The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes included elsewhere in this report. References in this section to "International Card Establishment, Inc.," the "Company," "we," "us," and "our" refer to International Card Establishment, Inc. and our direct and indirect subsidiaries on a consolidated basis unless the context indicates otherwise.

This interim report contains forward looking statements relating to our Company's future economic performance, plans and objectives of management for future operations, projections of revenue mix and other financial items that are based on the beliefs of, as well as assumptions made by and information currently known to, our management. The words "expects, intends, believes, anticipates, may, could, should" and similar expressions and variations thereof are intended to identify forward-looking statements. The cautionary statements set forth in this section are intended to emphasize that actual results may differ materially from those contained in any forward looking statement.

EXECUTIVE SUMMARY

Our strategy is to grow profitably by increasing our penetration of the expanding small merchant marketplace for payment, Gift & Loyalty and "microticket" leasing services. We find these merchants through our ISO and agent channels of distribution and intend to make additional acquisitions on an opportunistic basis in this fragmented segment of the industry.

OVERVIEW

We are a rapidly growing provider of credit and debit card-based payment processing services, Gift & Loyalty products and micro ticket leasing services to small merchants. As of March 31, 2006, we provided our services to numerous ISOs and thousands of merchants located across the United States. Our payment processing services enable our merchants to process traditional card-present, or swipe transactions, as well as card-not-present transactions. A traditional card-present transaction occurs whenever a cardholder physically presents a credit or debit card to a merchant at the point-of-sale. Card-not-present transactions occur whenever the customer does not physically present a payment card at the point-of-sale and may occur over the Internet or by mail, fax or telephone. Our microticket leasing services allow small merchants to finance the cost of POS equipment capable of reading a cardholder's account information from the card's magnetic stripe or computer chip and sending that information electronically for authorization and processing.

For additional detailed discussion regarding the Company's business and business trends affecting the Company and certain risks inherent in the Company's business, see "Item 6: Management's Discussion and Analysis or Plan of Operations" in the Company's Annual Report on Form 10-KSB for the year ended December 31, 2005.

DEVELOPMENT OF OUR BUSINESS

International Card Establishment, Inc. (the "Company") (formerly Summit World Ventures, Inc.) was incorporated on December 18, 1986 under the laws of the State of Delaware to engage in any lawful corporate activity, including, but not limited to, selected mergers and acquisitions. Prior to July 28, 2000, we were in the developmental stage and could be defined as a "shell" company, whose sole purpose was to locate and consummate a merger or acquisition with a private entity, and we did not have any operations. On July 28, 2000, we acquired iNetEvents, Inc., a Nevada corporation and commenced operations. iNetEvents, Inc., a Nevada corporation, was incorporated on February 3, 1999 and provided Internet support and supply software for real time event/convention information management.

On January 16, 2003, we entered into a Plan and Agreement of Reorganization with International Card Establishment, Inc., a Nevada corporation and its shareholders. International Card Establishment, Inc., a Nevada corporation, was incorporated on July 26, 2002. As part of the acquisition - a reorganization in the form of a reverse merger, International Card Establishment, Inc. became our wholly-owned subsidiary, and there was a change of our control. Following the International Card Establishment, Inc. acquisition we changed our corporate name from iNetEvents, Inc. to International Card Establishment, Inc. and reverse split our outstanding shares of Common Stock on a one for two share basis.

On December 15, 2003 we entered into a Plan and Agreement of Reorganization with GlobalTech Leasing, Inc., a California corporation and its shareholders. On December 29, 2003 GlobalTech Leasing, Inc. became our wholly-owned subsidiary.

Effective September 8, 2004, we entered into a Plan and Agreement of Reorganization with Neos Merchant Solutions, Inc., a Nevada corporation and its shareholders. Effective September 8, 2004, Neos Merchant Solutions, Inc. became our wholly owned subsidiary.

