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It’s St. Patrick’s Day and we’re all green with excitement! The famous St. Patrick’s Day parades are back in full force, after being toned down during the worst of the Covid-19 pandemic, and Chicago has once again dyed its river green to celebrate the special day.

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Don’t forget to put on some green for good luck, drink a traditional Guinness for prosperity or order McDonald’s famous Shamrock Shake to enjoy, enjoy a plate of delicious Irish food and sit down and celebrate the patron saint of Ireland, whose festivities are commemorated around the world.

St. Patrick’s Day is akin to Ireland’s own Mardi Gras – pausing before Easter to pay homage to a saint who lived and died hundreds of years ago. Research shows that the beloved saint was a 5th-century missionary who converted pagans to Christianity and who used the shamrock, or three-leaf clover, to explain the Holy Trinity of the Catholic Church to converts.

There’s also that part of him chasing all the snakes off the island, even though the snakes weren’t native to the area. A little-known legend about the saint is that he raised the dead many times. Its impact on Ireland and the world at large is nothing short of profound, and that is why it is celebrated every March 17.

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The reality is that you don’t have to be Irish to enjoy this patron saint of the Emerald Isle. Wear something green, eat something Irish, raise a glass and be sure to say slainte. Happy St. Patrick’s Day!

FOOD:

Irish cuisine is legendary, steeped in centuries of tradition and history. If the opportunity allows you to visit this beautiful place, get your hands on their delicious butter and smother it on freshly baked soda bread.

“Irish culinary tradition has evolved since prehistoric times,” notes the Irish traditional cuisine cookbook (Kyle Cathie Ltd.). “Irish cuisine is…as complex as the many cultural, political and economic forces that have shaped Ireland’s existence.”

Traditional dishes include soda bread, Irish stew, smoked salmon, collar cannon (a delicious savory potato dish) and corned beef and cabbage. For dessert, you can’t go wrong with a Guinness-inspired chocolate cake.

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WHY GREEN BEER?

It’s tough, but green beer seems to be a St. Patrick’s Day staple – though many Irish beer purists are appalled at the very thought of drinking a green one. Research shows that green beer is not Irish at all and was first introduced in the early 1900s, at a special St. Patrick’s Day dinner hosted by a certain Dr Thomas Hayes Curtin from the Bronx . According to www.smithsonianmag.com, the good doctor used a somewhat toxic iron-based laundry dye called “wash blue” to tint the beer green. It was a great success, of course.

TOP ST. PATRICK’S DAY COCKTAILS:

According to Cocktail.com, the top five St. Patrick’s Day cocktails make up a surprising lineup this year, according to the company’s global bartending network. “The flavors of this Irish holiday may take a new direction,” company officials noted in a recent email statement – with these cocktails representing “a…break from the classic St. Patrick’s Day classics.” They understand:

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– Irish coffee: “Top of the list, as always. The creamy, lightly peated coffee drink has been a classic for almost as long as the holidays have existed.

– Irish Grasshopper: » It is a more dessert cocktail than Irish Coffee, which relies more on crème de liqueur and crème de cacao, a popular substitute for those who dislike coffee cocktails.

– Irish maid: “It’s a classic Irish cocktail, (but) resulting in similar green, fruity and refreshing drinks that still use Irish whiskey but move into that refreshing territory with elderberry liqueur and lemon juice.”

– Eye of the hurricane: “is the epitome of this trend. It is a mixture of white rum, bitter lemon and passion fruit.

– Shamrock hallmark: “is the fruitiest of all the St. Patrick’s Day drinks here. He’s also on the rise, but has a certain fan base. This is definitely another drink to watch out for.

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– To verify www.cocktail.com for more drink-inspired ideas!

NOT A SHAMROCK SHAKE

Everyone was looking for the perfect green cocktails to serve this St. Patrick’s Day. Here’s a wonderful recipe courtesy of mixologists Jameson Irish Wiskey. (www.jamesonwhiskey.com/en-CA)

3 tbsp. (45mL) Favorite Irish Whiskey

2 tbsp. lemon juice

2 tbsp. simple syrup (equal parts boiling water with sugar, cooled)

8 fresh basil leaves

2 1/2 tsp. (40ml) sparkling white wine

Lightly crush the basil leaves in your shaker. Add the rest of the ingredients except the sparkling wine and shake with ice. Double strain into a chilled tall glass filled with ice. Drizzle with sparkling white wine and garnish with a basil leaf.

HAGGERTY IRISH STOVE

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This rich and delicious dish is described as a great Irish comfort food. Popular as a main course or side dish. Courtesy recipe www.foodlandontario.ca. For 6 to 8 people.

5 slices bacon, diced

2 cups minced onion

2 large garlic cloves, minced

2 pounds. white potatoes, thinly sliced ​​(unpeeled)

Salt and pepper

1-1/2 cup grated aged cheddar cheese

1 1/4 cups (300 ml) chicken or vegetable broth

2 tbsp. (25 mL) finely sliced ​​fresh chives

In a 12-inch cast iron or ovenproof skillet over medium-high heat, cook the bacon until crisp. Remove to a medium bowl. Add onion to skillet; cook 8 minutes, stirring often. Stir in garlic; cook 2 minutes or until onions are very soft and caramelized. Stir into bacon.

Remove skillet from heat. Arrange a layer of potatoes in the bottom of the skillet. Top with half the bacon mixture; Season with salt and pepper. Add another layer of potatoes; sprinkle with 1/2 cup cheese. Add another layer of potatoes, the rest of the bacon mixture and season with salt and pepper. Add the last layer of potatoes. Pour the broth. Cover tightly with aluminum foil or a lid. Cook over medium-low heat for 20 minutes or until the potatoes are knife-tender.

Remove foil. Top with remaining cheese. Bake at 425F for 10-12 minutes, until cheese is bubbling and lightly browned. Sprinkle with chives. Serve in wedges.

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Although the country has several advantages, including natural beauty, rich culture and excellent cuisine, the industry has failed to develop branded tourism products, which may pose new challenges as Vietnam reopens the inbound tourism from March 15, they add.

“We cannot fully satisfy foreign tourists yet, although we are winning big prizes in luxury tourism, owning world-class resorts and leading global hotel brands,” said Pham Ha, chairman of the group. Lux, specializing in luxury cruise services.

“For many foreign tourists, Muay Thai, golden temples, traditional dances, language and cuisine come to mind when they think of Thailand,” Ha explained.

Vietnam has dozens of heritage sites recognized by UNESCO, more than 3,000 nationally recognized relics and 5,000 provincially.

In 2019-2020, Vietnam was honored as the “world’s leading heritage destination” by the World Travel Awards (WTA).

Ha said all this is proof that the country can position its tourism brand and develop heritage-related tourism products.

“For attracting spendthrift tourists after Covid, heritage tourism is extremely appropriate because of its ability to connect with high-end resorts, golf courses and health services,” he said.

Doan Manh Phuoc, director of tourism development consultancy Outbox Consulting, said tourism managers need to invest more in brand communication.

“Each country has its own characteristics, strengths and attractions for tourists. I think Vietnam should learn from other countries to promote its tourism brand to the international community,” he said.

“To be frank, Vietnam has never had a clear and strategic tourism brand like other countries in the region have,” Phuoc said.

He said the industry should focus on promoting the country’s image on international channels such as CNN and the BBC.

In addition to branded tourism products, experts and industry insiders have also proposed that the government consider abolishing visas for nationals of more countries as countries in the region have done.

Luong Hoai Nam, a member of the Tourism Advisory Council, said the government should scrap visas for visitors from the European Union, Australia and New Zealand.

For major tourist markets like China and the United States, the government should consider long-term visas of up to 10 years to attract more visitors, he added.

Before the pandemic, Vietnam did not require visas for travelers from 24 countries, compared to 61 for Thailand, 158 for Singapore, 155 for Malaysia and 169 for Indonesia.

Huynh Phan Phuong Hoang, deputy chief executive of major tour operator Vietravel, said what the government should do urgently is resume visa policies that worked before the pandemic. This was necessary to promote inbound tourism.

Several ministries have also proposed to the government to resume the visa waiver policy that was in place before the Covid-19 pandemic, but no final decision has been taken on this, although less than a month remains. week before the full resumption of international tourism.

You may remember it as “La Ruche”.

Three years ago last month, the Poughkeepsie project was officially announced as a mixed-use development that could not only bolster food infrastructure in a city that has food deserts, but also provide affordable housing.

Since then the name and exterior designs have changed. A beehive design motif on the walls has been replaced with a flower mural, reaching into a penthouse still under construction.

The COVID-19 pandemic has also taken its toll, forcing developers to redesign elements and causing shortages that have increased costs. The original plan for a 2020 opening is a distant memory.

