Highway budget – I69 Texas http://i69texas.org/ Tue, 09 Aug 2022 21:21:09 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://i69texas.org/wp-content/uploads/2021/08/icon-3-150x150.png Highway budget – I69 Texas http://i69texas.org/ 32 32 ELEVATE CREDIT, INC. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Form 10-Q) https://i69texas.org/elevate-credit-inc-managements-discussion-and-analysis-of-financial-condition-and-results-of-operations-form-10-q/ Tue, 09 Aug 2022 21:21:09 +0000 https://i69texas.org/elevate-credit-inc-managements-discussion-and-analysis-of-financial-condition-and-results-of-operations-form-10-q/ The following Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is intended to help the reader understand our business, our results of operations and our financial condition. The MD&A is provided as a supplement to, and should be read in conjunction with our unaudited condensed consolidated financial statements and the related […]]]>
The following Management's Discussion and Analysis of Financial Condition and
Results of Operations ("MD&A") is intended to help the reader understand our
business, our results of operations and our financial condition. The MD&A is
provided as a supplement to, and should be read in conjunction with our
unaudited condensed consolidated financial statements and the related notes and
other financial information included elsewhere in this Quarterly Report on Form
10-Q.

Some of the information contained in this discussion and analysis, including
information with respect to our plans and strategy for our business, includes
forward-looking statements that involve risks and uncertainties. You should
review the "Note About Forward-Looking Statements" section of this Quarterly
Report on Form 10-Q for a discussion of important factors that could cause
actual results to differ materially from the results described in or implied by
the forward-looking statements contained in the following discussion and
analysis. We generally refer to loans, customers and other information and data
associated with each of our brands (Rise, Elastic and Today Card) as Elevate's
loans, customers, information and data, irrespective of whether Elevate directly
originates the credit to the customer or whether such credit is originated by a
third party.

OVERVIEW

We provide online credit solutions to consumers in the US who are not
well-served by traditional bank products and who are looking for better options
than payday loans, title loans, pawn and storefront installment loans. Non-prime
consumers now represent a larger market than prime consumers but are riskier to
underwrite and serve with traditional approaches. We're succeeding at it - and
doing it responsibly - with best-in-class advanced technology and proprietary
risk analytics honed by serving more than 2.7 million customers with $10.3
billion in credit. Our current online credit products, Rise, Elastic and Today
Card, reflect our mission to provide customers with access to competitively
priced credit and services while helping them build a brighter financial future
with credit building and financial wellness features. We call this mission "Good
Today, Better Tomorrow."

We earn revenues on the Rise installment loans, on the Rise and Elastic lines of
credit and on the Today Card credit card product. Our revenue primarily consists
of finance charges and line of credit fees. Finance charges are driven by our
average loan balances outstanding and by the average annual percentage rate
("APR") associated with those outstanding loan balances. We calculate our
average loan balances by taking a simple daily average of the ending loan
balances outstanding for each period. Line of credit fees are recognized when
they are assessed and recorded to revenue over the life of the loan. We present
certain key metrics and other information on a "combined" basis to reflect
information related to loans originated by us and by our bank partners that
license our brands, Republic Bank, FinWise Bank and Capital Community Bank
("CCB"), as well as loans originated by third-party lenders pursuant to CSO
programs, which loans originated through CSO programs are not recorded on our
balance sheet in accordance with US GAAP. See "-Key Financial and Operating
Metrics" and "-Non-GAAP Financial Measures."

We use our working capital and our credit facility with Victory Park Management,
LLC ("VPC" and the "VPC Facility") to fund the loans we directly make to our
Rise customers. The VPC Facility has a maximum total borrowing amount available
of $200 million at June 30, 2022.

We also license our Rise installment loan brand to two banks. FinWise Bank
originates Rise installment loans in 17 states. This bank initially provides all
of the funding, retains 4% of the balances of all of the loans originated and
sells the remaining 96% loan participation in those Rise installment loans to a
third-party SPV, EF SPV, Ltd. ("EF SPV"). These loan participation purchases are
funded through a separate financing facility (the "EF SPV Facility"), and
through cash flows from operations generated by EF SPV. The EF SPV Facility has
a maximum total borrowing amount available of $250 million. We do not own EF
SPV, but we have a credit default protection agreement with EF SPV whereby we
provide credit protection to the investors in EF SPV against Rise loan losses in
return for a credit premium. As the primary beneficiary, Elevate is required to
consolidate EF SPV as a variable interest entity ("VIE") under US GAAP and the
condensed consolidated financial statements include revenue, losses and loans
receivable related to the 96% of the Rise installment loans originated by
FinWise Bank and sold to EF SPV.



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Beginning in the third quarter of 2020, we also license our Rise installment
loan brand to an additional bank, CCB, which originates Rise installment loans
in three different states than FinWise Bank. Similar to the relationship with
FinWise Bank, CCB initially provides all of the funding, retains 5% of the
balances of all of the loans originated and sells the remaining 95% loan
participation in those Rise installment loans to a third-party SPV, EC SPV, Ltd.
("EC SPV"). These loan participation purchases are funded through a separate
financing facility (the "EC SPV Facility"), and through cash flows from
operations generated by EC SPV. The EC SPV Facility has a maximum total
borrowing amount available of $100 million. We do not own EC SPV, but we have a
credit default protection agreement with EC SPV whereby we provide credit
protection to the investors in EC SPV against Rise loan losses in return for a
credit premium. As the primary beneficiary, Elevate is required to consolidate
EC SPV as a VIE under US GAAP and the condensed consolidated financial
statements include revenue, losses and loans receivable related to the 95% of
the Rise installment loans originated by CCB and sold to EC SPV.

The Elastic line of credit product is originated by a third-party lender,
Republic Bank, which initially provides all of the funding for that product.
Republic Bank retains 10% of the balances of all loans originated and sells a
90% loan participation in the Elastic lines of credit. An SPV structure was
implemented such that the loan participations are sold by Republic Bank to
Elastic SPV, Ltd. ("Elastic SPV") and Elastic SPV receives its funding from VPC
in a separate financing facility (the "ESPV Facility"), which was finalized on
July 13, 2015. We do not own Elastic SPV, but we have a credit default
protection agreement with Elastic SPV whereby we provide credit protection to
the investors in Elastic SPV against Elastic loan losses in return for a credit
premium. Per the terms of this agreement, under US GAAP, we are the primary
beneficiary of Elastic SPV and are required to consolidate the financial results
of Elastic SPV as a VIE in our condensed consolidated financial statements. The
ESPV Facility has a maximum total borrowing amount available of $350 million at
June 30, 2022.

Today Card is a credit card product designed to meet the spending needs of
non-prime consumers by offering a prime customer experience. Today Card is
originated by CCB under the licensed MasterCard brand, and a 95% participation
interest in the credit card receivable is sold to us. These credit card
receivable purchases are funded through a separate financing facility (the "TSPV
Facility"), and through cash flows from operations generated by the Today Card
portfolio. The TSPV Facility has a maximum commitment amount of $50 million,
which may be increased up to $100 million. As the lowest APR product in our
portfolio, Today Card allows us to serve a broader spectrum of non-prime
Americans. The Today Card experienced significant growth in its portfolio size
despite the pandemic due to the success of our direct mail campaigns, the
primary marketing channel for acquiring new Today Card customers. We are
following a specific growth plan to grow the product while monitoring customer
responses and credit quality. Customer response to the Today Card has been
strong, as we continue to see high response rates, high customer engagement, and
positive customer satisfaction scores.

In January 2022, we collaborated with Central Pacific Bank ("CPB") to invest in
the launch of a new fintech company, Swell Financial, Inc. ("Swell"). The Swell
App includes several groundbreaking features to help customers automatically
control their spending, tackle debt, and invest in exclusive private market
opportunities with as little as $1 thousand. We will help CPB and Swell offer
the Swell Credit line of credit product with APRs between 8% and 24%. Our
current total investment carrying value in Swell, using equity method
accounting, is $5.1 million and we have a non-controlling interest in Swell.

Our management evaluates our financial performance and our future strategic objectives using key indicators based primarily on the following three themes:


•Revenue growth.   Key metrics related to revenue growth that we monitor by
product include the ending and average combined loan balances outstanding, the
effective APR of our product loan portfolios, the total dollar value of loans
originated, the number of new and former customer loans made, the ending number
of customer loans outstanding and the related customer acquisition costs ("CAC")
associated with each new customer loan made. We include CAC as a key metric when
analyzing revenue growth (rather than as a key metric within margin expansion).

•Stable credit quality.   We work with our bank partners that originate loans on
our platform to address the appropriate credit risk for the revenues earned.
Since the time they were managing our legacy US products, our management team
has maintained stable credit quality across the loan portfolio they were
managing. With the adoption of fair value for the loans receivable portfolio
effective January 1, 2022, the credit quality metrics we monitor include net
charge-offs as a percentage of revenues, change in fair value of loans
receivable as a percentage of revenues, the percentage of past due combined
loans receivable - principal and net principal charge-offs as a percentage of
average combined loans receivable-principal. Prior to our adoption of fair value
for the loans receivable portfolio effective January 1, 2022, our credit quality
metrics also included the combined loan loss reserve as a percentage of
outstanding combined loans and total provision for loan losses as a percentage
of revenues. Under fair value accounting, a specific loan loss reserve is no
longer required to be recognized as a credit loss estimate is a key assumption
used in measuring fair value. See "-Non-GAAP Financial Measures" for further
information.