Our business operations are now conducted primarily through three wholly-owned subsidiaries: International Card Establishment, Inc., a Nevada corporation ("ICE"), GlobalTech Leasing, Inc., a California corporation ("GTL"), and NEOS Merchant Solutions, Inc, a Nevada corporation ("NEOS"). iNetEvents, Inc., a Nevada corporation ("iNet"), will also be maintained as a separate subsidiary to service and maintain existing, historic iNet business. ICE is a provider of credit and debit card-based payment processing services for small merchants, that enable those merchants to accept credit cards, debit cards, and other forms of electronic payments from their customers; supplies the necessary card readers and other point-of-sale authorization systems ("POS equipment"), which are often financed by GTL; and, provides merchant e-commerce solutions. GTL is a growing provider of lease financing services for POS equipment in amounts generally ranging from $400 to $5,000, with an average amount financed of approximately $1,600 and an average lease term of 48 months. NEOS offers merchants a "Smart Card" (a card that stores data digitally on an embedded chip and not on an analog magnetic stripe) based system that enables merchants to provide its proprietary gift cards and incentive-purchase cards that are custom merchant branded.

CRITICAL ACCOUNTING POLICIES

REVENUES
The Company provides merchant services and customer support for merchants and other Merchant Services providers. Revenues are recognized as customer services are provided.

The Company provides merchant services to customers for acceptance and processing of electronic payments, and the sales and leasing of related equipment used for the processing of electronic payments. Credit card processing fees are recognized as incurred. Sales and cost of sales of equipment are recognized when the equipment is provided and the customer accepts responsibility for the payment of the equipment. Lease income is recognized on a monthly basis as incurred. For leasing of merchant processing equipment, an allowance of 25% of the current month's leases is recorded. Each month, the allowance is reconciled against collections, recording actual losses to sales allowances.

The Company, through its subsidiary GTL acquires leases from Independent Sales Organizations (ISO). GTL packages and resells the leases to financing institutions for administration of the leases. Revenue is recognized upon approval of the sales agreement and shipment of equipment by the ISO. Leases not accepted by the financing institutions are recovered from the ISO, or may be processed in house.

We do not have any of the following:

* Off-balance sheet arrangements.

* Certain trading activities that include non-exchange traded contracts accounted for at fair value.

* Relationships and transactions with persons or entities that derive benefits from any non-independent relationships other than related party transactions discussed herein.

RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2006 ("2006")
COMPARED TO THE THREE MONTHS ENDED MARCH 31, 2005 ("2005")

Results of operations consist of the following:


                               March 31, 2006     March 31, 2005      $ Change      % Change

     Net Revenues                $2,478,894        $1,427,080        $1,051,814        74%

     Cost of Revenues             1,694,115           667,400         1,026,715       154%
                                 ___________________________________________________________
     Gross Profit                   784,779           759,680            25,099         3%

     Operating, General and       1,370,770         1,682,326          (311,556)      (19%)
     Administrative Costs        ___________________________________________________________

     Net Operating Loss          $ (585,991)       $ (922,646)       $  336,655       (36%)

The 74% increase in net revenues between March 31, 2005 and March 31, 2006 is mainly attributable to an increase of $1,502,676 in Merchant Services Revenue, offset by a decrease in lease transactions.

The increase in cost of revenues is directly related to the increase in merchant account services and the recording of interchange expense due to the increased volume. Commissions and other cost of leases remained relatively constant between the two periods.

General and administrative costs decreased by approximately $310,000 largely due to approximately $50,000 decreases in each of the following areas - rent, advertising, office supplies and postage, contract labor and depreciation. Professional fees also decreased by $77,000. These reductions in expenses were largely due to costing cutting measures by management and were offset by an increase in interest expense and merchant losses.

RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2006 ("2006")
COMPARED TO THE THREE MONTHS ENDED MARCH 31, 2005 ("2005") BY SEGMENT (selected
financial information is below)

MERCHANT SERVICES

                                                31-Mar-06             31-Mar-05             $ Change              % Change
                                            Merchant Services     Merchant Services     Merchant Services     Merchant Services

 Merchant service revenues                     $ 2,325,171           $ 1,093,192           $ 1,231,979               113%

 Less:  sales returns and allowances                (5,735)              (27,699)               21,964                21%
                                               __________________________________________________________________________
 Net revenue                                     2,319,436             1,065,493             1,253,943               218%

 Cost of revenue                                 1,688,508               658,094             1,030,414               257%
                                               __________________________________________________________________________
 Gross margin                                  $   630,928           $   407,398           $   223,529               155%

 Operating, general, and administrative        $   902,259           $ 1,205,885           $  (303,626)               75%
 expenses

 Net loss before income taxes                  $  (524,636)          $(1,089,924)          $   565,288                48%


                                       14




As of March 31, 2006 the Company has increased processing volume of credit cards
by 62% in comparison to same period in the prior year, resulting in an increase
of 113% in gross revenue (218% net revenue). Due to the increase in new
accounts, the Cost of Revenue increased because of additional Residuals expense
incurred and the recognition of Interchange Fees, Dues and Assessments as a
whole sale provider, resulting in an increase of 257%.