But, the idea of ​​combining a food hall, fresh produce market, restaurant, event space and coworking space with housing has never changed.

Developers and officials say when the project, known as ‘The Academy’ since fall 2020, opens in a few months, it will mark another milestone in the ongoing revitalization of downtown Queen City. .

Forward-looking information

This Quarterly Report on Form 10-Q contains various forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933 and Section 21E
of the Securities Exchange Act of 1934. Such statements are based on
management's current beliefs and assumptions, as well as information currently
available to management. When used in this document, the words "anticipate",
"estimate", "expect", "will", "may", "plan," "believe", "intend" and similar
expressions are intended to identify forward-looking statements. Although
Nicholas Financial, Inc., including its subsidiaries (collectively, the
"Company," "we," "us," or "our") believes that the expectations reflected or
implied in such forward-looking statements are reasonable, it can give no
assurance that such expectations will prove to be correct. As a result, actual
results could differ materially from those indicated in these forward-looking
statements. Forward-looking statements in this Quarterly Report may include,
without limitation: (1) the projected impact of the novel coronavirus disease
("COVID-19") outbreak on our customers and our business, (2) projections of
revenue, income, and other items relating to our financial position and results
of operations, (3) statements of our plans, objectives, strategies, goals and
intentions, (4) statements regarding the capabilities, capacities, market
position and expected development of our business operations, and (5) statements
of expected industry and general economic trends. These statements are subject
to certain risks, uncertainties and assumptions that may cause results to differ
materially from those expressed or implied in forward-looking statements,
including without limitation:

•

the ongoing impact on us, our employees, our customers and the overall economy
of the COVID-19 pandemic and measures taken in response thereto, including
without limitation the successful delivery of vaccines effective against the
different variants of the virus, for which future developments are highly
uncertain and difficult to predict;
•
availability of capital (including the ability to access bank financing);
•
recently enacted, proposed or future legislation and the manner in which it is
implemented, including tax legislation initiatives or challenges to our tax
positions and/or interpretations, and state sales tax rules and regulations;
•
fluctuations in the economy;
•
the degree and nature of competition and its effects on the Company's financial
results;
•
fluctuations in interest rates;
•
effectiveness of our risk management processes and procedures, including the
effectiveness of the Company's internal control over financial reporting and
disclosure controls and procedures;
•
demand for consumer financing in the markets served by the Company;
•
our ability to successfully develop and commercialize new or enhanced products
and services;
•
the sufficiency of our allowance for credit losses and the accuracy of the
assumptions or estimates used in preparing our financial statements;
•
increases in the default rates experienced on automobile finance installment
contracts ("Contracts");
•
higher borrowing costs and adverse financial market conditions impacting our
funding and liquidity;
•
our ability to securitize our loan receivables, occurrence of an early
amortization of our securitization facilities, loss of the right to service or
subservice our securitized loan receivables, and lower payment rates on our
securitized loan receivables;
•
regulation, supervision, examination and enforcement of our business by
governmental authorities, and adverse regulatory changes in the Company's
existing and future markets, including the impact of the Dodd-Frank Wall Street
Reform and Consumer Protection Act (the "Dodd-Frank Act") and other legislative
and regulatory developments, including regulations relating to privacy,
information security and data protection and the impact of the Consumer
Financial Protection Bureau's (the "CFPB") regulation of our business;
•
fraudulent activity, employee misconduct or misconduct by third parties;
•
media and public characterization of consumer installment loans;
•
failure of third parties to provide various services that are important to our
operations;
•
alleged infringement of intellectual property rights of others and our ability
to protect our intellectual property;
•
litigation and regulatory actions;
•
our ability to attract, retain and motivate key officers and employees;

                                       15

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•

use of third-party vendors and ongoing third-party business relationships;
•
cyber-attacks or other security breaches;
•
disruptions in the operations of our computer systems and data centers;
•
the impact of changes in accounting rules and regulations, or their
interpretation or application, which could materially and adversely affect the
Company's reported consolidated financial statements or necessitate material
delays or changes in the issuance of the Company's audited consolidated
financial statements;
•
uncertainties associated with management turnover and the effective succession
of senior management;
•
our ability to realize our intentions regarding strategic alternatives,
including the failure to achieve anticipated synergies;
•
our ability to expand our business, including our ability to complete
acquisitions and integrate the operations of acquired businesses and to expand
into new markets; and
•
the risk factors discussed under "Item 1A - Risk Factors" in our Annual Report
on Form 10-K, and our other filings made with the U.S. Securities and Exchange
Commission ("SEC").

Should one or more of these risks or uncertainties materialize, or should
underlying assumptions prove incorrect, actual results may vary materially from
those anticipated, estimated or expected. All forward-looking statements
included in this Quarterly Report are based on information available to the
Company as the date of filing of this Quarterly Report, and the Company assumes
no obligation to update any such forward-looking statement. Prospective
investors should also consult the risk factors described from time to time in
the Company's other filings made with the SEC, including its reports on Forms
10-K, 10-Q, 8-K and annual reports to shareholders.

Disputes and legal issues

See “Item 1. Legal Proceedings” in Part II of this Quarterly Report below.

COVID-19[female[feminine

The temporary expansion of unemployment benefits by the CARES Act, the
Coronavirus Response and Relief Supplemental Appropriations Act of 2021 and the
American Rescue Plan Act of 2021 to eligible individuals collectively had a
beneficial effect on the Company; however, the impact of these benefits has
almost entirely disappeared, as our customers no longer qualify for such
benefits. The Company continued to experience strong cash collections and
experienced positive trending on gross charge-off balances for the three months
ended December 31, 2021.

In accordance with our policies and procedures, certain borrowers qualify for,
and the Company offers, one-month principal payment deferrals on Contracts and
Direct Loans. Due to COVID-19, the number of deferments increased to 3,114 in
April 2020 from 724 in March 2020. For the year ended March 31, 2021 the Company
experienced an average monthly number of deferments of 696, which would
represent approximately 2.6% of total Contracts and Direct Loans as of March 31,
2021. For the three months ended December 31, 2021, the average monthly number
of deferments was 297, which would represent approximately 1.14% of total
Contracts and Direct Loans as of December 31, 2021. For the nine months ended
December 31, 2021, the average monthly number of deferments was 232, which would
represent approximately 0.89% of total Contracts and Direct Loans as of December
31, 2021. The number of deferrals is also influenced by portfolio performance,
including but not limited to, inflation, credit quality of loans purchased,
competition at the time of Contract acquisition, and general economic
conditions.

The Company estimates that the number of one-month principal payment deferrals is now broadly in line with pre-pandemic levels.

However, the extent to which the COVID-19 pandemic eventually impacts our
business, financial condition, results of operations or cash flows will depend
on numerous evolving factors that we are unable to accurately predict at this
time. The length and scope of the restrictions imposed by various governments
and success of vaccination efforts among other factors, will determine the
ultimate severity of the COVID-19 impact on our business. It is likely that
prolonged periods of difficult market conditions could have material adverse
impacts on our business, financial condition, results of operations and cash
flows.

Regulatory Developments

On October 5, 2017, the CFPB issued a final rule (the "Rule") imposing
limitations on (i) short-term consumer loans, (ii) longer-term consumer
installment loans with balloon payments, and (iii) higher-rate consumer
installment loans repayable by a payment authorization. The Rule requires
lenders originating short-term loans and longer-term balloon payment loans to
evaluate whether each consumer has the ability to repay the loan along with
current obligations and expenses ("ability to repay requirements"). The Rule
also curtails repeated unsuccessful attempts to debit consumers' accounts for
short-term loans, balloon payment loans, and

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installment loans that involve a payment authorization and an Annual Percentage
Rate over 36% ("payment requirements"). The Company does not believe that it
will have a material impact on the Company's existing lending procedures,
because the Company currently does not make short-term consumer loans or
longer-term consumer installment loans with balloon payments that would subject
the Company to the Rule's ability to repay requirements. The Company also
currently underwrites all its loans (including those secured by a vehicle title
that would fall within the scope of these proposals) by reviewing the customer's
ability to repay based on the Company's standards. However, implementation of
the Rule's payment requirements may require changes to the Company's practices
and procedures for such loans, which could affect the Company's ability to make
such loans, the cost of making such loans, the Company's ability to, or
frequency with which it could, refinance any such loans, and the profitability
of such loans.