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•Margin expansion.   We aim to manage our business to achieve a long-term
operating margin of 20%. In periods of significant loan portfolio growth, our
margins may become compressed due to the upfront costs associated with
marketing. Prior to our adoption of fair value for the loans receivable
portfolio, we incurred upfront credit provisioning expense associated with loan
portfolio growth. When applying fair value accounting, estimated credit loss is
a key assumption within the fair value assumptions used each quarter and
specific loan loss allowance is no longer required to be recognized. Long term,
we anticipate that our direct marketing costs primarily associated with new
customer acquisitions will be approximately 10% of revenues and our operating
expenses will decline to 20% of revenues. While our operating margins may exceed
20% in certain years, such as in 2020 when we incurred lower levels of direct
marketing expense and materially lower credit losses due to a lack of customer
demand for loans resulting from the effects of COVID-19, we do not expect our
operating margin to increase beyond that level over the long term, as we intend
to pass on any improvements over our targeted margins to our customers in the
form of lower APRs. We believe this is a critical component of our responsible
lending platform and over time will also help us continue to attract new
customers and retain existing customers.

Choice of fair value option


Prior to January 1, 2022, we carried our combined loans receivable portfolio at
amortized cost, net of an allowance for estimated loan losses inherent in the
combined loan portfolio. Effective January 1, 2022, we elected the fair value
option to account for all our combined loan portfolio in conjunction with our
early adoption of Measurement of Credit Losses on Financial Instruments ("ASU
2016-13") and the related amendments. We believe the election of the fair value
option better reflects the value of our portfolio and its future economic
performance as well as more closely aligns with our decision-making processes
that relies on unit economics that align with discounted cash flow methodologies
that are utilized in fair value accounting. Refer to   Note 1   in the Notes to
the Condensed Consolidated Financial Statements included in this report for
discussion of the election and its impact on our accounting policies.

In accordance with the transition guidance, on January 1, 2022, we released the
allowance for loan losses and measured the combined loans receivable at fair
value at adoption. The cumulative-effect adjustment, net of tax, was recognized
collectively as a net increase of $98.6 million to opening Retained earnings.

In comparing our current period results under the fair value option to prior
periods, it may be helpful to consider that loans receivable are carried at fair
value with changes in fair value of loans receivable recorded in the Condensed
Consolidated Statements of Operations. The fair value takes into consideration
expected lifetime losses of the loans receivable, whereas the prior method
incorporated only incurred losses recognized as an allowance for loan losses. As
such, changes in credit quality, amongst other significant assumptions,
typically have a more significant impact on the carrying value of the combined
loans receivable portfolio under the fair value option. See "-Non-GAAP Financial
Measures" for further information.

Impact of COVID-19


In 2020, we experienced a significant decline in the loan portfolio due to a
lack of customer demand for loans resulting from the effects of COVID-19 and
related government stimulus programs. These impacts resulted in a lower level of
direct marketing expense and materially lower credit losses during 2020 and
continuing into early 2021. Beginning in the second quarter of 2021, we
experienced a return of demand for the loan products that we, and the bank
originators we support, offer, resulting in significant growth in the loan
portfolio from that point. This significant loan portfolio growth resulted in
compressed margins in 2021 due to the upfront costs associated with marketing
and credit provisioning expense related to growing and "rebuilding" the loan
portfolio from the impacts of COVID-19. We continue to target loan portfolio
originations within our target Customer Acquisition Costs ("CACs") of $250-$300
and credit quality metrics of 45-55% of revenue which, when combined with our
expectation of continuing customer loan demand for our portfolio products, we
believe will allow us to return to our historical performance levels prior to
COVID-19 after initially resulting in earnings compression.

We have implemented a hybrid remote environment where employees may choose to
work primarily from the office or from home and gather collectively in the
office on a limited basis. We have sought to ensure our employees feel secure in
their jobs, have flexibility in their work location and have the resources they
need to stay safe and healthy. As a 100% online lending solutions provider, our
technology and underwriting platform has continued to serve our customers and
the bank originators that we support without any material interruption in
services.

We continue to monitor the continued impacts of COVID-19 on our business, loan
portfolio, customers and employees, and while uncertainty still exists, we
believe we are well-positioned to operate effectively through any future impacts
associated with COVID-19. We will continue assessing our minimum cash and
liquidity requirement, monitoring our debt covenant compliance and implementing
measures to ensure that our cash and liquidity position is maintained.



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Macroeconomic factors


During the second quarter of 2022, the broader market environment that had
persisted since the second half of 2021 began to soften. The substantial
inflation pressures that our economy continues to face has resulted in many
challenges, most notably in the form of rising interest rates, softening of
consumer demand, and increased labor costs. With the Federal Reserve
prioritizing its mandate of price stability, it continues to take actions to
reduce and stabilize inflation, increasing the potential recessionary risks
posted by such actions. The inflation rate during the second quarter of 2022 was
the highest in four decades. Our operations can be adversely impacted by
inflation, primarily from higher financing and labor costs. Additionally,
inflation can impact our customers' demand for additional debt and their ability
to pay back their existing loans, impacting our revenue and charge-off rate.

Although the current macroeconomic environment may have a significant adverse
impact on our business, and while uncertainty still exists, we continue to take
appropriate actions to operate effectively through the present economic
environment and expect to have a more cautious approach to portfolio growth
during the second half of 2022. We will continue assessing our minimum cash and
liquidity requirement, monitoring our debt covenant compliance and implementing
measures to ensure our cash and liquidity position is maintained through the
current economic cycle.

KEY FINANCIAL AND OPERATIONAL INDICATORS


As discussed above, we regularly monitor a number of metrics in order to measure
our current performance and project our future performance. These metrics aid us
in developing and refining our growth strategies and in making strategic
decisions.

Certain of our metrics are non-GAAP financial measures. We believe that such
metrics are useful in period-to-period comparisons of our core business.
However, non-GAAP financial measures are not an alternative to any measure of
financial performance calculated and presented in accordance with US GAAP. See
"-Non-GAAP Financial Measures" for a reconciliation of our non-GAAP measures to
US GAAP.

Revenues

                                                                         As of and for the three months          As of and for the six months ended
                                                                                 ended June 30,                               June 30,
Revenue metrics (dollars in thousands, except as noted)                      2022                 2021                 2022                 2021
Revenues                                                               $   117,606            $  84,540          $   241,850            $ 174,273
Period-over-period change in revenue                                            39    %             (28) %                39    %             (38) %
Ending combined loans receivable - principal(1)                        $   532,433            $ 399,320              532,433              399,320
Average combined loans receivable - principal(1)(2)                    $   510,214            $ 355,980              522,965              367,365
Total combined loans originated - principal                            $   245,151            $ 210,401          $   450,638              343,914
Average customer loan balance(3)                                       $     2,087            $   1,827                2,087                1,827
Number of new customer loans                                                25,710               38,986               45,013               52,876
Ending number of combined loans outstanding                                255,099              218,543              255,099              218,543
Customer acquisition costs                                             $       304            $     271                  312                  283
Effective APR of combined loan portfolio                                        91    %              94  %                92    %              95  %


_________

(1)Combined loans receivable is defined as loans owned by us and consolidated
VIEs plus loans originated and owned by third-party lenders pursuant to our CSO
programs. See "-Non-GAAP Financial Measures" for more information and for a
reconciliation of Combined loans receivable to Loans receivable, net, / Loans
receivable at fair value, the most directly comparable financial measures
calculated in accordance with US GAAP.
(2)Average combined loans receivable - principal is calculated using an average
of daily Combined loans receivable - principal balances.
(3)Average customer loan balance is an average of all three products and is
calculated for each product by dividing the ending Combined loans receivable -
principal by the number of loans outstanding at period end.

Revenues. Our revenue is made up of Rise finance fees, Rise CSO fees (which are fees we receive from customers who obtain a loan through the CSO program for credit services, including loan guarantee, which we provide), revenue earned from the Elastic line of credit, and finance charges and fee revenue from the Today Card credit card product. See “Components of Our Results of Operations – Revenues”.

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Ending and average combined loans receivable - principal.   We calculate the
average combined loans receivable - principal by taking a simple daily average
of the ending combined loans receivable - principal for each period. Key metrics
that drive the ending and average combined loans receivable - principal include
the amount of loans originated in a period and the average customer loan
balance. All loan balance metrics include only the 90% participation in the
related Elastic line of credit advances (we exclude the 10% held by Republic
Bank), the 96% participation in FinWise Bank originated Rise installment loans,
the 95% participation in CCB originated Rise installment loans and the 95%
participation in the CCB originated Today Card credit card receivables, but
include the full loan balances on CSO loans, which are not presented on our
Condensed Consolidated Balance Sheets.

Total combined loans originated - principal.  The amount of loans originated in
a period is driven primarily by loans to new customers as well as new loans to
prior customers, including refinancing of existing loans to customers in good
standing.

