorized against LML's national database of
checkwriters and subjected to a variety of positive velocity parameters on a
national, regional or store basis. The Automatic Risk Leveling (ARL) feature of
REPS allows clients to select the risk level for each region, store and/or each
cash register while monitoring transactions in real-time allowing for on-the-fly
risk level adjustments. Credit, debit and EBT card transactions will be routed
to third party processors for settlement.

As demonstrated live at the National Automated Clearing House Association's
Payments 2001 conference held in Washington, DC last week, REPS is an on-line,
real-time transaction processing software system running on LML's mainframe
computers housed at LML's primary data center in Phoenix, Arizona. REPS provides
retailers with the ability to view, monitor and administer all electronic
processing transactions (check, credit, debit and EBT) on a cash register, store
or chain basis in a real-time on-line environment.

"We are pleased with this contract," said Corporation President and CEO, Patrick
H. Gaines. "REPS provides retailers with information in a form never before
available. As a retail payment management tool, we believe REPS is
unprecedented. Called a "system by retailers for retailers", REPS forms the
basis upon which we plan to offer our whole suite of payment services products
to retailers, thus satisfying client needs in an ever increasing depth."

The Corporation, through its subsidiary LML Payment Systems Corp., is a
financial payment processor providing end-to-end check processing solutions
including electronic check verification, electronic check re-presentment
(whereby returned paper checks are re-presented for payment electronically),
Electronic Check Conversion (whereby paper checks are converted into electronic
transactions) and primary and secondary check collection to supermarkets,
grocery stores, multilane retailers, convenience stores and other national,
regional and local retailers. We also specialize in providing selective routing,
including real-time monitoring of check, debit, credit and EBT transactions for
authorization and settlement through our flagship transaction processing product
REPS (Retail Electronic Payment System). The Corporation's intellectual property
estate, owned by subsidiary LML Patent Corp, includes new U.S. Patent No.
6,164,528 regarding Internet checking transactions, in addition to U.S. Patent
No. 5,484,988 which describes a "Checkwriting point of sale system." which,
through a centralized database and authorization system, is capable of providing
and administering various electronic payment services for customers and
businesses. Also included in our intellectual property estate is a recently
received Notice of Allowance from the United States Patent and Trademark Office
for a new patent based upon United States Patent Application Serial No.
09/562,303. The new patent describes corporate checks and electronic fund
transfers (EFT) and relates to existing U.S. Patent No. 6,164,528 and U.S.
Patent No. 5,484,988 (described above).

Statements contained in this news release which are not historical facts are
forward-looking statements, subject to uncertainties and risks. For a discussion
of the risks associated with the Corporation's business, please see the
documents filed by the Corporation with the SEC.

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