Further, on June 6, 2019, the CFPB amended the Rule to delay the August 19, 2019
compliance date for part of the Rule's provisions, including the ability to
repay requirements. In addition, on February 6, 2019, the CFPB issued a notice
of proposed rulemaking proposing to rescind provisions of the Rule governing the
ability to repay requirements. There were also lawsuits filed challenging
various provisions of these Rules, as well as the constitutionality of the
CFPB's structure, and the court stayed the compliance date of the Rule while the
litigation was pending. The Supreme Court handed down its decision on the
constitutional challenge in June 2020, and in July 2020, the CFPB issued a final
Rule, which revoked the underwriting provisions of the prior Rule. However,
additional lawsuits were filed challenging the payment provisions of the Rule
issued in 2020. In August 2021, the court found for the CFPB and dismissed the
remaining challenges. As a result, the compliance date for the payments
provisions of the Rule is now June 13, 2022 Unless rescinded or otherwise
amended, the Company will have to comply with the Rule's payment requirements if
it continues to allow consumers to set up future recurring payments online for
certain covered loans such that it meets the definition of having a "leveraged
payment mechanism" under the Rule. If the payment provisions of the Rule apply,
the Company will have to modify its loan payment procedures to comply with the
required notices and mandated timeframes set forth in the final rule.

The CFPB defines a "larger participant" of automobile financing if it has at
least 10,000 aggregate annual originations. The Company does not meet the
threshold of at least 10,000 aggregate annual direct loan originations, and
therefore would not fall under the CFPB's supervisory authority. The CFPB issued
rules regarding the supervision and examination of non-depository "larger
participants" in the automobile finance business. The CFPB's stated objectives
of such examinations are: to assess the quality of a larger participant's
compliance management systems for preventing violations of federal consumer
financial laws; to identify acts or practices that materially increase the risk
of violations of federal consumer finance laws and associated harm to consumers;
and to gather facts that help determine whether the larger participant engages
in acts or practices that are likely to violate federal consumer financial laws
in connection with its automobile finance business. At such time, if we become
or the CFPB defines us as a larger participant, we will be subject to
examination by the CFPB for, among other things, ECOA compliance; unfair,
deceptive or abusive acts or practices ("UDAAP") compliance; and the adequacy of
our compliance management systems.

We have continued to evaluate our existing compliance management systems. We
expect this process to continue as the CFPB promulgates new and evolving rules
and interpretations. Given the time and effort needed to establish, implement
and maintain adequate compliance management systems and the resources and costs
associated with being examined by the CFPB, such an examination could likely
have a material adverse effect on our business, financial condition and
profitability. Moreover, any such examination by the CFPB could result in the
assessment of penalties, including fines, and other remedies which could, in
turn, have a material effect on our business, financial condition, and
profitability.

Critical accounting estimate

A critical accounting estimate is an estimate that:

•

is made in accordance with generally accepted accounting principles
•
involves a significant level of estimation uncertainty, and
•
has had or is reasonably likely to have a material impact on the Company's
financial condition or results of operation

The Company's critical accounting estimate relates to the allowance for credit
losses. It is based on management's opinion of an amount that is adequate to
absorb losses incurred in the existing portfolio. Because of the nature of the
customers under the Company's Contracts and Direct Loan program, the Company
considers the establishment of adequate reserves for credit losses to be
imperative.

The Company uses trailing six-month net charge-offs as a percentage of average
finance receivables, annualized and applies this calculated percentage to ending
finance receivables to calculate estimated future probable credit losses for
purposes of determining the allowance for credit losses. The Company then takes
into consideration the composition of its portfolio, current economic
conditions, estimated net realizable value of the underlying collateral,
historical loan loss experience, delinquency, non-performing assets, and
bankrupt accounts and adjusts the above, if necessary, to determine management's
total estimate of probable credit losses

                                       17

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and its assessment of the overall adequacy of the allowance for credit losses.
Management utilizes significant judgment in determining probable incurred losses
and in identifying and evaluating qualitative factors. This approach aligns with
the Company's lending policies and underwriting standards.

If the allowance for credit losses is determined to be inadequate, then an
additional charge to the provision is recorded to maintain adequate reserves
based on management's evaluation of the risk inherent in the loan portfolio.
Conversely, the Company could identify abnormalities in the composition of the
portfolio, which would indicate the calculation is overstated and management
judgement may be required to determine the allowance of credit losses for both
Contracts and Direct Loans.

Contracts are purchased from many different dealers and are all purchased on an
individual Contract-by-Contract basis. Individual Contract pricing is determined
by the automobile dealerships and is generally the lesser of the applicable
state maximum interest rate, if any, or the maximum interest rate which the
customer will accept. In most markets, competitive forces will drive down
Contract rates from the maximum rate to a level where an individual competitor
is willing to buy an individual Contract. The Company generally purchases
Contracts on an individual basis.

The Company utilizes the branch model, which allows for Contract purchasing to
be done at the branch level. The Company has detailed underwriting guidelines it
utilizes to determine which Contracts to purchase. These guidelines are specific
and are designed to provide reasonable assurance that the Contracts that the
Company purchases have common risk characteristics. The Company utilizes its
District Managers to evaluate their respective branch locations for adherence to
these underwriting guidelines, as well as approve underwriting exceptions. The
Company also utilizes field auditors to assure adherence to its underwriting
guidelines. Any Contract that does not meet the Company's underwriting
guidelines can be submitted by a branch manager for approval from the Company's
District Managers or senior management.

introduction

For the three months ended December 31, 2021, the net dilutive loss per share
increased to $0.09 as compared to net dilutive earnings per share of $0.49 for
the three months ended December 31, 2020. Net loss was $0.7 million for the
three months ended December 31, 2021 as compared to a net income of $3.8 million
for the three months ended December 31, 2020. Revenue decreased 15.4% to $12.2
million for the three months ended December 31, 2021, as compared to $14.5
million for the three months ended December 31, 2020, due to realized and
unrealized gains of $1.3 million on equity investments in the prior year quarter
and a 6.6% decrease in finance receivables.

For the nine months ended December 31, 2021, the net dilutive earnings per share
increased to $0.34 as compared to net dilutive earnings per share of $0.85 for
the nine months ended December 31, 2020. Net income was $2.6 million inclusive
of $1.9 million
of interest expense related to the unamortized debt issuance costs on the
extinguishment of the prior credit facility for the nine months ended December
31, 2021 as compared to a net income of $6.5 million which included realized and
unrealized gains of $1.3 million on equity investments for the nine months ended
December 31, 2020. Total revenue decreased 12.5% to $37.4 million for the nine
months ended December 31, 2021 as compared to $42.7 million for the nine months
ended December 31, 2020, due to a 12.1% decrease in average finance receivables,
compared to the prior year period.

The Company finances primary transportation to and from work for the subprime
borrower. The Company does not finance luxury cars, second units or recreational
vehicles, which are the first payments customers tend to skip in time of
economic insecurity. The Company finances the main and often only vehicle in the
household that is needed to get our customers to and from work. The amounts we
finance are much lower than most of our competitors, and therefore the payments
are significantly lower, too. The

                                       18

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combination of financing a "need" over a "want" and making that loan on
comparatively affordable terms incentivizes our customers to prioritize their
account with us.



                                             Three months ended            Nine months ended
                                                December 31,                 December 31,
                                               (In thousands)               (In thousands)
                                            2021           2020           2021          2020
Portfolio Summary
Average finance receivables (1)           $ 176,949      $ 192,966      $ 179,333     $ 203,996
Average indebtedness (2)                  $  64,824      $ 101,522      $  72,002     $ 112,476
Interest and fee income on finance
receivables                               $  12,240      $  13,180      $  37,406     $  41,395
Interest expense                              2,613          1,442          4,923         4,660
Net interest and fee income on finance
receivables                               $   9,627      $  11,738      $  32,483     $  36,735
Gross portfolio yield (3)                     27.67 %        27.32 %        27.81 %       27.06 %
Interest expense as a percentage of
average finance receivables                    5.91 %         2.99 %         3.66 %        3.05 %
Provision for credit losses as a
percentage of average finance
  receivables                                  3.79 %         1.35 %         2.83 %        4.58 %
Net portfolio yield (3)                       17.97 %        22.98 %        21.32 %       19.43 %
Operating expenses as a percentage of
average finance receivables                   20.04 %        15.35 %        18.68 %       14.96 %
Pre-tax yield as a percentage of
average finance receivables (4)               (2.07 )%        7.63 %         2.64 %        4.47 %
Net charge-off percentage (5)                  5.67 %         6.30 %         4.70 %        5.94 %
Finance receivables                                                     $ 176,173     $ 188,626
Allowance percentage (6)                                                     2.06 %        4.81 %
Total reserves percentage (7)                                                6.00 %        8.76 %

Note: All three-month and nine-month revenue performance indicators expressed as a percentage have been annualized.