Average customer loan balance and effective APR of combined loan portfolio.
The average loan amount and its related APR are based on the product and the
underlying credit quality of the customer. Generally, better credit quality
customers are offered higher loan amounts at lower APRs. Additionally, new
customers have more potential risk of loss than prior or existing customers due
to lack of payment history and the potential for fraud. As a result, newer
customers typically will have lower loan amounts and higher APRs to compensate
for that additional risk of loss. The effective APR is calculated based on the
actual amount of finance charges generated from a customer loan divided by the
average outstanding balance for the loan and can be lower than the stated APR on
the loan due to waived finance charges and other reasons. For example, a Rise
customer may receive a $2,000 installment loan with a term of 24 months and a
stated rate of 130%. In this example, the customer's monthly installment loan
payment would be $236.72. As the customer can prepay the loan balance at any
time with no additional fees or early payment penalty, the customer pays the
loan in full in month eight. The customer's loan earns interest of $1,657.39
over the eight-month period and has an average outstanding balance of $1,912.37.
The effective APR for this loan is 130% over the eight-month period calculated
as follows:

($1,657.39 interest earned / $1,912.37 average outstanding balance) x 12 months per year = 130%

8 months


In addition, as an example for Elastic, if a customer makes a $2,500 draw on the
customer's line of credit and this draw required bi-weekly minimum payments of
5% (equivalent to 20 bi-weekly payments), and if all minimum payments are made,
the draw would earn finance charges of $1,125. The effective APR for the line of
credit in this example is 107% over the payment period and is calculated as
follows:

($1,125.00 fees earned / $1,369.05 average outstanding balance) x 26 fortnight periods per year = 107%

20 payments


The actual total revenue we realize on a loan portfolio is also impacted by the
amount of prepayments and charged-off customer loans in the portfolio. For a
single loan, on average, we typically expect to realize approximately 60% of the
revenues that we would otherwise realize if the loan were to fully amortize at
the stated APR. From the Rise example above, if we waived $350 of interest for
this customer, the effective APR for this loan would decrease to 103%. From the
Elastic example above, if we waived $125 of fees for this customer, the
effective APR for this loan would decrease to 95%.

Number of new customer loans.  We define a new customer loan as the first loan
or advance made to a customer for each of our products (so a customer receiving
a Rise installment loan and then at a later date taking their first cash advance
on an Elastic line of credit would be counted twice). The number of new customer
loans is subject to seasonal fluctuations. New customer acquisition is typically
slowest during the first six months of each calendar year, primarily in the
first quarter, compared to the latter half of the year, as our existing and
prospective customers usually receive tax refunds during this period and, thus,
have less of a need for loans from us. Further, many customers will use their
tax refunds to prepay all or a portion of their loan balance during this period,
so our overall loan portfolio typically decreases during the first quarter of
the calendar year. Overall loan portfolio growth and the number of new customer
loans tends to accelerate during the summer months (typically June and July), at
the beginning of the school year (typically late August to early September) and
during the winter holidays (typically late November to early December).

Customer acquisition costs.  A key expense metric we monitor related to loan
growth is our CAC. This metric is the amount of direct marketing costs incurred
during a period divided by the number of new customer loans originated during
that same period. New loans to former customers are not included in our
calculation of CAC (except to the extent they receive a loan through a different
product) as we believe we incur no material direct marketing costs to make
additional loans to a prior customer through the same product.



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The following tables summarize the evolution of customer loans by product for the quarters and six months ended June 30, 2022 and 2021.

                                                                    Three Months Ended June 30, 2022
                                                 Rise                    Elastic                 Today
                                                                        (Lines of
                                         (Installment Loans)             Credit)             (Credit Card)             Total
Beginning number of combined
loans outstanding                              118,076                    102,973                  35,566              256,615
New customer loans originated                   15,629                      6,309                   3,772               25,710
Former customer loans originated                17,034                        191                       -               17,225
Attrition                                      (35,657)                    (5,866)                 (2,928)             (44,451)
Ending number of combined loans
outstanding                                    115,082                    103,607                  36,410              255,099
Customer acquisition cost (in
dollars)                                $          307               $        404          $          127          $       304
Average customer loan balance (in
dollars)                                $        2,462               $      1,909          $        1,409          $     2,087



                                                                    Three Months Ended June 30, 2021
                                                 Rise                    Elastic                 Today
                                                                        (Lines of
                                         (Installment Loans)             Credit)             (Credit Card)             Total
Beginning number of combined
loans outstanding                               91,508                     90,021                  12,802              194,331
New customer loans originated                   27,704                      6,339                   4,943               38,986
Former customer loans originated                14,909                        132                       -               15,041
Attrition                                      (25,337)                    (4,214)                   (264)             (29,815)
Ending number of combined loans
outstanding                                    108,784                     92,278                  17,481              218,543
Customer acquisition cost (in
dollars)                                $          294               $        332          $           64          $       271
Average customer loan balance (in
dollars)                                $        2,122               $      1,599          $        1,199          $     1,827



                                                                     Six Months Ended June 30, 2022
                                              Rise                    Elastic                    Today
                                          (Installment
                                             Loans)              (Lines of Credit)           (Credit Card)             Total
Beginning number of combined
loans outstanding                             134,414                     110,628                  35,464              280,506
New customer loans originated                  27,776                      10,701                   6,536               45,013
Former customer loans originated               32,736                         327                       -               33,063
Attrition                                     (79,844)                    (18,049)                 (5,590)            (103,483)
Ending number of combined loans
outstanding                                   115,082                     103,607                  36,410              255,099
Customer acquisition cost               $         317          $              428          $          103          $       312


                                                                      Six Months Ended June 30, 2021
                                              Rise                    Elastic                    Today
                                          (Installment
                                             Loans)              (Lines of Credit)           (Credit Card)              Total
Beginning number of combined
loans outstanding                             103,940                     100,105                   10,803              214,848
New customer loans originated                  36,360                       9,191                    7,325               52,876
Former customer loans originated               27,765                         226                        -               27,991
Attrition                                     (59,281)                    (17,244)                    (647)             (77,172)
Ending number of combined loans
outstanding                                   108,784                      92,278                   17,481              218,543
Customer acquisition cost               $         302          $              376          $            70          $       283






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Recent trends.  Our revenues for the three months ended June 30, 2022 totaled
$117.6 million, an increase of 39% versus the three months ended June 30, 2021.
Similarly, our revenues for the six months ended June 30, 2022 totaled $241.9
million, up 39% versus the prior year. The increase in quarterly and
year-to-date revenue is primarily attributable to higher average combined loans
receivable-principal as we saw growth in all of our products in the second
quarter of 2022. Rise, Elastic, and the Today products experienced
year-over-year increases in revenues for the six months ended June 30, 2022 of
36%, 34%, and 227%, respectively, which were attributable to increases in
year-over-year average loan balances as we focused on growing the portfolios
beginning in the second half of 2021. The Today Card also benefits from the
nature of the product, which provides an added convenience of having a credit
card for online purchases of day-to-day items such as groceries or clothing
(whereas the primary usage of a Rise installment loan or Elastic line of credit
is for emergency financial needs such as a medical deductible or automobile
repair).

We and the bank originators experienced a decrease in new customers due to our
more measured approach to growth based on our expectation of the impact of
inflation on our customers during the second quarter of 2022 versus the prior
year period. All three of our products experienced an increase in principal loan
balances in the second quarter of 2022 compared to a year ago. Rise and Elastic
principal loan balances at June 30, 2022 totaled $283.4 million and $197.8
million, respectively, up roughly $52.5 million and $50.2 million, respectively,
from a year ago. Today Card principal loan balances at June 30, 2022 totaled
$51.3 million, up $30.3 million from a year ago.

Our CAC was higher in the second quarter of 2022 at $304 as compared to the
second quarter of 2021 at $271 and slightly higher than our targeted range of
$250-$300 due to our measured approach to growth beginning in the second
quarter. The new customer loan volume is being sourced from all our marketing
channels including direct mail, strategic partners and digital. Our measured
approach toward growth is across all marketing channels including our strategic
partners channel where we have improved our technology and risk capabilities to
interface with the strategic partners via our application programming interface
(APIs) that we developed within our new technology platform ("Blueprint").
Blueprint will allow us to more efficiently acquire new customers within our
targeted CAC range. We believe our CAC in future quarters, and on an annual
basis, will be within or slightly above our target range of $250 to $300 as we
continue to take a more cautious approach to growth during the second half of
the year as we monitor the macroeconomic environment closely. Long term, we
would expect to return to our target range of $250 to $300 as we optimize the
efficiency of our marketing channels and continue to grow the Today Card which
successfully generates new customers at a sub-$100 CAC.

Credit quality


                                               As of and for the three 

months ended June 30thFrom and for the six months ended June 30thCredit quality measures (in thousands of dollars), after adopting fair value

             2022               2021 (Pro-forma)(6)              2022               2021 (Pro-forma)(6)
Net charge-offs(1)                             $     65,050            $           26,063          $    141,869            $           56,953
Net change in fair value(1)(6)                       (3,594)                       (6,619)                3,746                        (1,952)
Total change in fair value of loans
receivable (6)                                 $     61,456            $           19,444          $    145,615            $           55,001

Net charge-offs as a percentage of
revenues (1)                                             55    %                       31  %                 59    %                       33  %
Total change in fair value of loans
receivable as a percentage of
revenues(6)                                              52    %                       23  %                 60    %                       32  %
Percentage past due                                      10    %                        7  %                 10    %                        7  %
Fair value premium(6)                                    10    %                       13  %                 10    %                       13  %





                                       46
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                                                          As of and for the three months          As of and for the six months
                                                                  ended June 30,                         ended June 30,
Credit quality metrics (dollars in
thousands), before adoption of fair value                              2021                                   2021
Net charge-offs(2)                                       $                   26,063              $                56,953
Additional provision for loan losses(2)                                       1,162                               (8,758)
Provision for loan losses                                $                   27,225              $                48,195

