LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES

3 Months Ended

Jun. 30, 2022

Receivables [Abstract]

LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES

LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES

The following is a summary of gross loans receivable by Customer Tenure as of:

Customer Tenure	June 30, 2022		March 31, 2022
0 to 5 months	$	194,927,923	$	198,740,475
6 to 17 months	160,848,310		133,665,566
18 to 35 months	207,136,442		204,940,323
36 to 59 months	239,966,769		208,936,027
60+ months	835,747,165		770,683,149
Tax advance loans	3,171,120		5,823,320
Total gross loans	$	1,641,797,729	$	1,522,788,860

Current payment performance is used to assess the capability of the borrower to repay contractual obligations of the loan agreements as scheduled, which is monitored by management on a daily basis. On an as needed basis, qualitative information may be taken into consideration if new information arises related to the customer’s ability to repay the loan. The Company’s payment performance buckets are as follows: current, 30-60 days past due, 61-90 days past due, 91 days or more past due.

The following table provides a breakdown of the Company’s gross loans receivable by current payment performance on a recency basis and year of origination at June 30, 2022:

	Term Loans By Origination
Loans	Up to 1 Year Ago		Between 1 and 2 Years Ago		Between 2 and 3 Years Ago		Between 3 and 4 Years Ago		Between 4 and 5 Years Ago		More than 5 Years Ago		Total
Current	$	1,413,443,438	$	42,949,978	$	1,879,056	$	185,246	$	21,280	$	3,273	$	1,458,482,271
30 - 60 days past due	66,592,105		3,586,899		228,217		34,196		7,660		—		70,449,077
61 - 90 days past due	41,477,593		2,431,809		156,388		16,082		2,161		4,090		44,088,123
91 or more days past due	59,916,464		5,421,482		235,415		31,860		1,917		—		65,607,138
Total	$	1,581,429,600	$	54,390,168	$	2,499,076	$	267,384	$	33,018	$	7,363	$	1,638,626,609
	Term Loans By Origination
Tax advance loans	Up to 1 Year Ago		Between 1 and 2 Years Ago		Between 2 and 3 Years Ago		Between 3 and 4 Years Ago		Between 4 and 5 Years Ago		More than 5 Years Ago		Total
Current	$	144,236	$	263	$	—	$	—	$	—	$	—	$	144,499
30 - 60 days past due	175,613		100		—		—		—		—		175,713
61 - 90 days past due	381,355		250		—		—		—		—		381,605
91 or more days past due	2,463,844		5,459		—		—		—		—		2,469,303
Total	$	3,165,048	$	6,072	$	—	$	—	$	—	$	—	$	3,171,120
Total gross loans													$	1,641,797,729

The following table provides a breakdown of the Company’s gross loans receivable by current payment performance on a recency basis and year of origination at March 31, 2022:

	Term Loans By Origination
Loans	Up to 1 Year Ago		Between 1 and 2 Years Ago		Between 2 and 3 Years Ago		Between 3 and 4 Years Ago		Between 4 and 5 Years Ago		More than 5 Years Ago		Total
Current	$	1,322,332,136	$	34,273,199	$	2,665,078	$	152,105	$	21,539	$	3,972	$	1,359,448,029
30 - 60 days past due	49,517,859		2,114,463		247,291		28,011		2,664		—		51,910,288
61 - 90 days past due	36,707,960		989,136		130,763		13,031		5,594		—		37,846,484
91 or more days past due	64,238,626		3,239,753		248,596		24,377		5,386		4,001		67,760,739
Total	$	1,472,796,581	$	40,616,551	$	3,291,728	$	217,524	$	35,183	$	7,973	$	1,516,965,540
	Term Loans By Origination
Tax advance loans	Up to 1 Year Ago		Between 1 and 2 Years Ago		Between 2 and 3 Years Ago		Between 3 and 4 Years Ago		Between 4 and 5 Years Ago		More than 5 Years Ago		Total
Current	$	4,737,741	$	7,033	$	—	$	—	$	—	$	—	$	4,744,774
30 - 60 days past due	1,060,811		1,334		—		—		—		—		1,062,145
61 - 90 days past due	—		432		—		—		—		—		432
91 or more days past due	2,922		13,047		—		—		—		—		15,969
Total	$	5,801,474	$	21,846	$	—	$	—	$	—	$	—	$	5,823,320
Total gross loans													$	1,522,788,860

The following table provides a breakdown of the Company’s gross loans receivable by current payment performance on a contractual basis and year of origination at June 30, 2022:

	Term Loans By Origination
Loans	Up to 1 Year Ago		Between 1 and 2 Years Ago		Between 2 and 3 Years Ago		Between 3 and 4 Years Ago		Between 4 and 5 Years Ago		More than 5 Years Ago		Total
Current	$	1,388,940,592	$	37,508,701	$	1,425,635	$	73,430	$	11,419	$	—	$	1,427,959,777
30 - 60 days past due	72,038,034		2,623,783		113,774		3,855		—		—		74,779,446
61 - 90 days past due	46,115,946		2,211,834		66,216		15,268		—		699		48,409,963
91 or more days past due	74,335,028		12,045,850		893,451		174,831		21,599		6,664		87,477,423
Total	$	1,581,429,600	$	54,390,168	$	2,499,076	$	267,384	$	33,018	$	7,363	$	1,638,626,609
	Term Loans By Origination
Tax advance loans	Up to 1 Year Ago		Between 1 and 2 Years Ago		Between 2 and 3 Years Ago		Between 3 and 4 Years Ago		Between 4 and 5 Years Ago		More than 5 Years Ago		Total
Current	$	243,820	$	—	$	—	$	—	$	—	$	—	$	243,820
30 - 60 days past due	179,187		—		—		—		—		—		179,187
61 - 90 days past due	398,880		—		—		—		—		—		398,880
91 or more days past due	2,343,161		6,072		—		—		—		—		2,349,233
Total	$	3,165,048	$	6,072	$	—	$	—	$	—	$	—	$	3,171,120
Total gross loans													$	1,641,797,729

The following table provides a breakdown of the Company’s gross loans receivable by current payment performance on a contractual basis and year of origination at March 31, 2022:

	Term Loans By Origination
Loans	Up to 1 Year Ago		Between 1 and 2 Years Ago		Between 2 and 3 Years Ago		Between 3 and 4 Years Ago		Between 4 and 5 Years Ago		More than 5 Years Ago		Total
Current	$	1,290,448,366	$	29,913,995	$	1,994,474	$	68,836	$	9,586	$	699	$	1,322,435,956
30 - 60 days past due	57,225,953		1,508,794		91,118		5,519		—		—		58,831,384
61 - 90 days past due	45,276,797		1,271,187		96,233		986		—		—		46,645,203
91 or more days past due	79,845,465		7,922,574		1,109,903		142,183		25,598		7,274		89,052,997
Total	$	1,472,796,581	$	40,616,550	$	3,291,728	$	217,524	$	35,184	$	7,973	$	1,516,965,540
	Term Loans By Origination
Tax advance loans	Up to 1 Year Ago		Between 1 and 2 Years Ago		Between 2 and 3 Years Ago		Between 3 and 4 Years Ago		Between 4 and 5 Years Ago		More than 5 Years Ago		Total
Current	$	4,737,741	$	—	$	—	$	—	$	—	$	—	$	4,737,741
30 - 60 days past due	1,060,329		—		—		—		—		—		1,060,329
61 - 90 days past due	—		—		—		—		—		—		—
91 or more days past due	3,404		21,846		—		—		—		—		25,250
Total	$	5,801,474	$	21,846	$	—	$	—	$	—	$	—	$	5,823,320
Total gross loans													$	1,522,788,860

The allowance for credit losses is applied to amortized cost, which is defined as the amount at which a financing receivable is originated, and net of deferred fees and costs, collection of cash, and charge-offs. Amortized cost also includes interest earned but not collected.

Credit Risk is inherent in the business of extending loans to borrowers and is continuously monitored by management and reflected within the allowance for credit losses for loans. The allowance for credit losses is an estimate of expected losses inherent within the Company’s gross loans receivable portfolio. In estimating the allowance for credit losses, loans with similar risk characteristics are aggregated into pools and collectively assessed. The Company’s loan products have generally the same terms therefore the Company looked to borrower characteristics as a way to disaggregate loans into pools sharing similar risks.

In determining the allowance for credit losses, the Company examined four borrower risk metrics as noted below.

1.Borrower type

2.Active months

3.Prior loan performance

4.Customer Tenure

To determine how well each metric predicts default risk the Company uses loss rate data over an observation period of twelve months at the loan level.

The information value was then calculated for each metric. From this analysis management determined the metric that had the strongest predictor of default risk was Customer Tenure. The Customer Tenure buckets used in the allowance for credit loss calculation are:

1.0 to 5 months

2.6 to 17 months

3.18 to 35 months

4.36 to 59 months

5.60+ months

Management will continue to monitor this credit metric on a quarterly basis.