Operating, general and administrative expenses decreased due to the elimination
of unprofitable offices, resulting in cost savings of 75% in comparison to the
same period last year.

The combination of increased processing volume and cost reductions decreased our
overall net loss for this segment by 50%.

LEASING SERVICES

                                               31-Mar-06              31-Mar-05              $ Change              % Change
                                            Leasing Services       Leasing Services      Leasing Services      Leasing Services

 Gain on sale of leases                        $   167,621           $   640,448           $  (472,826)              (74%)
                                               __________________________________________________________________________
 Cost of revenue                                    13,770               288,165              (274,395)              (95%)
                                               __________________________________________________________________________
 Gross margin                                  $   153,851           $   352,282           $  (198,431)              (56%)

 Operating, general, and                       $   167,441           $   169,882           $    (2,440)               (1%)
 administrative expenses

 Net income (loss) before income               $   (14,166)          $   166,599           $  (180,765)              (109%)
 taxes

As of March 31, 2006 the Company offered customers alternatives to leasing which
guaranteed sales but decreased lease revenue as compared to same period in the
prior year. This resulted in a decrease of Gain on the sales of leases by 74% in
2006. Concurrently, the Company purchased a different line of equipment which
lowered Cost of Revenue, resulting in a decrease of Cost of Revenue by 95% in
2006.

Operating, general and administrative expenses remained relatively flat in
comparison to the same period last year.

Due to our lower Gain on the sale of leases for this business segment, we
incurred a nominal net loss as of March 31, 2006, versus a net income position
for the same period in 2005.

LIQUIDITY AND CAPITAL RESOURCES

We are currently seeking to expand our merchant services offerings in bankcard,
gift and loyalty and POS equipment leasing. In addition, we are investigating
additional business opportunities and potential acquisitions; accordingly we
will require additional capital to complete the expansion and to undertake any
additional business opportunities.

                                              March 31, 2006      December 31, 2005         $ Change              % Change

Cash                                           $   381,131           $   748,040           $  (366,909)              (49%)

Accounts Payable and                           $ 1,242,416           $ 1,265,606           $   (23,190)               (2%)
Accrued Expenses

Accounts Receivable and                        $   421,221           $   518,231           $   (97,010)              (19%)
Finance Lease Receivable

Proceeds from sale of                          $   180,000           $         -           $   180,000               100%
Common Stock Subscriptions

We have financed our operations during the quarter primarily through the receipt of proceeds from common stock and use of cash on hand. As of March 31, 2006, we had total current liabilities of $3,488,837 compared to $3,413,522 as of December 31, 2005. The increase in current liabilities is primarily due to an increase in Accrued Expenses and Current Notes payable. We had no long term liabilities during any of these periods.

Cash decreased 49% as of March 31, 2006 due to the acquisition costs incurred for the purchase of portfolios ($220,084, gross cash) and payment of Accounts Payable.

As of March 31, 2006, our accounts receivable and finance lease receivable accumulated to $421,220 compared to $518,230 at December 31, 2005.

The Company received $1,725,461 in net proceeds from the 2004 sale of its preferred stock during the quarter ended March 31, 2005. The Company did not have any preferred stock transactions in 2006. As of March 31, 2005, the Company did not have any common stock transactions resulting in proceeds; transactions as of March 31, 2006 resulted in common stock subscription proceeds of $180,000. The Company issued 929,242 common shares in 2005 compared zero common shares in 2006. Management believes that it will be able to fund the company through its present cash position and the continuation of revenue producing activities by its subsidiaries ICE, GTL, and NEOS. We will need to seek further capital through the sale of our capital stock and/or the issuance of debt in order to continue to grow the Company.

We had $381,131 cash on hand as of March 31, 2006 compared to $748,040 as of December 31, 2005. We will continue to need additional cash during the following twelve months and these needs will coincide with the cash demands resulting from our general operations and planned expansion. There is no assurance that we will be able to obtain additional capital as required, or obtain the capital on acceptable terms and conditions.