Net charge-offs as a percentage of
revenues(2)                                                                      31      %                            33      %
Total provision for loan losses as a
percentage of revenues                                                           32      %                            28      %
Percentage past due                                                               7      %                             7      %
Combined loan loss reserve(4)                            $                   40,321              $                40,321
Combined loan loss reserve as a percentage
of combined loans receivable(3)(4)(5)                                            10      %                            10      %


_________

(1)Net charge-offs and net change in fair value of loans receivable are not
financial measures prepared in accordance with US GAAP. Net charge-offs include
the amount of principal and accrued interest on loans that are more than 60 days
past due (Rise and Elastic) or 120 days past due (Today Card), or sooner if we
receive notice that the loan will not be collected, such as a bankruptcy notice
or identified fraud, offset by any recoveries. Net change in fair value reflects
the adjustment recognized related to the change in the fair value mark during
the reported period. See "-Non-GAAP Financial Measures" for more information and
for a reconciliation to Change in fair value of loans receivable, the most
directly comparable financial measure calculated in accordance with US GAAP.
(2)Net charge-offs and additional provision for loan losses are not financial
measures prepared in accordance with US GAAP. Net charge-offs include the amount
of principal and accrued interest on loans that are more than 60 days past due
(Rise and Elastic) or 120 days past due (Today Card), or sooner if we receive
notice that the loan will not be collected, such as a bankruptcy notice or
identified fraud, offset by any recoveries. Additional provision for loan losses
is the amount of provision for loan losses needed for a particular period to
adjust the combined loan loss reserve to the appropriate level in accordance
with our underlying loan loss reserve methodology. See "-Non-GAAP Financial
Measures" for more information and for a reconciliation to Provision for loan
losses, the most directly comparable financial measure calculated in accordance
with US GAAP.
(3)Combined loans receivable is defined as loans owned by us and consolidated
VIEs plus loans originated and owned by third-party lenders pursuant to our CSO
programs. See "-Non-GAAP Financial Measures" for more information and for a
reconciliation of Combined loans receivable to Loans receivable, net, the most
directly comparable financial measure calculated in accordance with US GAAP.
(4)Combined loan loss reserve is defined as the loan loss reserve for loans
originated and owned by us and consolidated VIEs plus the loan loss reserve for
loans owned by third-party lenders and guaranteed by us. See "-Non-GAAP
Financial Measures" for more information and for a reconciliation of Combined
loan loss reserve to Allowance for loan losses, the most directly comparable
financial measure calculated in accordance with US GAAP.
(5)Combined loan loss reserve as a percentage of combined loans receivable is
determined using period-end balances.
(6)We have provided pro-forma information reflecting the adoption of fair value
in the 2021 financial period to provide comparability to the 2022 financial
period. See "-Non-GAAP Financial Measures" for more information and for a
reconciliation to previously reported amounts for 2021 calculated in accordance
with US GAAP. The pro-forma fair value adjustments reflect fair value
methodology acceptable with US GAAP.

Net principal charge-offs as a percentage of
average combined loans receivable - principal                First              Second               Third              Fourth
(1)(2)(3)                                                   Quarter             Quarter             Quarter             Quarter
2022                                                          11%                 10%                 N/A                 N/A
2021                                                          6%                  5%                  6%                  10%
2020                                                          11%                 10%                 4%                  5%


_________

(1)Net principal charge-offs is comprised of gross principal charge-offs less
recoveries.
(2)Average combined loans receivable - principal is calculated using an average
of daily Combined loans receivable - principal balances during each quarter.
(3)Combined loans receivable is defined as loans owned by us and consolidated
VIEs plus loans originated and owned by third-party lenders pursuant to our CSO
programs. See "-Non-GAAP Financial Measures" for more information and for a
reconciliation of Combined loans receivable to the most directly comparable
financial measure calculated in accordance with US GAAP.




                                       47
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Net principal charge-offs as a percentage of average combined loans
receivable-principal for the second quarter of 2022 is higher than the second
quarter of 2021 and consistent with this credit metric during 2019 and slightly
improved from the first quarter 2022. The above chart depicts the historically
low charge-off metrics from the third quarter of 2020 through the third quarter
of 2021, due to COVID-19 pandemic impacts such as a lack of new customer demand,
our implementation of payment assistance tools, and government stimulus payments
received by our customers. Beginning in the fourth quarter of 2021, net
principal charge-offs as a percentage of average combined loans
receivable-principal have returned to the levels consistent with 2019 due to the
increased volume of new customers being originated as we rebuilt the loan
portfolio from the impacts of the COVID-19 pandemic in the second half of 2021
and return to a more normalized credit profile.

Upon adoption of fair value for the combined loans receivable portfolio on
January 1, 2022, in reviewing the credit quality of our loan portfolio, we break
out our total change in fair value in loans receivable that is presented on our
Condensed Combined Statement of Operations under US GAAP into two separate
items-net charge-offs and net change in fair value. Net charge-offs are
indicative of the credit quality of our underlying portfolio, while net change
in fair value is subject to more fluctuation based on loan portfolio growth and
changes in assumptions used in the fair value methodology. The net change in
fair value is the change in the reporting period between the current period fair
value mark as compared to the beginning of period fair value mark. With all
other assumptions held flat and a fair value premium associated with the
combined loan portfolio, we would expect the net change in fair value to be
positive in periods of growth in the loan portfolio and expect the net change in
fair value to be negative in periods of attrition in the loan portfolio.

Net charge-offs. Net charge-offs comprise gross charge-offs offset by recoveries
on prior charge-offs. Gross charge-offs include the amount of principal and
accrued interest on loans that are more than 60 days past due (Rise and Elastic)
or 120 days (Today Card), or sooner if we receive notice that the loan will not
be collected, such as a bankruptcy notice or identified fraud. Any payments
received on loans that have been charged off are recorded as recoveries and
reduce the total amount of gross charge-offs. Recoveries are typically less than
10% of the amount charged off, and thus, we do not view recoveries as a key
credit quality metric.

Net charge-offs as a percentage of revenues can vary based on several factors,
such as whether or not we experience significant growth or lower the APR of our
products. Additionally, although a more seasoned portfolio will typically result
in lower net charge-offs as a percentage of revenues, we do not intend to drive
down this ratio significantly below our historical ratios and would instead seek
to offer our existing products to a broader new customer base to drive
additional revenues.

Net charge-offs as a percentage of average combined loans receivable-principal
allow us to determine credit quality and evaluate loss experience trends across
our loan portfolio.

Net change in fair value. Beginning January 1, 2022, we utilize the fair value
option on the combined loans receivable portfolio. As such, loans receivables
are carried at fair value in the Condensed Consolidated Balance Sheets with
changes in fair value recorded in the Condensed Consolidated Statements of
Operations. To derive the fair value, we generally utilize discounted cash flow
analyses that factor in estimated losses and prepayments over the estimated
duration of the underlying assets. Loss and prepayment assumptions are
determined using historical loss data and include appropriate consideration of
recent trends and anticipated future performance. Hence, another key credit
quality metric we monitor is the percentage of past due combined loans
receivable - principal, as an increase in past due loans is a consideration in
the credit loss assumption used in the fair value assumptions as a significant
increase in the percentage of past due loans may indicate a future increase in
credit loss in the portfolio. As such, changes in credit quality, amongst other
significant assumptions, typically have a more significant impact on the
carrying value of the combined loans receivable portfolio under the fair value
option. Future cash flows are discounted using a rate of return that we believe
a market participant would require. Accrued and unpaid interest and fees are
included in Loans receivable at fair value in the Condensed Consolidated Balance
Sheets.

Additional provision for loan losses.  For financial data prior to January 1,
2022, in reviewing the credit quality of our loan portfolio, we broke out our
total provision for loan losses that was presented on our statement of
operations under US GAAP into two separate items-net charge-offs (as discussed
above) and additional provision for loan losses. The additional provision for
loan losses is the amount needed to adjust the combined loan loss reserve to the
appropriate amount at the end of each month based on our loan loss reserve
methodology.



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Additional provision for loan losses relates to an increase in inherent losses
in the loan portfolio as determined by our loan loss reserve methodology. This
increase could be due to a combination of factors such as an increase in the
size of the loan portfolio or a worsening of credit quality or increase in past
due loans. It is also possible for the additional provision for loan losses for
a period to be a negative amount, which would reduce the amount of the combined
loan loss reserve needed (due to a decrease in the loan portfolio or improvement
in credit quality). The amount of additional provision for loan losses is
seasonal in nature, mirroring the seasonality of our new customer acquisition
and overall loan portfolio growth, as discussed above. The combined loan loss
reserve typically decreased during the first quarter or first half of the
calendar year due to a decrease in the loan portfolio from year end. Then, as
the rate of growth for the loan portfolio started to increase during the second
half of the year, additional provision for loan losses was typically needed to
increase the reserve for losses associated with the loan growth. Because of
this, our provision for loan losses varied significantly throughout the year
without a significant change in the credit quality of our portfolio.

Loan loss reserve methodology prior to January 1, 2022.  Our loan loss reserve
methodology was calculated separately for each product and, in the case of Rise
loans originated under the state lending model (including CSO program loans),
was calculated separately based on the state in which each customer resides to
account for varying state license requirements that affect the amount of the
loan offered, repayment terms and other factors. For each product, loss factors
were calculated based on the delinquency status of customer loan balances:
current, 1 to 30 days past due, 31 to 60 days past due or 61-120 past due (for
Today Card only). These loss factors for loans in each delinquency status were
based on average historical loss rates by product (or state) associated with
each of these three delinquency categories.