(1)

Average finance receivables represent the average of the month-end finance
receivables throughout the period.
(2)
Average indebtedness represents the average outstanding borrowings at day-end
under the Credit Facility throughout the period. Average indebtedness does not
include the PPP loan.
(3)
Gross portfolio yield represents interest and fee income on finance receivables
as a percentage of average finance receivables. Net portfolio yield represents
(a) interest and fee income on finance receivables minus (b) interest expense
minus (c) the provision for credit losses, as a percentage of average finance
receivables.
(4)
Pre-tax yield represents net portfolio yield minus operating expenses
(marketing, salaries, employee benefits, depreciation, and administrative), as a
percentage of average finance receivables.
(5)
Net charge-off percentage represents net charge-offs (charge-offs less
recoveries) divided by average finance receivables outstanding during the
period.
(6)
Allowance percentage represents the allowance for credit losses divided by
finance receivables outstanding as of ending balance sheet date.
(7)
Total reserves percentage represents the allowance for credit losses, purchase
price discount, and unearned dealer discounts divided by finance receivables
outstanding as of ending balance sheet date.

Mining strategy

The Company remains committed to its branch-based model and its core product of
financing primary transportation to and from work for the subprime borrower
through the local independent automobile dealership. The Company strategically
employs the use of centralized servicing departments to supplement the branch
operations and improve operational efficiencies, but its focus is on its core
business model of decentralized operations. The Company's strategy also includes
risk-based pricing (rate, yield, advance, term, collateral value) and a
commitment to the underwriting discipline required for optimal portfolio
performance as opposed to chasing competition for the sake of simply generating
volume. The Company's principal goals are to increase its profitability and its
long-term shareholder value. During fiscal 2022, the Company is focusing on the
following items:

•

maintain our commitment to the local branch model;

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•

expanding the local branch model into new states;
•
identifying additional ancillary products to enhance profitability and asset
performance;
•
continuing to focus on strategic acquisitions or bulk portfolio purchases to
accelerate total revenue;
•
ensuring that Direct Loans are available in all our existing branch offices
based on the applicable regulatory requirements.

The Company continues to focus on selecting the right markets to have branch
locations. As of December 31, 2021, the Company operated brick and mortar branch
locations in 18 states - Alabama, Florida, Georgia, Idaho, Illinois, Indiana,
Kentucky, Michigan, Missouri, North Carolina, Nevada, Ohio, Pennsylvania, South
Carolina, Tennessee, Texas, Utah and Wisconsin. The Company also originated
business in its expansion states of Kansas without a physical branch in such
markets.

The Company is currently licensed to provide Direct Loans in 14 states- Alabama,
Florida, Georgia (over $3,000), Illinois, Indiana, Kansas, Kentucky, Michigan,
Missouri, North Carolina, Ohio, Pennsylvania, South Carolina, and Tennessee. The
Company solicits current and former customers in these states for the purpose of
providing Direct Loans to such customers, and intends to continue the expansion
of its Direct Loan capabilities to the other states in which it acquires
Contracts. Even with this targeted expansion, the Company expects its total
Direct Loans portfolio to remain between 8% and 15% of its total portfolio for
the foreseeable future.

Analysis of Credit Losses

The Company uses a trailing six-month charge-off analysis, annualized, to
calculate the allowance for credit losses. Management believes that using the
trailing six-month charge-off analysis, annualized, will more quickly reflect
changes in the portfolio as compared to a trailing twelve-month charge-off
analysis.

In addition, the Company takes into consideration the composition of the
portfolio, current economic conditions, estimated net realizable value of the
underlying collateral, historical loan loss experience, delinquency,
non-performing assets, and bankrupt accounts when determining management's
estimate of probable credit losses and adequacy of the allowance for credit
losses. By including recent trends such as delinquency, non-performing assets,
and bankruptcy in its determination, management believes that the allowance for
credit losses reflects the current trends of incurred losses within the
portfolio and is better aligned with the portfolio's performance indicators.

If the allowance for credit losses is determined to be inadequate, then an
additional charge to the provision is recorded to maintain adequate reserves
based on management's evaluation of the risk inherent in the loan portfolio.
Conversely, the Company could identify abnormalities in the composition of the
portfolio, which would indicate the calculation is overstated and management
judgement may be required to determine the allowance of credit losses for both
Contracts and Direct Loans.

Non-performing assets are defined as accounts that are contractually delinquent
for 61 or more days past due or Chapter 13 bankruptcy accounts. For these
accounts, the accrual of interest income is suspended, and any previously
accrued interest is reversed. Upon notification of a bankruptcy, an account is
monitored for collection with other Chapter 13 accounts. In the event the
debtors' balance is reduced by the bankruptcy court, the Company will record a
loss equal to the amount of principal balance reduction. The remaining balance
will be reduced as payments are received by the bankruptcy court. In the event
an account is dismissed from bankruptcy, the Company will decide based on
several factors, whether to begin repossession proceedings or allow the customer
to begin making regularly scheduled payments.

The Company defines a Chapter 13 bankruptcy account as a Troubled Debt
Restructuring ("TDR"). Beginning March 31, 2018, the Company allocated a
specific reserve using a look back method to calculate the estimated losses.
Based on this look back, management calculated a specific reserve of
approximately $77,000 and $118,000 for these accounts as of December 31, 2021
and December 31, 2020, respectively.

The provision for credit losses increased to $1.7 million for the three months
ended December 31, 2021 as compared to $0.7 million for the three months ended
December 31, 2020. A smaller provision for credit losses taken during the three
months ended December 31, 2020 was attributable to an alignment of total loss
reserves with the declining trend of net charge-off percentage (see note 5 in
the Portfolio Summary table in the "Introduction" above for the definition of
net charge-off percentage).

Net charge-offs decreased to 4.70% for the fiscal year ended December 31, 2021
from 5.94% for the fiscal year ended December 31, 2020, primarily resulting from
the Company's active management of the portfolio. The delinquency percentage for
Contracts more than twenty-nine days past due, excluding Chapter 13 bankruptcy
accounts, as of December 31, 2021 was 10.28%, a decrease from 11.49% as of
December 31, 2020. The delinquency percentage for Direct Loans more than
twenty-nine days past due, excluding Chapter 13 bankruptcy accounts, as of
December 31, 2021 was 4.28%, a decrease from 5.23% as of December 31, 2020. The
changes in delinquency percentage for both Contracts and Direct Loans was driven
primarily by the Company's continued focus on local

                                       20

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branch service. Based on these actions, improved service and stricter underwriting policies, management has seen an improvement in delinquency rates.

In accordance with our policies and procedures, certain borrowers qualify for,
and the Company offers, one-month principal payment deferrals on Contracts and
Direct Loans. For further information on deferrals, please see the disclosure
under "COVID-19" above.

Three months completed December 31, 2021 compared to the three months ended December 31, 2020

Interest and commission income on financial receivables

Interest and fee income on finance receivables, which consist predominantly of
finance charge income, decreased 7.6% to $12.2 million for the three months
ended December 31, 2021, from $13.2 million for the three months ended December
31, 2020. The decrease was primarily due to a 8.3% decrease in average finance
receivables to $176.9 million for the three months ended December 31, 2021, when
compared to $193.0 million for the corresponding period ended December 31, 2020.
The decrease in finance receivables was primarily the result of a reduction in
the aggregate dollar amount and volume of Contracts purchased, as the Company
continued implementing its strategic focus of financing primary transportation
to and from work for the subprime borrower. Continuing this operating strategy
allowed us, despite continuing competitive pressure, to acquire Contracts at
similar yields (albeit lower discounts) during the three months ended December
31, 2021, compared to the corresponding period ended December 31, 2020, although
the combined effect of the same average yield and lower discount could not
entirely offset the reduction in the aggregate dollar amount of Contracts
purchased.

The gross portfolio yield increased to 27.67% for the three months ended
December 31, 2021, compared to 27.32% for the three months ended December 31,
2020. The net portfolio yield decreased to 17.97% for the three months ended
December 31, 2021, compared to 22.98% for the three months ended December 31,
2020. The net portfolio yield decreased primarily due to the increase in the
provision for credit losses, as described under "Analysis of Credit Losses".

Functionnary costs

Operating expenses increased to $8.9 million for the three months ended December
31, 2021 compared to $7.4 million for the three months ended December 31, 2020.
The increase in operating expenses was primarily attributed to administrative,
salaries and employee benefits expenses. Operating expenses as a percentage of
average finance receivables, increased to 20.04% for the three months ended
December 31, 2021 from 15.35% for the three months ended December 31, 2020 due
to a proportionally greater decline in finance receivables.