Management estimates an allowance for each Customer Tenure bucket by performing a historical migration analysis of loans in that bucket for the twelve most recent historical twelve-month migration periods, adjusted for seasonality. All loans that are greater than 90 days past due on a recency basis and not written off as of the reporting date are reserved for at 100% of the outstanding balance, net of a calculated Rehab Rate. Management considers whether current credit conditions might suggest a change is needed to the allowance for credit losses by monitoring trends in 60-day delinquencies, FICO scores and average loan size as compared to metrics in the historical migration period. Due to the short term nature of the loan portfolio, forecasted changes in macroeconomic variables such as unemployment do not have a significant impact on loans outstanding at the end of a particular reporting period. Therefore, management develops a reasonable and supportable forecast of losses by comparing the most recent 6-month loss curves as compared to historical loss curves to see if there are significant changes in borrower behavior that may indicate the historical migration rates should be adjusted. If an adjustment is made as a result of the forecast, then the Company has elected to immediately revert back to historical experience past the forecast period.

The following table presents a roll forward of the allowance for credit losses on our gross loans receivable for the three months ended June 30, 2022 and 2021:

	Three months ended June 30,
	2022		2021
Beginning balance	$	134,242,862	$	91,722,288
Provision for credit losses	85,822,267		30,265,811
Charge-offs	(69,266,382)		(30,016,940)
Recoveries	4,851,932		5,881,471
Net charge-offs	(64,414,450)		(24,135,469)
Ending Balance	$	155,650,679	$	97,852,630

The following table is an aging analysis on a recency basis at amortized cost of the Company’s gross loans receivable at June 30, 2022:

			Days Past Due - Recency Basis
Customer Tenure	Current		30 - 60		61 - 90		Over 90		Total Past Due		Total Loans
0 to 5 months	$	143,084,343	$	15,907,803	$	12,504,383	$	23,431,392	$	51,843,578	$	194,927,921
6 to 17 months	137,040,443		9,758,308		5,998,785		8,050,774		23,807,867		160,848,310
18 to 35 months	182,898,847		9,755,307		5,922,501		8,559,788		24,237,596		207,136,443
36 to 59 months	220,257,779		8,644,497		4,897,553		6,166,940		19,708,990		239,966,769
60+ months	775,200,859		26,383,162		14,764,901		19,398,244		60,546,307		835,747,166
Tax advance loans	144,499		175,713		381,605		2,469,303		3,026,621		3,171,120
Total gross loans	1,458,626,770		70,624,790		44,469,728		68,076,441		183,170,959		1,641,797,729
Unearned interest, insurance and fees	(397,387,228)		(19,240,967)		(12,115,302)		(18,546,697)		(49,902,966)		(447,290,194)
Total net loans	$	1,061,239,542	$	51,383,823	$	32,354,426	$	49,529,744	$	133,267,993	$	1,194,507,535
Percentage of period-end gross loans receivable			4.3%		2.7%		4.1%		11.2%

The following table is an aging analysis on a recency basis at amortized cost of the Company’s gross loans receivable at March 31, 2022:

			Days Past Due - Recency Basis
Customer Tenure	Current		30 - 60			61 - 90			Over 90			Total Past Due			Total Loans
0 to 5 months	$	145,168,588	$	13,450,365		$	14,196,717		$	25,924,805		$	53,571,887		$	198,740,475
6 to 17 months	116,065,794		5,548,699			4,148,743			7,902,330			17,599,772			133,665,566
18 to 35 months	183,697,553		7,220,814			4,903,686			9,118,270			21,242,770			204,940,323
36 to 59 months	193,820,229		5,951,049			3,452,087			5,712,662			15,115,798			208,936,027
60+ months	720,695,865		19,739,361			11,145,251			19,102,672			49,987,284			770,683,149
Tax advance loans	4,744,774		1,062,145			432			15,969			1,078,546			5,823,320
Total gross loans	1,364,192,803		52,972,433			37,846,916			67,776,708			158,596,057			1,522,788,860
Unearned interest, insurance and fees	(361,055,818)		(14,020,016)			(10,016,802)			(17,938,208)			(41,975,027)			(403,030,844)
Total net loans	$	1,003,136,985	$	38,952,417		$	27,830,114		$	49,838,500		$	116,621,030		$	1,119,758,016
Percentage of period-end gross loans receivable			3.5		%	2.5		%	4.5		%	10.4		%

The following table is an aging analysis on a contractual basis at amortized cost of the Company’s gross loans receivable at June 30, 2022:

			Days Past Due - Contractual Basis
Customer Tenure	Current		30 - 60		61 - 90		Over 90		Total Past Due			Total Loans
0 to 5 months	$	139,507,422	$	15,920,649	$	12,753,751	$	26,746,100	$	55,420,500		$	194,927,922
6 to 17 months	133,975,451		10,120,935		6,399,550		10,352,373		26,872,858			160,848,309
18 to 35 months	178,328,952		10,199,963		6,477,905		12,129,623		28,807,491			207,136,443
36 to 59 months	216,027,695		9,314,977		5,582,306		9,041,792		23,939,075			239,966,770
60+ months	760,120,257		29,222,922		17,196,451		29,207,535		75,626,908			835,747,165
Tax advance loans	108,806		179,187		398,880		2,484,247		3,062,314			3,171,120
Total gross loans	1,428,068,583		74,958,633		48,808,843		89,961,670		213,729,146			1,641,797,729
Unearned interest, insurance and fees	(389,061,979)		(20,421,676)		(13,297,446)		(24,509,093)		(58,228,215)			(447,290,194)
Total net loans	$	1,039,006,604	$	54,536,957	$	35,511,397	$	65,452,577	$	155,500,931		$	1,194,507,535
Percentage of period-end gross loans receivable			4.6%		3.0%		5.5%		13.1		%

The following table is an aging analysis on a contractual basis at amortized cost of the Company’s gross loans receivable at March 31, 2022:

			Days Past Due - Contractual Basis
Customer Tenure	Current		30 - 60			61 - 90			Over 90			Total Past Due			Total Loans
0 to 5 months	$	140,570,461	$	14,090,712		$	15,380,836		$	28,698,466		$	58,170,014		$	198,740,475
6 to 17 months	112,465,841		6,032,347			4,922,939			10,244,439			21,199,725			133,665,566
18 to 35 months	177,565,328		8,067,815			6,273,351			13,033,829			27,374,995			204,940,323
36 to 59 months	188,849,569		6,994,891			4,624,136			8,467,431			20,086,458			208,936,027
60+ months	702,984,756		23,645,619			15,443,941			28,608,833			67,698,393			770,683,149
Tax advance loans	4,737,742		1,060,329			—			25,249			1,085,578			5,823,320
Total gross loans	1,327,173,697		59,891,713			46,645,203			89,078,247			195,615,163			1,522,788,860
Unearned interest, insurance and fees	(351,258,109)		(15,851,316)			(12,345,412)			(23,576,007)			(51,772,735)			(403,030,844)
Total net loans	$	975,915,588	$	44,040,397		$	34,299,791		$	65,502,240		$	143,842,428		$	1,119,758,016
Percentage of period-end gross loans receivable			3.9		%	3.1		%	5.8		%	12.8		%

The Company elected not to record an allowance for credit losses for accrued interest as outlined in ASC 326-20-30-5A. Loans are placed on nonaccrual status when management determines that the full payment of principal and collection of interest according to contractual terms is no longer likely. The accrual of interest is discontinued when a loan is 61 days or more past the contractual due date. When the interest accrual is discontinued, all unpaid accrued interest is reversed against interest income. While a loan is on nonaccrual status, interest revenue is recognized only when a payment is received. Once a loan moves to nonaccrual status, it remains in nonaccrual status until it is paid out, charged off or refinanced. During the three months ended June 30, 2022 and June 30, 2021, the Company reversed a total of $9.0 million and $3.8 million, respectively, of unpaid accrued interest against interest income.

The following table presents the amortized cost basis of loans on nonaccrual status as of the beginning of the reporting period and the end of the reporting period, as well as year-to-date interest income recognized on nonaccrual loans for the three months ended June 30, 2022 and 2021:

	Nonaccrual Financial Assets
Customer Tenure	As of June 30, 2022		As of March 31, 2022		Interest Income Recognized for the three months ended June 30, 2022		Interest Income Recognized for the three months ended June 30, 2021
0 to 5 months	$	40,223,724	$	45,227,510	$	503,963	$	337,672
6 to 17 months	17,154,130		15,879,250		378,450		517,569
18 to 35 months	19,428,243		20,745,106		628,781		528,420
36 to 59 months	15,322,030		14,232,388		503,362		383,805
60+ months	48,873,080		47,565,819		1,658,281		1,508,141
Tax advance loans	2,887,237		25,249		—		—
Unearned interest, insurance and fees	(39,200,864)		(38,026,011)
Total	$	104,687,580	$	105,649,311	$	3,672,837	$	3,275,607

As of June 30, 2022 and March 31, 2022, there were no financial assets 61 days or more past due, not on nonaccrual status, and no financial assets with no related allowance for credit losses.