Recent trends.  Total change in fair value of loans receivable for the three and
six months ended June 30, 2022 were 52% and 60% of revenue, compared to the
pro-forma three and six months ended June 30, 2021 of 23% and 32%, respectively,
(See "-Non-GAAP Financial Measures" for more information and for a
reconciliation to previously reported amounts for 2021 calculated in accordance
with US GAAP.). Net charge-offs as a percentage of revenues for the three and
six months ended June 30, 2022 were 55% and 59%, compared to 31% and 33%,
respectively, in the prior year periods. The increase in net charge-offs as a
percentage of revenues is due to the growth in the loan portfolio during the
second half of 2021 and early 2022, which included a higher mix of new customers
that carry a higher overall loss rate. The portfolio returned to the upper end
of our targeted range of 45-55% of revenue as the portfolio matures with a mix
of new and returning customers. In the near term, we expect our portfolio to
perform at the upper end of our targeted range based on the current
macroeconomic factors being observed in the economy. We continue to monitor the
portfolio during the economic recovery resulting from COVID-19 and recent
macroeconomic factors and will adjust our underwriting and credit policies to
mitigate any potential negative impacts as needed. Long term, we would expect to
see the portfolio return to our targeted range of 45-55% of revenue.

Past due loan balances at June 30, 2022 were 10% of total combined loans
receivable-principal, up from 7% from a year ago, due to the number of new
customers originated beginning in the second quarter of 2021, which is
consistent with our historical past due percentages prior to the pandemic. We,
and the bank originators we support, continue to offer payment flexibility
programs, if certain qualifications are met, to assist borrowers during the
current economic environment. The population of customers utilizing the payment
flexibility programs has remained stable, and we continue to see that most
customers are meeting their scheduled payments once they exit the payment
flexibility program.

Net change in fair value as a percentage of revenue was (3)% and (8)% for the
three months ended June 30, 2022 and pro-forma June 30, 2021, respectively, and
2% and (1)% for the six months ended June 30, 2022 and pro-forma June 30, 2021,
respectively (See "-Non-GAAP Financial Measures" for more information and for a
reconciliation to previously reported amounts for 2021 calculated in accordance
with US GAAP.). The fair value premium of the combined loans
receivable-principal portfolio was 10% at June 30, 2022 compared to 13% at
June 30, 2021 due to the composition of the loan portfolio with an increased mix
of newly originated loans at June 30, 2022 as compared to a more mature loan
portfolio at June 30, 2021 due to limited origination activity and significant
paydowns experienced in the portfolio due to the effects of COVID-19. The key
assumptions used in the fair value estimate at June 30, 2022 are as follows:

                         June 30, 2022
Credit loss rate                  17  %
Prepayment rate                   27  %
Discount rate                     21  %






                                       49
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Total loan loss provision for the three months and six months ended June 30,
2021, prior to the adoption of fair value, were 32% and 28% of revenues,
respectively, which were below our targeted range of approximately 45% to 55%.
Net charge-offs as a percentage of revenues for the three months and six months
ended June 30, 2021 were 31% and 33%, respectively, due to reduced demand and
limited loan origination activity in 2020 and early 2021 coupled with customers'
receipt of monetary stimulus provided by the US government which allowed
customers to continue making payments on their loans.

The combined loan loss reserve as a percentage of combined loans receivable
totaled 10% as of June 30, 2021. The lower historical combined loan loss reserve
rate reflects the strong credit performance of the portfolio at June 30, 2021
due to the mature nature of the portfolio resulting from limited new loan
origination activity in 2020 and early 2021.

We also look at Rise and Elastic principal loan charge-offs (including both
credit and fraud losses) by loan vintage as a percentage of combined loans
originated-principal. As the below table shows, our cumulative principal loan
charge-offs for Rise and Elastic through June 30, 2022 for each annual vintage
since the 2013 vintage are generally under 30% and continue to generally trend
at or slightly below our 20% to 25% long-term targeted range. Our payment
deferral programs and monetary stimulus programs provided by the US government
in response to the COVID-19 pandemic have also assisted in reducing losses in
our 2019 and 2020 vintages coupled with a lower volume of new loan originations
in our 2020 vintage. We would expect the 2021 vintage to be at or near 2018
levels or slightly lower given the increased volume of new customer loans
originated during the second half of 2021. While still early, our 2022 vintage
appears to be performing consistently with our 2021 vintage. It is also possible
that the cumulative loss rates on all vintages will increase and may exceed our
recent historical cumulative loss experience due to the economic impact of the
current inflationary environment.

[[Image Removed: elvt-20220630_g2.jpg]]

_________

1) The 2021 and 2022 vintages are not yet fully ripe from the point of view of losses. 2) UK included in 2013 to 2017 vintages only.

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We also look at Today Card principal loan charge-offs (including both credit and
fraud losses) by account vintage as a percentage of account principal
originations. As the below table shows, our cumulative principal credit card
charge-offs through June 30, 2022 for the 2020 annual vintage is just over under
8%. As expected, the 2021 account vintage is experiencing losses higher than the
2020 account vintage due to the volume of new customers originated in the second
half of 2021 and the performance of certain segments upon the release of the
credit model during 2021. The Today Card requires accounts to be charged off
that are more than 120 days past due which results in a longer maturity period
for the cumulative loss curve related to this portfolio. Our 2018 and 2019
vintages are considered to be test vintages and were comprised of limited
originations volume and not reflective of our current underwriting standards.

[[Image Removed: elvt-20220630_g3.jpg]]





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Margins

                                                  Three Months Ended June 30,                   Six Months Ended June 30,
Margin metrics (dollars in thousands)              2022                   2021                  2022                   2021
Revenues                                    $      117,606           $    84,540          $     241,850           $   174,273
Net charge-offs(1)                                 (65,050)              (26,063)         $    (141,869)              (56,953)
Change in fair value(1)                              3,594                     -                 (3,746)                    -
Additional provision for loan
losses(1)                                                -                (1,162)                     -                 8,758
Direct marketing costs                              (7,828)             
(10,564)               (14,054)              (14,947)
Other cost of sales                                 (3,163)               (2,905)                (6,045)               (4,952)
Gross profit                                        45,159                43,846                 76,136               106,179
Operating expenses                                 (39,865)              (38,606)               (78,146)              (76,200)
Operating income (loss)                     $        5,294           $     

5,240 $(2,010) $29,979
As a percentage of income: net charges

                                         55   %                31  %                  59   %                33  %
Change in fair value                                    (3)                    -                      2                     -
Additional provision for loan losses                     -                     1                      -                    (5)
Direct marketing costs                                   7                    12                      6                     9
Other cost of sales                                      3                     3                      2                     3
Gross margin                                            38                    52                     31                    61
Operating expenses                                      34                    46                     32                    44
Operating margin                                         5   %                 6  %                  (1)  %                17  %


_________

(1) Non-GAAP measure. See “-Non-GAAP Financial Measures – Net Write-offs and Net Change in Fair Value” and “-Non-GAAP Financial Measures – Net Write-offs and Additional Allowance for Loan Losses”.


Gross margin is calculated as revenues minus cost of sales, or gross profit,
expressed as a percentage of revenues, and operating margin is calculated as
operating income expressed as a percentage of revenues. Due to the negative
impact of COVID-19 and the current economic environment on our loan balances and
revenue, we are monitoring our profit margins closely. Long term, we intend to
continue to manage the business to a targeted 20% operating margin.

Recent operating margin trends.  For the three months ended June 30, 2022, our
operating margin was 5%, which was a decrease from 6% in the prior year period,
as originally reported, and 15% on a pro-forma basis considering the pro-forma
adoption of fair value at the beginning of 2021 (See "-Non-GAAP Financial
Measures" for more information and for a reconciliation to previously reported
amounts for 2021 calculated in accordance with US GAAP.). For the six months
ended June 30, 2022, our operating margin was (1)%, which was also a decrease
from 17% in the prior year period, and 13% on a pro-forma basis considering the
pro-forma adoption of fair value at the beginning of 2021 (See "-Non-GAAP
Financial Measures" for more information and for a reconciliation to previously
reported amounts for 2021 calculated in accordance with US GAAP.). The
year-over-year margin decreases we are experiencing in 2022 are primarily driven
by the increased net charge-offs in the first half of 2022 due to a higher
volume of new customers originated in the loan portfolio during the second half
of 2021 and early 2022 as well as the macroeconomic environment. As the
portfolio matures and we manage the mix of new and returning customers to the
portfolio over the long term, we continue to see our net charge-offs as a
percentage of revenue return to our target range of 45-55% and would expect our
gross margin to normalize in future periods with our past historical
performance. The margins achieved in the first half of 2021 were primarily
driven by decreased revenue as a result of lower average combined loans
receivable-principle, lower effective APRs earned on the loan portfolio, and
increased direct marketing and origination expenses as we grew our loan
portfolio and acquired new customers. In the short term, we expect our expense
metrics to improve as we take a more cautious approach in executing our growth
strategy over the remainder of the year. In the long term, as we grow the loan
portfolio while actively managing our operating expenses, we expect to see our
operating expense metrics return to approximately 20% of revenue.