Provision charge

The provision for credit losses increased to $1.7 million for the three months
ended December 31, 2021 from $0.7 million for the three months ended December
31, 2020. A smaller provision for credit losses taken during the three months
ended December 31, 2020 was attributable to an alignment of total loss reserves
with the rapidly declining trend of net charge-off percentage.

Interest charges

Interest expense was $2.6 million for the three months ended December 31, 2021,
of which the Company recognized approximately $1.9 million of interest expense
related to previously incurred but unamortized debt issuance costs on the
extinguishment of the Ares credit facility, and $1.4 million for the three
months ended December 31, 2020. The following table summarizes the Company's
average cost of borrowed funds, exclusive of debt origination costs:



                                                        Three months ended
                                                           December 31,
                                                        2021           2020

Variable interest under the line of credit facility 0.41% 1.93% Credit spread under the line of credit facility

            2.82 %        3.75 %
Average cost of borrowed funds                             3.23 %        5.68 %




SOFR rates have decreased to 0.05%, which represents the one-month SOFR rate as
required under our Wells Fargo Credit Facility, as of December 31, 2021 compared
to 0.14%, which represents the one-month LIBOR rate as required under our Line
of Credit, as of December 31, 2020. For further discussions regarding interest
rates see "Note 5-Credit Facility".

                                       21

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Income Taxes

The Company recorded a tax saving of approximately $209,000 for the three months ended December 31, 2021 compared to an income tax charge of approximately $1,190,000 for the three months ended December 31, 2020. The Company’s effective tax rate decreased to 22.9% for the three months ended
December 31, 2021 23.9% for the three months ended December 31, 2020.

End of nine months December 31, 2021 compared to nine months ended December 31, 2020

Interest income and loan portfolio

Interest and fee income on finance receivables, decreased 9.6% to $37.4 million
for the nine months ended December 31, 2021 from $41.4 million for the nine
months ended December 31, 2020. The decrease was primarily due to 12.1% decrease
in average finance receivables to $179.3 million for the nine months ended
December 31, 2021 when compared to $204.0 million for the corresponding period
ended December 31, 2020. The decrease in average finance receivables was
primarily the result of a reduction in the aggregate dollar amount and volume of
Contracts purchased, as the Company continued implementing its renewed strategic
focus of financing primary transportation to and from work for the subprime
borrower. This shift in focus also allowed us to acquire Contracts at higher
yields during the nine months ended December 31, 2021 compared to acquisitions
during the corresponding period ended December 31, 2020, although the increase
in average yield could not entirely offset the reduction in the aggregate dollar
amount of Contracts purchased.



The gross portfolio yield increased to 27.81% for the nine months ended December
31, 2021, compared to 27.06% for the nine months ended December 31, 2020. The
net portfolio yield increased to 21.32% for the nine months ended December 31,
2021 compared to 19.43% for the nine months ended December 31, 2020,
respectively. The net portfolio yield increased primarily due to a decrease in
the provision for credit losses, as described under "Analysis of Credit Losses".

Functionnary costs

Operating expenses increased to approximately $25.1 million for the nine months
ended December 31, 2021 from approximately $22.9 million for the nine months
ended December 31, 2020. Operating expenses as a percentage of average finance
receivables increased to 18.7% for the nine months ended December 31, 2021 from
15.0% for the nine months ended December 31, 2020. These increased percentages
were attributed to an increase in administrative, and salaries and employee
benefits expense as well as a decrease in the average finance receivables
balances.

Provision charge

The provision for credit losses decreased to $3.8 million for the nine months
ended December 31, 2021 from $7.0 million for the nine months ended December 31,
2020, largely due to a 12.1% decrease in the average finance receivables and a
decrease in the net charge-off percentage to 4.7% for the nine months ended
December 31, 2021 from 5.9% for the nine months ended December 31, 2020.

Interest charges

Interest expense was $4.9 million for the nine months ended December 31, 2021,
of which the Company recognized approximately $1.9 million of interest expense
related to previously incurred but unamortized debt issuance costs on the
extinguishment of the Ares credit facility, and $4.7 million for the nine months
ended December 31, 2021. The following table summarizes the Company's average
cost of borrowed funds, exclusive of debt origination costs:



                                                        Nine months ended
                                                           December 31,
                                                        2021           2020

Variable interest under the line of credit facility 0.80% 1.77% Credit spread under the line of credit facility

            3.44 %       3.75 %
Average cost of borrowed funds                             4.24 %       5.52 %




                                       22

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Income Taxes

The Company recorded an income tax expense of approximately $926,000 for the nine months ended December 31, 2021 compared to an income tax charge of approximately $1,711,000 for the nine months ended December 31, 2020. The Company’s effective tax rate increased to 26.0% for the nine months ended
December 31, 2021 20.9% for the nine months ended December 31, 2020.

Procurement

As of December 31, 2021, the Company purchases Contracts in the states listed in
the table below. The Contracts purchased by the Company are predominantly for
used vehicles; for the three-month periods ended December 31, 2021 and 2020,
less than 1% were for new vehicles.

The following tables present selected information on Contracts purchased by the
Company.



                                  Three months ended          Nine months ended
        As of December 31,           December 31,                December 31,
               2021                2021          2020         2021          2020
             Number of               Net Purchases              Net Purchases
State        branches               (In thousands)              (In thousands)
FL                       11     $    3,388     $  3,549     $   9,621     $ 11,585
OH                        6          2,539        2,466         8,677        7,517
GA                        5          2,247        2,126         7,664        7,590
KY                        3          1,003        1,023         3,802        3,225
MO                        2          1,135        1,022         3,920        3,264
NC                        3          1,752          862         4,710        3,138
IN                        2          1,071          547         3,150        2,149
SC                        3          1,376          611         3,587        2,812
AL                        2            911          728         2,695        1,702
MI                        2            800          510         2,103        1,506
NV                        1            557          378         1,751          978
TN                        1            486          636         1,449        1,954
IL                        1            356          267         1,102          681
PA                        1            622          272         1,354          819
TX                        1            516            -         1,178            -
WI                        1            312           88           832          155
ID                        1            186          169           560          256
UT                        1             69           17           300           43
AZ                        -            154            -           210            -
KS                        -              -           14             -           14
Total                    47     $   19,480     $ 15,285     $  58,665     $ 49,388




                                Three months ended                   Nine months ended
                                   December 31,                        December 31,
                             (Purchases in thousands)            (Purchases in thousands)
       Contracts              2021               2020             2021               2020
Purchases                 $     19,480       $     15,285     $     58,665       $     49,388
Average APR                       23.1 %             23.4 %           23.1 %             23.5 %
Average discount                   6.8 %              7.5 %            6.8 %              7.4 %
Average term (months)               47                 46               47                 46
Average amount financed   $     11,228       $     10,307     $     10,906       $     10,132
Number of Contracts              1,735              1,483            5,389              4,878




                                       23

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Direct Loan Origination

The following table presents selected information on Direct Loans originated by
the Company.



                                                  Three months ended                      Nine months ended
                                                     December 31,                           December 31,
              Direct Loans                    (Originations in thousands)            (Originations in thousands)
               Originated                      2021                2020               2021                 2020
Purchases/Originations                     $       8,505       $       4,605     $       21,282       $       10,864
Average APR                                         31.8 %              30.9 %             30.6 %               29.6 %
Average term (months)                                 24                  22                 25                   24
Average amount financed                    $       3,661       $       3,641     $        4,173       $        4,054
Number of loans                                    2,282               1,265              5,186                2,744

Cash and capital resources

The Company’s cash flows are summarized as follows:

                                     Nine months ended
                                       December 31,
                                      (In thousands)
                                    2021          2020
Cash provided by (used in):
Operating activities              $   1,824     $   8,266
Investing activities                  6,835        26,845
Financing activities                (35,106 )     (30,534 )

(Decrease) net increase in cash ($26,447) $4,577

The Company’s primary use of working capital for the quarter ended December 31, 2021 was, and will continue to be for the foreseeable future, to fund the purchase of contracts, which are funded largely with cash from principal and interest payments received, and the company’s credit facility .

On November 5, 2021, NFI and its direct parent, Nicholas Data Services, Inc.
("NDS" and collectively with NFI, the "Borrowers"), entered into a senior
secured credit facility (the "Credit Facility") pursuant to a loan and security
agreement by and among the Borrowers, Wells Fargo Bank, N.A., as agent, and the
lenders that are party thereto (the "Credit Agreement"). The Ares Credit
Facility was paid off in connection with entering into the Credit Facility.



