Finance Receivables, Net (Tables)

9 Months Ended

Sep. 30, 2023

Finance receivables, net, which include retail installment sales agreements and bank-originated installment loans, consist of the following (in thousands):


	As of September 30,				As of December 31,
	2023		2022		2022
Finance receivables, gross	$	224,618	$	188,897	$	195,987
Fair value premium on non-purchase credit deteriorated (”PCD”) finance receivables (1)	—		6,839		—

Merchant partner discounts and premiums, net	(9,730)		(2,044)		(3,517)
Unearned origination fees	(4,897)		(3,334)		(4,143)
Finance receivables, amortized cost	209,991		190,358		188,327
Less allowance for loan losses	(96,684)		(78,413)		(84,833)
Finance receivables, net	$	113,307	$	111,945	$	103,494

(1)Represents the difference between the initial fair value and the unpaid principal balance as of the date of the AFF acquisition, which is recognized through interest income on an effective yield basis over the lives of the related non-PCD finance receivables.

Schedule of Allowance for Credit Losses

The following table details the changes in the allowance for loan losses (in thousands):


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2023		2022		2023		2022
Balance at beginning of period	$	93,054	$	73,936	$	84,833	$	75,574
Provision for loan losses	33,096		31,956		90,571		83,453

Charge-offs	(30,890)		(28,642)		(83,281)		(84,629)
Recoveries	1,424		1,163		4,561		4,015
Balance at end of period	$	96,684	$	78,413	$	96,684	$	78,413

Schedule of Finance Receivables Credit Quality Indicators

The following is an assessment of the credit quality indicators of the amortized cost of finance receivables as of September 30, 2023 and 2022, by origination year (in thousands):


	Origination Year
	2023		2022		2021		Total
As of September 30, 2023
Delinquency:
1 to 30 days past due	$	14,764	$	4,150	$	179	$	19,093
31 to 60 days past due	9,036		2,792		148		11,976
61 to 89 days past due (1)	7,109		2,816		173		10,098
Total past due finance receivables	30,909		9,758		500		41,167
Current finance receivables	136,555		31,222		1,047		168,824
Finance receivables, amortized cost	$	167,464	$	40,980	$	1,547	$	209,991


	Origination Year
	2022		2021		2020		Total
As of September 30, 2022
Delinquency:
1 to 30 days past due	$	11,149	$	4,468	$	150	$	15,767
31 to 60 days past due	7,118		3,233		100		10,451
61 to 89 days past due (1)	5,971		3,292		120		9,383
Total past due finance receivables before fair value adjustments	24,238		10,993		370		35,601
Current finance receivables before fair value adjustments	111,023		35,969		926		147,918
Finance receivables before fair value adjustments	$	135,261	$	46,962	$	1,296	183,519
Fair value premium on non-PCD finance receivables							6,839
Finance receivables, amortized cost							$	190,358

(1)The Company charges off finance receivables when a receivable is 90 days or more contractually past due.

Finance Receivable, Charge-offs to allowance for credit losses

The following table details the gross charge-offs of finance receivables for the nine months ended September 30, 2023, by origination year (in thousands):


	Origination Year
	2023		2022		2021		Total
Finance receivables gross charge-offs:
Gross charge-offs during the nine months ended September 30, 2023	$	24,676	$	51,150	$	7,455	$	83,281