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NON-GAAP FINANCIAL MEASURES


We believe that the inclusion of the following non-GAAP financial measures in
this Quarterly Report on Form 10-Q can provide a useful measure for
period-to-period comparisons of our core business, provide transparency and
useful information to investors and others in understanding and evaluating our
operating results, and enable investors to better compare our operating
performance with the operating performance of our competitors. Management uses
these non-GAAP financial measures frequently in its decision-making because they
provide supplemental information that facilitates internal comparisons to the
historical operating performance of prior periods and give an additional
indication of our core operating performance. However, non-GAAP financial
measures are not a measure calculated in accordance with US generally accepted
accounting principles, or US GAAP, and should not be considered an alternative
to any measures of financial performance calculated and presented in accordance
with US GAAP. Other companies may calculate these non-GAAP financial measures
differently than we do.


Adjusted EBITDA and Adjusted EBITDA margin

Adjusted EBITDA represents our net income (loss) adjusted to exclude:

• Net interest expense primarily associated with notes payable under credit facilities used to fund loan portfolios;

•Remuneration in shares;

• Depreciation of fixed assets and intangible assets;

• Gains or losses from an investment using the equity method;

•Settlement related to a legal matter or to gains and losses on disposals included in non-operating income; and

•Income taxes.

Adjusted EBITDA margin is Adjusted EBITDA divided by revenue.


Management believes that Adjusted EBITDA and Adjusted EBITDA margin are useful
supplemental measures to assist management and investors in analyzing the
operating performance of the business and provide greater transparency into the
results of operations of our core business.

Adjusted EBITDA and Adjusted EBITDA margin should not be considered as
alternatives to net income (loss) or any other performance measure derived in
accordance with US GAAP. Our use of Adjusted EBITDA and Adjusted EBITDA margin
has limitations as an analytical tool, and you should not consider it in
isolation or as a substitute for analysis of our results as reported under US
GAAP. Some of these limitations are:

•Although depreciation and amortization are non-cash charges, the assets being
depreciated and amortized may have to be replaced in the future, and Adjusted
EBITDA does not reflect expected cash capital expenditure requirements for such
replacements or for new capital assets;

•Adjusted EBITDA does not reflect changes in or cash requirements for our working capital requirements; and


•Adjusted EBITDA does not reflect interest associated with notes payable used
for funding the loan portfolios, for other corporate purposes or tax payments
that may represent a reduction in cash available to us.



                                       53
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The following table provides a reconciliation of net earnings (loss) to Adjusted EBITDA and Adjusted EBITDA margin for each of the periods indicated:


                                                Three Months Ended June 30,                      Six Months Ended June 30,
(Dollars in thousands)                          2022                   2021                   2022                        2021
Net income (loss)                         $      (6,545)          $     (3,045)         $     (20,468)               $     9,671
Adjustments:
Net interest expense                             12,126                  8,567                 24,296                     17,353
Share-based compensation                          2,280                  1,787                  3,938                      3,389

Depreciation and amortization                     4,720                  4,552                  8,481                      9,795

Equity method investment loss                       368                      -                    712                          -
Non-operating income                                (81)                  (510)                (1,747)                      (717)
Income tax expense (benefit)                       (574)                   228                 (4,803)                     3,672
Adjusted EBITDA                           $      12,294           $     11,579          $      10,409                $    43,163

Adjusted EBITDA margin                             10.5   %               13.7  %                 4.3   %                   24.8  %


Unaudited pro forma condensed consolidated financial information


The following unaudited pro-forma condensed consolidated statement of operations
information reflects the adoption of ASU 2016-13 as of January 1, 2021.
Management has made significant estimates and assumptions in its determination
of the pro-forma accounting adjustments based on certain currently available
information and certain assumptions and methodologies that we believe are
reasonable and consistent with US GAAP. Management believes the pro-forma
financial information is a useful supplemental measure to assist management and
investors in analyzing the operating performance of the business and provide
greater transparency into the results of operations of our core business.



                                       54
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                                                        Three Months Ended June 30, 2021                                        Six Months Ended June 30, 2021
                                                                                                                                                                 Pro-forma
                                                                 Fair value           Pro-forma financial                                Fair value              financial
(Dollars in thousands)                   As reported             adjustments              information             As reported           adjustments             information
Revenues                               $     84,540           $            -          $      84,540             $    174,273          $           -          $    174,273
Cost of sales:
Provision for loan losses                    27,225                  (27,225)                     -                   48,195                (48,195)                    -
Change in fair value of loans
receivable                                        -                   19,444                 19,444                        -                 55,001                55,001
Direct marketing and other costs
of sales                                     13,469                        -                 13,469                   19,899                      -                19,899
Total costs of sales                         40,694                   (7,781)                32,913                   68,094                  6,806                74,900
Gross profit                                 43,846                    7,781                 51,627                  106,179                 (6,806)               99,373
Total operating expenses                     38,606                        -                 38,606                   76,200                      -                76,200
Operating income                              5,240                    7,781                 13,021                   29,979                 (6,806)               23,173
                                                                                                  -
Total other expense                          (8,057)                       -                 (8,057)                 (16,636)                     -               (16,636)
Income before taxes                          (2,817)                   7,781                  4,964                   13,343                 (6,806)                6,537
Income tax expense                              228                    1,286                  1,514                    3,672                 (1,654)                2,018
Net income (loss)                      $     (3,045)          $        6,495          $       3,450             $      9,671          $      (5,152)         $      4,519

Basic earnings (loss) per share        $      (0.09)          $         0.19          $        0.10             $       0.27          $       (0.14)         $       0.13
Diluted earnings (loss) per
share                                  $      (0.09)          $         0.19          $        0.10             $       0.27          $       (0.15)         $       0.12

Basic weighted average shares
outstanding                              35,132,980                        -             35,132,980               35,591,583                      -            35,591,583
Diluted weighted average shares
outstanding (1)                          35,132,980                  568,397             35,701,377               36,331,631                      -            36,331,631

Adjusted EBITDA                        $     11,579           $        7,781          $      19,360             $     43,163          $      (6,806)         $     36,357
Adjusted EBITDA margin                         13.7   %                                        22.9     %               24.8  %                                      20.9     %


_________
(1)Represents potentially dilutive shares that were anti-dilutive in the
Company's quarter-ended June 30, 2021 diluted weighted average shares
outstanding as the Company was in a net loss position. The pro-forma adjustments
result in net income for the period and therefore result in inclusion of the
anti-dilutive shares.



                                       55
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Free movement of capital

Free cash flow (“FCF”) represents our net cash provided by operating activities, adjusted to include:

• Net write-offs – capital loans combined; and

• Capital expenditures.

The following table presents a reconciliation of the net cash provided by operating activities to the FCF for each of the periods indicated:

                                                        Six Months Ended June 30,
(Dollars in thousands)                                      2022                 2021

Net cash provided by operating activities(1)      $       86,228              $ 66,687
Adjustments:
Net charge-offs - combined principal loans              (110,135)              (41,745)
Capital expenditures                                     (11,567)               (7,563)
FCF(2)                                            $      (35,474)             $ 17,379


 _________

(1)Net cash provided by operating activities includes net charge-offs - combined
finance charges.
(2)FCF includes $17.2 million in cash payments associated with legal settlements
for the six months ended June 30, 2022.

Net charges and net change in fair value


We break out our total change in fair value into two separate items-first, the
amount related to net charge-offs, and second, net change in fair value needed
to adjust the current period fair value mark from the fair value mark from the
beginning of the reporting period. We believe this presentation provides more
detail related to the components of our total change in fair value when
analyzing the gross margin of our business.

Net charge-offs.  Net charge-offs comprise gross charge-offs offset by
recoveries on prior charge-offs. Gross charge-offs include the amount of
principal and accrued interest on loans that are more than 60 days past due
(Rise and Elastic) or 120 days (Today Card), or sooner if we receive notice that
the loan will not be collected, such as a bankruptcy notice or identified fraud.
Any payments received on loans that have been charged off are recorded as
recoveries and reduce total gross charge-offs.

Net change in fair value.  The net change in fair value is the change in the
reporting period between the current period fair value mark as compared to the
beginning of period fair value mark. With all other assumptions held flat and
fair value premium associated with the combined loan portfolio, we would expect
the net change in fair value to be positive in periods of growth in the loan
portfolio and expect the net change in fair value to be negative in periods of
attrition in the loan portfolio.

                                                            Three Months Ended June 30,                            Six Months Ended June 30,
(Dollars in thousands)                                  2022                2021 (pro-forma)(1)               2022                2021 (pro-forma)(1)

Net charge-offs                                   $       65,050          $             26,063          $      141,869          $             56,953
Net change in fair value                                  (3,594)                       (6,619)                  3,746                        (1,952)
Total change in fair value of loans
receivable                                        $       61,456          $             19,444          $      145,615          $             55,001


 _________
(1)We have provided pro-forma information reflecting the adoption of fair value
in the 2021 financial period to provide comparability to the 2022 financial
period. See "-Non-GAAP Financial Measures" for more information and for a
reconciliation to previously reported amounts for 2021 calculated in accordance
with US GAAP. The pro-forma fair value adjustments reflect fair value
methodology acceptable with US GAAP.




                                       56
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Net write-offs and additional provision for loan losses


We break out our total provision for loan losses into two separate items-first,
the amount related to net charge-offs, and second, the additional provision for
loan losses needed to adjust the combined loan loss reserve to the appropriate
amount at the end of each month based on our loan loss provision methodology. We
believe this presentation provides more detail related to the components of our
total provision for loan losses when analyzing the gross margin of our business.

Net charge-offs.  Net charge-offs comprise gross charge-offs offset by
recoveries on prior charge-offs. Gross charge-offs include the amount of
principal and accrued interest on loans that are more than 60 days past due
(Rise and Elastic) or 120 days (Today Card), or sooner if we receive notice that
the loan will not be collected, such as a bankruptcy notice or identified fraud.
Any payments received on loans that have been charged off are recorded as
recoveries and reduce total gross charge-offs.