Pursuant to the Credit Agreement, the lenders have agreed to extend to the
Borrowers a line of credit of up to $175,000,000. The availability of funds
under the Credit Facility is generally limited to an advance rate of between 80%
and 85% of the value of eligible receivables, and outstanding advances under the
Credit Facility will accrue interest at a rate equal to the Secured Overnight
Financing Rate (SOFR) plus 2.25%. The commitment period for advances under the
Credit Facility is three years (the expiration of that time period, the
"Maturity Date").



Pursuant to the Credit Agreement, the Borrowers granted a security interest in
substantially all of their assets as collateral for their obligations under the
Credit Facility. Furthermore, pursuant to a separate collateral pledge
agreement, NDS pledged its equity interest in NFI as additional collateral.



The Credit Agreement and the other loan documents contain customary events of
default and negative covenants, including but not limited to those governing
indebtedness, liens, fundamental changes, investments, and sales of assets. If
an event of default occurs, the lenders could increase borrowing costs, restrict
the Borrowers' ability to obtain additional advances under the Credit Facility,
accelerate all amounts outstanding under the Credit Facility, enforce their
interest against collateral pledged under the Credit Facility or enforce such
other rights and remedies as they have under the loan documents or applicable
law as secured lenders.



If the lenders terminate the Credit Facility following the occurrence of an
event of default under the loan documents, or the Borrowers prepay the loan and
terminate the Credit Facility prior to the Maturity Date, then the Borrowers are
obligated to pay a termination or prepayment fee in an amount equal to a
percentage of $175,000,000, calculated as 2% if the termination or prepayment
occurs during year one, 1% if the termination or repayment occurs during year
two, and 0.5% if the termination or prepayment occurs thereafter.

                                       24

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The Company will continue to depend on the availability the Credit Facility,
together with cash from operations, to finance future operations. The
availability of funds under the Credit Facility generally depends on
availability calculations as defined in the Credit Agreement. See also the
disclosure in Note 5. Credit Facility in this Form 10-Q, which is incorporated
herein by reference.



On May 27, 2020, the Company obtained a loan in the amount of $3,243,900 from a
bank in connection with the U.S. Small Business Administration's ("SBA")
Paycheck Protection Program (the "PPP Loan"). Pursuant to the Paycheck
Protection Program, all or a portion of the PPP Loan may be forgiven if the
Company uses the proceeds of the PPP Loan for its payroll costs and other
expenses in accordance with the requirements of the Paycheck Protection Program.
The Company used the proceeds of the PPP Loan for payroll costs and other
covered expenses and sought full forgiveness of the PPP Loan, but there can be
no assurance that the Company will obtain any forgiveness of the PPP Loan. The
Company submitted the forgiveness application to Fifth Third Bank, the lender,
on December 7, 2020 and submitted supplemental documentation on January 16,
2021. On December 27, 2021 SBA informed the Company that forgiveness in the
amount of $0.00 is appropriate. The Company filed an appeal with SBA on January
5, 2022. The Company cannot predict whether the appeal will be successful. While
the Company awaits the SBA response to the appeal, the loan payments are
deferred.



Unless the Company is successful on appeal, the outstanding principal balance
plus accrued and unpaid interest (accruing at the rate of 1.00% per annum) is
due on May 22, 2022. The PPP Loan is unsecured. The PPP Loan may be prepaid at
any time prior to maturity with no prepayment penalties. The related promissory
note contains events of default and other provisions customary for a loan of
this type.

Off-balance sheet arrangements

The Company does not engage in any off-balance sheet financing arrangements.

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© Edgar Online, source Previews

The new year brings with it a host of new restaurants to try in Solihull.

The borough’s food scene has not only weathered the storm of the Covid pandemic, but it’s emerging more diverse than ever.

In the last year alone, the town has seen the arrival of several new names, including the French-inspired brasserie, Cote, on the high street and the independent British restaurant, The Fox, near Catherine-de- Barnes.

Read more – Plans submitted for the new Solihull shopping center assimilated to Bicester Village

The Touchwood Mall also welcomed the return of Handmade Burger, which reopened in January after the collapsed brand was saved by a former employee.

And foodies can expect more good things to come in 2022, with various openings bringing cuisines from around the world to the borough.

From flavor-packed Indian grills to Japanese sushi rolls and a seven-course British tasting menu, we’ve prepared a roundup of some of the new menus coming to the region this year.

Toffs

Celebrity hotel chef Rob Palmer is due to open his first restaurant in Solihull town center in March.

“Toffs” will be the first solo venture of local chef Rob Palmer, the former head chef of Hampton Manor who won the hotel’s Peel’s restaurant its first Michelin star in 2016.

The 34-year-old cook, from Castle Bromwich, is opening the fine dining restaurant in the former CeX unit in Drury Lane.

Diners will be treated to a seasonal six- to seven-course tasting menu centered around fresh British produce in an industrial-style setting, with just 26 seats and an open kitchen.

Readers can read more about the new Toffs restaurant here.

aioli

This new Spanish tapas bar promises to bring a slice of the Mediterranean coast to downtown Solihull.

Independent restaurant Alioli is set to launch in the former Bella Italia unit, with a pledge to “revive the Spanish food scene in the Midlands”.

The restaurant was originally slated to open last year, but bosses are now looking to get the restaurant up and running in the spring.

Alioli will serve authentic tapas with a contemporary twist, including its own version of the popular Catalan sauce that gave the bar its name.

There is more information about Alioli here.

Tavern Soho

The former Beeches site in Hampton-in-Arden has been taken over by a popular Indian restaurant in Birmingham, with ambitious plans to turn the vacant site into a modern gastropub.

Soho Tavern is expected to open in April/May.

The owners already run a well-known restaurant of the same name in Park Road, which has become famous for its mixed grills and spicy chilli crisps.

CGI footage of the new restaurant shows a bright, modern dining area, with a view of the bowling green, and a separate drinks area with a TV playing sports.

To learn more about Soho Tavern Solihull, click here.

KIBOU

The KIBOU Japanese kitchen and bar is set to launch inside the Grade II listed Main Street space previously occupied by Café Rouge.

Famous for its sushi rolls, the restaurant will serve a range of classic and contemporary Japanese dishes – from bowls of steaming ramen to steamed bao buns and handmade gyoza.

The menu will include KIBOU’s signature volcano roll – with salmon, avocado and tobiko futomaki, fried tempura and served with house sauce – as well as an extensive vegan offering, a range of “moriawase” sharing platters and Japanese-inspired desserts .

Due to open in April this year, KIBOU’s new Solihull restaurant will feature a mesmerizing décor similar to its existing locations in Battersea, Cheltenham and Clifton in London – with opulent Japanese print textiles and brightly colored wall coverings.

There will also be a stand-alone bar serving signature Japanese cocktails, non-alcoholic and non-alcoholic options, a selection of whiskey, sake and umeshu, as well as brewed beers and authentic high-balls.

Learn more about KIBOU here.

Stay up to date with the latest in the area with our MySolihull News email updates.

Small banks later tell booming business to buy now/pay later.

About eight in 10 community bank executives have ‘little or no interest’ in offering consumer installment loans, according to an IntraFi Network survey of key executives at banks with up to $10 billion in business assets.

Some 14% of executives said they would like to offer the loans in partnership with an outside fintech company, rather than doing it alone. Only 2% of respondents said they already offer the service or are actively planning to do so.

“Banks aren’t lining up to offer BNPL, and those that do would prefer to partner with a fintech,” said Paul Weinstein, senior adviser at IntraFi.

Worldwide, the buy-now/pay-later boom reached more than $100 billion in loans last year, according to Cornerstone Advisors. Major providers include PayPal, Affirm, Klarna and Afterpay, which is being acquired by Block, the company formerly known as Square.

Buy-it-now and pay-later providers often allow consumers to pay for purchases at checkout in four interest-free payments, even with little or no credit history.

Merchants pay providers a fee, often a percentage of the transaction up to 8%. Consumers who miss payments are often charged late fees, which can be another source of revenue.

Some major banks, including Goldman Sachs and Capital One Financial, got into the business as a way to boost non-interest income at a time when interest rates were held near historic lows.

But other banks are more skeptical of the fast-growing product. Cullen/Frost Bankers, a $50.9 billion asset company in San Antonio, Texas, has an aggressive organic growth plan, but it doesn’t include buy now/pay later business, according to the CEO Phil Green.

“What could go wrong there, right?” Green said in a recent interview.

In December, the Consumer Financial Protection Bureau announced a survey of five buy now/pay later companies. The bureau said it asked Affirm, Afterpay, Klarna, PayPal and Zip for information about their practices and how their offerings could affect consumer debt levels.

The IntraFi survey, which was conducted in early January, took the pulse of CEOs, CFOs and other executives at 426 small banks.