Additional provision for loan losses.  Additional provision for loan losses is
the amount of provision for loan losses needed for a particular period to adjust
the combined loan loss reserve to the appropriate level in accordance with our
underlying loan loss reserve methodology.

                                                       Three Months Ended June 30,                 Six Months Ended June 30,
(Dollars in thousands)                                            2021                                       2021

Net charge-offs                                      $                     26,063                $                   56,953
Additional provision for loan losses                                        1,162                                    (8,758)
Provision for loan losses                            $                     27,225                $                   48,195


Combined loan information

The Elastic line of credit product is originated by a third-party lender,
Republic Bank, which initially provides all of the funding for that product.
Republic Bank retains 10% of the balances of all of the loans originated and
sells a 90% loan participation in the Elastic lines of credit to a third-party
SPV, Elastic SPV, Ltd. Elevate is required to consolidate Elastic SPV, Ltd. as a
VIE under US GAAP and the condensed consolidated financial statements include
revenue, losses and loans receivable related to the 90% of Elastic lines of
credit originated by Republic Bank and sold to Elastic SPV.

Beginning in the fourth quarter of 2018, we started licensing our Rise
installment loan brand to a third-party lender, FinWise Bank, which originates
Rise installment loans in 17 states. FinWise Bank retains 4% of the balances of
all the loans originated and sells a 96% participation to a third-party SPV, EF
SPV, Ltd. We do not own EF SPV, but we are required to consolidate EF SPV as a
VIE under US GAAP and the condensed consolidated financial statements include
revenue, losses and loans receivable related to the 96% of Rise installment
loans originated by FinWise Bank and sold to EF SPV.

Beginning in 2018, we started licensing the Today Card brand and our
underwriting services and platform to launch a credit card product originated by
CCB, which initially provides all of the funding for that product. CCB retains
5% of the credit card receivable balance of all the receivables originated and
sells a 95% participation in the Today Card credit card receivables to us. The
Today Card program began expanding in 2020.

Beginning in the third quarter of 2020, we also license our Rise installment
loan brand to an additional bank, CCB, which originates Rise installment loans
in three different states than FinWise Bank. Similar to the relationship with
FinWise Bank, CCB retains 5% of the balances of all of the loans originated and
sells the remaining 95% loan participation in those Rise installment loans to EC
SPV. We do not own EC SPV, but we are required to consolidate EC SPV as a VIE
under US GAAP and the condensed consolidated financial statements include
revenue, losses and loans receivable related to the 95% of the Rise installment
loans originated by CCB and sold to EC SPV.

The information presented in the tables below on a combined basis are non-GAAP
measures based on a combined portfolio of loans, which includes the total amount
of outstanding loans receivable that we own and that are on our balance sheets
plus outstanding loans receivable originated and owned by third parties that we
guarantee pursuant to CSO programs in which we participate. There were no new
loan originations in 2021 under our CSO programs, but we continued to have
obligations as the CSO until the wind-down of this portfolio was completed in
the third quarter of 2021. See "-Basis of Presentation and Critical Accounting
Policies-Allowance and liability for estimated losses on consumer loans."

We believe these non-GAAP measures provide investors with important information
needed to evaluate the magnitude of potential loan losses and the opportunity
for revenue performance of the combined loan portfolio on an aggregate basis. We
also believe that the comparison of the combined amounts from period to period
is more meaningful than comparing only the amounts reflected on our balance
sheet since both revenues and cost of sales as reflected in our financial
statements are impacted by the aggregate amount of loans we own and those CSO
loans we guaranteed.



                                       57
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Our use of total combined loans and fees receivable has limitations as an
analytical tool, and you should not consider it in isolation or as a substitute
for analysis of our results as reported under US GAAP. Some of these limitations
are:

• Rise CSO loans were originated and held by a third party lender; and

• The Rise CSO loans were funded by a third party lender and were not part of the VPC Facility.

At each of the period ends indicated, the following table presents a reconciliation of:

•Loans receivable, net and at fair value, held by the Company (which correspond to our condensed consolidated balance sheets included elsewhere in this Quarterly Report on Form 10-Q);


•Loans receivable, net, guaranteed by the Company (as disclosed in Note 3 of our
condensed consolidated financial statements included elsewhere in this Quarterly
Report on Form 10-Q);

•Loans receivable combined (which we use as a non-GAAP measure); and

•Combined loan loss reserve (which we use as a non-GAAP measure).

                                       58
--------------------------------------------------------------------------------
                                                                                    2021                                             2022
(Dollars in thousands)                                       June 30           September 30          December 31          March 31           June 30
Company Owned Loans:
Loans receivable - principal, current, company
owned                                                      $ 372,068        

$466,140 $501,552 $457,259 $477,721
Loans receivable – principal, overdue, company property

                                                 27,231                46,730              57,207             54,060             54,712
Loans receivable - principal, total, company
owned                                                        399,299               512,870             558,759            511,319            532,433
Loans receivable - finance charges, company
owned                                                         19,157                22,960              23,602             22,991             23,079
Loans receivable - company owned                             418,456               535,830             582,361            534,310            555,512
Allowance for loan losses on loans receivable,
company owned(5)                                             (40,314)              (56,209)            (71,204)                 -                  -
Fair value adjustment, loans receivable-
principal                                                          -                     -                   -             49,844             53,438
Loans receivable, net, company owned / Loans
receivable at fair value                                   $ 378,142          $    479,621          $  511,157          $ 584,154          $ 608,950
Third Party Loans Guaranteed by the Company:
Loans receivable - principal, current,
guaranteed by company                                      $      17        

– $ – $ – $ – $ – Loans receivable – principal, past due, company guaranteed

                                              4                     -                   -                  -                  -
Loans receivable - principal, total,
guaranteed by company(1)                                          21                     -                   -                  -                  -
Loans receivable - finance charges, guaranteed
by company(2)                                                      4                     -                   -                  -                  -
Loans receivable - guaranteed by company                          25                     -                   -                  -                  -
Liability for losses on loans receivable,
guaranteed by company                                             (7)                    -                   -                  -                  -
Loans receivable, net, guaranteed by
company(3)                                                 $      18        

– $ – $ – $ – $ Combined loans receivable(3): Combined loans receivable – principal, current

             $ 372,085        

$466,140 $501,552 $457,259 $477,721
Combined Loans Receivable – Principal, Overdue

                                                           27,235                46,730              57,207             54,060             54,712
Combined loans receivable - principal                        399,320               512,870             558,759            511,319            532,433
Combined loans receivable - finance charges                   19,161                22,960              23,602             22,991             23,079
Combined loans receivable                                  $ 418,481          $    535,830          $  582,361          $ 534,310          $ 555,512
Combined Loan Loss Reserve(3):
Allowance for loan losses on loans receivable,
company owned(5)                                           $ (40,314)       

($56,209) ($71,204) $ – $ – Liability for loan losses, guaranteed by the company

                                             (7)                    -                   -                  -                  -
Combined loan loss reserve(5)                              $ (40,321)       

($56,209) ($71,204) – $ – $ Combined loans receivable – principal, overdue(3)

                                                     $  27,235        

$46,730 $57,207 $54,060 $54,712
Combined loans receivable – principal(3)

                     399,320               512,870             558,759            511,319            532,433
Percentage past due(1)                                             7  %                  9  %               10  %              11  %              10  %
Combined loan loss reserve as a percentage of
combined loans receivable(3)(4)(5)                                10  %                 11  %               12  %               -  %               -  %
Allowance for loan losses as a percentage of
loans receivable - company owned(5)                               10  %                 11  %               12  %               -  %               -  %
Fair value adjustment, combined loans
receivable- principal(6)                                   $  51,078        

$50,036 $57,184 $49,844 $53,438


Combined loans receivable at fair value(6)                   469,559               585,866             639,545            584,154            608,950
Fair value as a percentage of combined loans
receivable- principal(3)(6)                                      113  %                110  %              110  %             110  %             110  %


_________
(1)Represents loans originated by third-party lenders through the CSO programs,
which are not included in our condensed consolidated financial statements. The
wind-down of the CSO program was completed in the third quarter of 2021.
(2)Represents finance charges earned by third-party lenders through the CSO
programs, which are not included in our condensed consolidated financial
statements. The wind-down of the CSO program was completed in the third quarter
of 2021.
(3)Non-GAAP measure
(4)Combined loan loss reserve as a percentage of combined loans receivable is
determined using period-end balances.
(5)Effective January 1, 2022, upon the election to carry the loan portfolio at
fair value, a combined loan loss reserve and allowance for loan losses is no
longer required as a loan loss assumption has been included in the fair value
assumptions for the loan portfolio.
(6)The periods of June 30, 2021 to December 31, 2021 include pro-forma
adjustments reflecting the combined loans receivable at fair value consistent
with a fair value methodology acceptable with U.S. GAAP.





                                       59
--------------------------------------------------------------------------------

COMPONENTS OF OUR OPERATING RESULTS

Revenue


Our revenues are composed of Rise finance charges and CSO fees (inclusive of
finance charges attributable to the participation in Rise installment loans
originated by FinWise Bank and CCB), cash advance fees attributable to the
participation in Elastic lines of credit that we consolidate, finance charges
and fee revenues related to the Today Card credit card product (inclusive of
finance charges attributable to the participations in the credit card
receivables originated by CCB), and marketing and licensing fees received from
third-party lenders related to the Rise, Rise CSO, Elastic, and Today Card
products. See "-Overview" above for further information on the structure of
Elastic.