It showed that some bankers expect the easy flow of deposits to begin to slow. Around 40% of respondents said they thought deposit competition would increase moderately in 12 months, compared to 29% who had given the same prediction three months earlier.

“There’s going to be a tighter market for deposits,” Weinstein predicted.

More than half of executives surveyed said they expect demand for loans to increase at least moderately over the next year. But it could take time for the industry’s suppressed loan-to-deposit ratios to return to normal. Demand for loans has been reduced during the COVID-19 pandemic as consumers and businesses have used government stimulus funds to build up reserves.

About 43% of small bank executives surveyed said they expected loan-to-deposit ratios to return to pre-pandemic levels in 2023, while 39% said it wouldn’t happen until 2024 or later. .

IntraFi’s findings also suggest the pandemic may have changed how smaller banks view their branches. Among banks that have closed branches since the start of 2020, around 53% of respondents pointed to a lack of foot traffic due to increased use of online banking options by customers.

“COVID is not identified as the primary reason,” Weinstein said. “But it is clear that the virus has accelerated digital channels so that you no longer have to go to your agency. People have become much more comfortable with online banking.”

There has been a lot of hype in the media about buy-it-now-pay-later (BNPL) solutions in 2021. It’s no wonder BNPL has risen to prominence. Fueled by the COVID-19 pandemic, e-commerce transactions as a percentage of total retail sales grew rapidly in 2021, and an estimated 20% of American adults used BNPL in the past year.

The first generation of BNPL solutions that became available in the market offered installment loans, and this is still the most common BNPL offer. With this type of financing, a consumer applies once for a short-term loan to finance a single transaction over a fixed number of installments. This provides limited benefit to those who purchase and market goods and services, particularly merchants whose products lend themselves to recurring or subscription purchases (e.g. cosmetics, pet supplies, automotive accessories, etc.) . When that loan matures, the funding closes with it. Consumers must apply for a new installment loan each time they make a purchase.

The rise of digital revolving credit

In 2022, a new category of e-commerce finance will gain prominence in the BNPL space to cater to this popular purchase category: recurring purchases. Digital revolving credit offers far greater benefits to merchants, allowing them to leverage predictable revenue streams and create loyal, long-term customers. It refers to an account that the consumer can open and then reuse over and over again, instead of repaying a single purchase on a short-term installment schedule and terminating the loan. It therefore lends itself to these recurring purchases by subscription.

Digital revolving credit will usher in a more merchant-centric era of e-commerce payments in the BNPL space. Benefits for merchants include the ability to foster better brand loyalty and increased customer lifetime value (CLV). A continuous, open line of credit is a much more merchant-friendly construct than offering installment loans.

This more flexible “lifecycle credit” approach will gain traction, allowing consumers to open a reusable line of credit with a merchant. It can be maintained over the long term, drawn again and again from a network of approved merchants. The repayment schedule is flexible over as many months as the customer wants, unlike a fixed installment loan which typically has to be repaid in four months. This could best be described as “buy often, pay much later” as opposed to “buy now, pay later”.

Additionally, a closed-loop digital credit platform operates off the traditional credit card “rails”. A history of all customer purchases from all network merchants is kept in the system. This facilitates inter-merchant marketing, whereby the products of other complementary merchants can be marketed to buyers.

Benefits for merchants and consumers

This is not only convenient for consumers, but also beneficial for merchants, as the credit provider can maintain a long-term relationship with that customer over one-time BNPL transactions. In addition to building loyalty, it also reduces acquisition costs. A digital revolving credit model has proven to be the most stable business option, as customers who have long-term relationships with their payment providers have more incentive to stay in good standing, so they tend to default less .

A recent informal survey of e-commerce systems integrators conducted by FuturePay revealed that approximately 40% of their merchant customers have already implemented a BNPL solution. This indicates a good remaining market opportunity for BNPL. Merchants who have not yet implemented a BNPL option (and even those who do) will want to consider the distinctions between BNPL installment loan providers and digital revolving credit solutions, as the differentiators directly impact on aligning the financing solution with their long-term goals.

Since BNPL installment loan providers only offer short-term loans, they are generally less demanding about the credit status of buyers, which has recently led to increased regulatory scrutiny. On the other hand, revolving credit implies an ongoing customer relationship. As a result, only qualified consumers with viable credit profiles are accepted. And with today’s sophisticated credit underwriting technology, these applicants can be approved in seconds.

When consumers are incentivized to reuse their line of credit and establish a long-term relationship with the supplier, it increases CLV. Since it takes far more resources to acquire a new customer than to nurture one, this is an important metric. The more user-friendly approach of digital revolving credit, compared to BNPL installment loans, will lead to increased adoption in 2022 and beyond.

Tim Harris is CEO of FuturePay Holdings Inc.

Shanghai’s iconic Yuyuan Garden Malls launched its annual Chinese New Year celebration on Tuesday, featuring traditional lanterns and heritage crafts, amid strict COVID-19 prevention measures.

Hundreds of colorful lanterns, listed as national cultural heritage, will come alive every evening from Tuesday, featuring various cartoon figures of the tiger to mark the Year of the Tiger.

Various traditional lanterns, such as the palace painting, flower and New Year lanterns, with New Year wishes to visitors, such as “healthy”, “happy” and “wealthy”, were lit throughout the Ming (1368-1644) and Qing Dynasty (1644-1911) style buildings. The lights will stay on until February 18.

The shopping malls, restaurants and shops near the historic garden were born from a thriving city god temple market about 140 years ago.

The main attraction is a 9-meter-tall golden tiger standing on a mountain in the central square of the malls, accompanied by a group of tiger cubs dressed as an astronaut, winter Olympic athletes or an aircraft carrier commander .

China’s major achievements in recent years are also featured in various lanterns, including Fuxing (Rejuvenation) high-speed train, 5G communication network, and super computer.

Another major attraction has been installed on the iconic Zigzag Bridge, with lanterns on the 24 solar terms and traditional Chinese culture. An installation with light, mist and shadow will be performed on the bridge every evening to create an immersive experience for visitors.

Many festive traditions from Jiangnan, or regions of the lower Yangtze River, are incorporated into the lanterns. The little tigers, for example, taste the spring rolls for lichun, where spring begins; watch peach blossoms on jingzhe, or the insects wake up; and make wine in chunfen, or vernal equinox.

The Yuyuan Garden area is the origin of Shanghai’s urban culture as well as Jiangnan culture. Key installations on the bridge aim to bring back memories of traditions, organizers said.

It is a tradition in the old town of Shanghai to cross the zigzag bridge for the Lunar New Year. It is said that the bridge can help get rid of bad luck, because ghosts and evil spirits can only walk straight.

Many popular Shanghai traditional skills are also displayed in shopping malls as part of the festive celebration.

The young chefs of the Shanghai Classic Hotel, known for its authentic Shanghainese-style cuisine, for example, will kousansi, or braised “three shreds”, a classic local dish requiring superior knife skills.

238-year-old Tonghanchun TCM pharmacy invites visitors to taste pear syrup herbal drink ligao read, inspired by the traditional candy with pear syrup.

Yuyuan Garden shopping malls have more than 30 intangible cultural heritages, including two national-level skills – Spring Festival Lantern Fair and Shanghai Classic Hotel Culinary Skills.

Other intangible heritages include Nanxiang Steamed Buns, Spicy Beans, City God Temple Fair, and Middle Lake Pavilion Tea Art.

Selected masters and artists will present traditional performances and teach basic skills in a workshop class until February 18.

Visitors are also invited to listen to a traditional concert of string and bagpipe music on the Beaufort Terrace, the stage for traditional Chinese operas and cuisine. Yueju and Kunqu traditional operas will also be performed during the festival.

More people are expected to stay in the city over the Lunar New Year due to the recent resurgence of locally transmitted COVID-19 cases.

Strict preventive measures are in place in shopping centres. Visitors are required to register their real name, show the health code and receive temperature checks at mall entrances as well as wear masks.

Epidemic period

Shanghai will remain in the epidemic period of the Omicron variant of COVID-19 during the Spring Festival, according to Dr. Zhang Wenhong, head of Shanghai’s COVID-19 treatment team and director of the National Center for Infectious Diseases.

It is vital for every citizen to maintain good health habits and personal protection during the festival, Zhang said, adding that such efforts will enable people to enjoy a normal life in Shanghai during this time.

“COVID-19 prevention not only depends on doctors, immune barrier and vaccines, but also on the health habits of every citizen,” Zhang said at the unveiling of an educational health awareness book. and disease prevention and control.

The book will be distributed to some 8 million families to build public health capacity, especially during the COVID-19 pandemic, the Shanghai Health Commission said.

If you are going to:

New Year celebration period: until February 18

Admission: Free (except five days during the Lantern Festival)

Public transport: Metro Line 14, exit n°7

COVID-19 prevention: Sanitary code, masks and mandatory temperature checks

Opening hours: 10 a.m. – 10 p.m. (Closed at 5:30 p.m. on January 31)

Jiang Xiaowei / SHINE

Visitors are required to wear masks in Yuyuan Garden shopping malls.

In a busy little alleyway in Bengaluru, a nondescript restaurant – Sri Siddeshwara – keeps the taste of northern Karnataka alive in Silicon Valley with IT pros from all over the world. The restaurant looks very ordinary and unplanned compared to other chic cafes in the locality in terms of ambiance, but what it offers is nutritious food with an authentic taste of northern Karnataka. Better yet, the meals are moderately priced and frequented by students and young office workers who reside in the neighborhood.

The history of this restaurant began in 2013 when four brothers – Raiappa, Narsima, Prashant and Srisai – migrated to Bengaluru from their hometown of Ainapur in the Belgaum district of northern Karnataka in search of work. Older brother Raiappa discovered his cooking skills and taught the art to his younger brothers who had never tried cooking.

The brothers had the idea of ​​creating a restaurant in Bangalore, more than 500 kilometers from their native village. After taking out a loan from relatives, they rented a store in Venkateshwara Layout in the SG Palya region south of Bengaluru.

It was not easy and they had to face obstacles due to lack of funding and customers. This led them to analyze the needs of their customers and they soon realized that on weekends, young revelers did not come to their store. They needed their own USP (Unique Selling Proposition). Language was another obstacle for the four brothers because although they spoke Kannada, the clients did not have their North Karnataka accent.

Also read: Deepavali and lehyam love

Eureka! The four brothers decided to start serving traditional and nutritious meals specific to their region of northern Karnataka which borders Maharashtra.

While most of the local restaurants in the SG Palya area served popular dishes such as momos, sandwiches and milkshakes, Sri Siddeshwara began to offer authentic regional cuisine.

The menu includes dishes from northern Karnataka like jolada rotti, avalakki, giramittu, Holige Oota and also other popular food products like idli sambhar, paddu, vada, khara bath and kesari bath. These foods are also very nutritious.

the jolada roti also known as “jolada bhakriIs made with sorghum flour. It is gluten free, rich in antioxidants, vitamins and fiber. It has less carbohydrates and starch and helps reduce body heat as the mercury rises very high in northern Karnataka during the summer months.

Another delicious and also a favorite among sweets lovers is Holige Oota made of wheat, jaggery, ghee and some traditional spices like cardamom, cinnamon, nutmeg and fennel seeds. This festive sweet dish, which the villagers prepare only on special occasions, is served daily at this nondescript restaurant. Holige oota is low in calories and sugar. It contains the benefits of lentils like chana dal (Bengal gram), which is an excellent source of fiber and vitamins, and helps boost immunity and help with digestive issues.

Also read: Puthandu Vazhuthugal: Neem flowers, jaggery and raw mangoes for the Tamil New Year

Avallaki, popularly known as poha, is a gluten-free, easy-to-digest dish. It contains healthy carbohydrates, is high in iron, and helps maintain sugar levels.

This ordinary-looking restaurant offers healthier, tastier food at an affordable price than any glass-fronted restaurant.

As in other sectors, the COVID-19 pandemic has caused considerable business loss to the four brothers who run Sri Siddeshwara. For two months, they distributed the restaurant’s food supply to people for free before migrating to their village during last year’s lockdown. As the situation improved, they returned to Bengaluru to restart their restaurant.

So if you find yourself in southern Bengaluru and ready for some traditional northern Karnataka cuisine, hop on an autorickshaw and head to Venkateshwara Layout in the SG Palya area to enjoy a hearty and nutritious meal at Sri Siddeshwara.

Editor’s Note:

Huge changes have been seen as people continue to adjust to life with the stay of the COVID-19 pandemic and the rapid evolution of various technologies. This series examines these changes and explores the next steps.

The growing trend to stay at home has given rise to a wide range of foods and drinks. Many niche sectors in the food and beverage industry will take center stage as buyer demands change rapidly.

New brands in niche categories are taking note of this trend and will continue to emerge in the years to come.

New sellers of packaged food, partially cooked meals and ready meals are catching up in a rapidly changing consumer landscape.

New marketing channels, live streaming sessions, and social media tools help new brands gain recognition quickly by buyers.

“Preparing food for the family can be awkward sometimes, and luckily there are plenty of pre-cooked and ready-to-reheat meals to choose from,” said Jessie Zhang, senior accountant in Shanghai.

More and more convenience food vendors will seek to use local flavors and seasonal ingredients to appeal to foodies.

A local low-temperature meat producer, Benwei, which means ‘original taste’, received a venture capital investment from the social networking site Xiaohongshu (Red) and successfully launched products ranging from frozen sausages, bacon and from frozen ham slices to pre-cooked dishes. .

Benwei has teamed up with Centennial Yufu, a specialty food brand from Jiangsu and Zhejiang, for its latest offering to use Xuefang Jiang brand Jinhua ham in its precooked dishes, as pork still has a special place in them. Chinese families’ end-of-year meal.

The iiMedia research institute predicts that sales of pre-cooked meals in China will reach 345.9 billion yuan ($ 54.3 billion) by the end of 2021 and maintain a growth rate of around 20% over the course of the year. the next few years to reach 516 billion yuan by 2023..

Most pre-cooked dishes are still limited to a relatively small region, and domestic players and industry watchers also expect regional businesses with distinct characteristics such as specialty flavors that suit a certain geographic location and traditional cuisine are more likely to stand out.

The global shift to healthy and convenient diets has offered significant growth potential for pre-cooked food vendors and catering service providers, said Jason Yu, general manager of Kantar Worldpanel China.

Shanghai’s age-old brands are responding to a government call to upgrade offerings by leveraging data capabilities.

Bright Dairy uses Tmall and its own on-demand platform to promote its new line of probiotic yogurts that target digestive health and wellness. These digital platforms have helped the iconic Shanghai food company regain its brand awareness in the market, and it will continue to improve the digitalization of the latest offerings, including probiotic powdered drinks that target the digestive system.

Shanghai has set a target in the 14th five-year plan (2021-2025) to improve the position of digital economies.

Digitization will play a key role in advancing the quality development of the city and the modernization of its economic structure.

The city is considering further support to major digital economies to develop new business formats where online and offline models become deeply integrated, and the city could thus be home to a group of key digital service providers.

Bear Coming, headquartered in Shanghai, is another local player capitalizing on the tendency of people to expect to cook good, home-cooked meals without needing to prepare the ingredients.

Kelly Huang, a marketing consultant in Shanghai, said she had tried making spaghetti with ready-made tomato bolognese sauce and enjoyed the preparation process.

“It’s easy to make a ready meal in 15 minutes. I plan to try the dressing the next time I choose a healthier meal,” she said.

Compound cooking ingredients like barbecue sauces, black pepper, and sea salt powder are also some of its top-selling products.

Targeting those who want to cook a delicious dish with just one cooking ingredient, the company has included both hobby and bakery cooking ingredients.

Starting with online storefronts on JD, Tmall and short video sites like Douyin and Kuaishou, it has also extended its reach to offline retailers and is expected to cover 5,000 major supermarket chain outlets by the end. of this year.

The Chinese compound cooking ingredients market is estimated at 189 billion yuan this year, with Western-style compound ingredients accounting for about 44% and Chinese-style ingredients about 38%.

Although still at an early stage, some small regional businesses could grow into businesses with tens of billions of market value in the years to come.

For emerging brands, the road to becoming the next unicorn is a tough journey.

Expanding product categories is a critical step for upcoming brands that are rapidly using digital channels and social media to meet otherwise often overlooked niche demands, according to a recent joint study by Bain Co and Kantar Worldpanel. .

After evaluating the performance of 46 emerging local brands in the consumer goods sector, he found that only 17 continued to do well with an annual increase of more than 10 percent in the value of retail sales, while the others reached a plateau with growth below the sector average. rate or did not see an increase in sales.

Competition will intensify for new brands, as multinational companies have also learned to adapt quickly to changing consumer trends and favor niche brands, he suggests.

It is crucial for brands to retain consumers after capturing their first batch of adventurous diners, as new options are eager to take the stage.

The competitive landscape is much more difficult than it was three to five years ago. The bar for challenging incumbents is much higher, as local brands and multinational companies quickly learn from upcoming brands, said Bruno Lannes, partner at Shanghai-based Bain & Company.

Emerging brands and established brands will learn from each other, which could potentially provide gift buyers with a wide variety of choices.