Cost of sales


Change in Fair value. Beginning January 1, 2022, we elected the fair value
option for our loans receivable portfolio. As such, loans receivable are carried
at fair value in the Condensed Consolidated Balance Sheets with changes in fair
value recorded in the Condensed Consolidated Statements of Operations. To derive
the fair value, we generally utilize discounted cash flow analyses that factor
in estimated losses and prepayments over the estimated duration of the
underlying assets. Loss and prepayment assumptions are determined using
historical loss data and include appropriate consideration of recent trends and
anticipated future performance. Future cash flows are discounted using a rate of
return that we believe a market participant would require.

Provision for loan losses. Prior to January 1, 2022, provision for loan losses
consists of amounts charged against income during the period related to net
charge-offs and the additional provision for loan losses needed to adjust the
loan loss reserve to the appropriate amount at the end of each month based on
our loan loss methodology.

Direct marketing costs.  Direct marketing costs consist of online marketing
costs such as sponsored search and advertising on social networking sites, and
other marketing costs such as purchased television and radio advertising and
direct mail print advertising. In addition, direct marketing cost includes
affiliate costs paid to marketers in exchange for referrals of potential
customers. All direct marketing costs are expensed as incurred.

Other cost of sales. Other costs of sales include data verification costs associated with signing up prospective customers and Automated Clearing House (“ACH”) transaction costs associated with funding and making loan payments to customers.

Operating Expenses


Operating expenses consist of compensation and benefits, professional services,
selling and marketing, occupancy and equipment, depreciation and amortization as
well as other miscellaneous expenses.

Benefits and compensation. Salaries and personnel costs, including benefits, bonuses and stock-based compensation expenses, constitute the majority of our operating expenses and these costs are determined by our number of employees.


Professional services.  These operating expenses include costs associated with
legal, accounting and auditing, recruiting and outsourced customer support and
collections.

Selling and marketing.  Selling and marketing costs include costs associated
with the use of agencies that perform creative services and monitor and measure
the performance of the various marketing channels. Selling and marketing costs
also include the production costs associated with media advertisements that are
expensed as incurred over the licensing or production period. These expenses do
not include direct marketing costs incurred to acquire customers, which
comprises CAC.

Occupancy and equipment. Occupancy and equipment includes rental charges for our leased facilities, as well as telephony and web hosting charges.


Depreciation and amortization.  We capitalize all acquisitions of property and
equipment of $500 or greater as well as certain software development costs.
Costs incurred in the preliminary stages of software development are expensed.
Costs incurred thereafter, including external direct costs of materials and
services as well as payroll and payroll-related costs, are capitalized.
Post-development costs are expensed. Depreciation is computed using the
straight-line method over the estimated useful lives of the depreciable assets.








                                       60
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Other expenses


Net interest expense.  Net interest expense primarily includes the interest
expense associated with the VPC Facility that funds the Rise installment loans,
the ESPV Facility related to the Elastic lines of credit and related Elastic SPV
entity, the EF SPV and EC SPV Facilities that fund Rise installment loans
originated by FinWise Bank and CCB, respectively, the TSPV facility used to fund
credit card receivable purchases, and the Pine Hill subordinated debt facility
used to fund working capital. Interest expense also includes any amortization of
deferred debt issuance cost and prepayment penalties incurred associated with
the debt facilities.

Gain or loss on investment using the equity method. Investment loss under the equity method includes our share of profit or loss associated with an investment in an unconsolidated subsidiary beginning in the first quarter of 2022.

© Edgar Online, source Previews

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ConsolidationNow has been reorganized as RixLoans Payday https://i69texas.org/consolidationnow-has-been-reorganized-as-rixloans-payday/ Fri, 05 Aug 2022 00:53:26 +0000 https://i69texas.org/consolidationnow-has-been-reorganized-as-rixloans-payday/ ConsolidationNow has been rebranded RixLoans Payday. This change reflects the company’s desire to help consumers obtain better loan products and services. The changes will also allow the company to reach more borrowers in various states across the United States. The RixLoans website is more user-friendly and loan applications will take less time to complete. Consumers […]]]>

ConsolidationNow has been rebranded RixLoans Payday. This change reflects the company’s desire to help consumers obtain better loan products and services. The changes will also allow the company to reach more borrowers in various states across the United States.

The RixLoans website is more user-friendly and loan applications will take less time to complete. Consumers who submit their loan applications early can receive their funds the same day. Most applicants will receive their money within 24 hours of approval. Borrowers who cannot obtain loans from traditional financial institutions due to bad credit will have a high chance of obtaining loans from RixLoans without going through a rigorous credit check.

As more Americans face financial challenges in 2022, RixLoans founder Usman Konst aims to provide loans at competitive rates and educate more people about personal finance. He believes that everyone deserves a second chance in life. The founder of RixLoans has made it easier for more people to get loan approvals online by linking them to many direct lenders.

The company will meet the needs of all borrowers looking for payday loans, installment loans and title loans, among other financial products. His financial news blog will also help consumers keep up to date with the latest news from the lending industry. This blog will benefit those who are looking for money saving tips and developments in the lending industry.

In addition to providing online loan services, RixLoans will also strive to give back to the community. The company will do this through child welfare initiatives, food bank donations and awareness activities. Customers can receive more updates regarding these programs by following the company on all of its social media platforms.

RixLoans understands that every borrower needs security assurance when submitting their details online. That’s why the company uses computer virus protection software to detect and prevent malicious programs on its computer network. It also uses secure transmissions to help maintain data privacy. All information is sent using 128-bit Secure Socket Layer (SSL) encryption. Borrowers from all states that allow payday loans can access RixLoans loan services. The company operates online and anyone who meets the payday loan eligibility criteria can apply through the company’s website.

Media Contact
Company Name: RixLoans
E-mail: Send an email
Address:2800 NE 209th Street
Town: Adventure
State: FL 33180
Country: United States
Website: rixloans.com/

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ZayZoon charges employees $5 to get paid early – TechCrunch https://i69texas.org/zayzoon-charges-employees-5-to-get-paid-early-techcrunch/ Wed, 03 Aug 2022 11:25:52 +0000 https://i69texas.org/zayzoon-charges-employees-5-to-get-paid-early-techcrunch/ Despite the so-called Great Resignation, wages have not risen as dramatically as some economists had predicted. About 41% of workers recently interrogates by Willis Towers Watson say they live paycheck to paycheck, while Bureau of Economic Advisers reports personal savings rates achieved a seven-year low in April – reflecting the dire financial situation many workers […]]]>

Despite the so-called Great Resignation, wages have not risen as dramatically as some economists had predicted. About 41% of workers recently interrogates by Willis Towers Watson say they live paycheck to paycheck, while Bureau of Economic Advisers reports personal savings rates achieved a seven-year low in April – reflecting the dire financial situation many workers find themselves in.

Tate Hackert, the president of Calgary-based ZayZoon, says inflexible pay schedules are a major contributor to inequity. That’s one of the reasons he founded ZayZoon, he says — so workers can access payment when bills come due rather than on a set schedule.

To grow the business, ZayZoon today closed a $12.5 million funding round co-led by Carpe Diem Investments and Alpenglow Capital with participation from InterGen Capital, Prairie Merchant Corporation and several angel investors. . Along with a $13 million loan from ATB Financial, the proceeds bring ZayZoon’s total equity raised to date to $25 million.

“Saving every penny I earned, when I was 16, I provided mortgage financing to a family friend in exchange for interest payments,” Hackert told TechCrunch in an interview by E-mail. “The same patterns emerged – people with relatively [good] incomes that needed a small capital for a small period of time just to get by… I sought to create a product that could help employees in their most vulnerable moments, while remaining socially responsible and true to a mission of improving their overall financial health.”

ZayZoon’s platform allows small and medium-sized businesses to implement what is known as an Earned Wage Access (EWA) program. EWA allows employees to access a portion of their accrued salary before the end of their pay cycle. Workers always receive their full salary at the end of each cycle. However, the advances made are subtracted from the direct deposit account.

ZayZoon self-funds advance wage demands to mitigate risk on the employer’s side. The service is free for businesses, but ZayZoon charges workers a $5 fee to choose how much of their salary they want to access (up to $200). Companies can choose – but are not required – to subsidize the benefit.

Funding applications are disbursed “in minutes” to employee accounts, or workers can sign up for a ZayZoon-branded Visa card that acts as a prepaid debit card. Whether or not they decide to go the prepaid route, workers can link ZayZoon to their bank accounts for spending information in addition to overdraft alerts and minimum account balance fees.

“Employers assume that implementing an EWA program takes immense effort, but ZayZoon can fully activate a business in less than an hour, with the majority taking less than a few minutes,” Hackert said. “Over 3,000 companies offer ZayZoon to their workforce today…Depending on industry and employee demographics, it’s typical for a company that deploys ZayZoon that 25% to 45% of its workforce regularly accesses ZayZoon .”

ZayZoon says franchisees Sonic, McDonald’s, Domino’s and Hilton are among its customers.

ZayZoon is part of a massive industry, of course, with research company Aite-Novarica Group Estimate that EWA vendors moved about $9.5 billion in salary in 2020. India’s Refyne raised $82 million to do so in January, while platforms like Branch, DailyPay and Even secured hundreds of million dollars for their EWA services.

But despite the venture capital money and big brand mentions Like Uber, Lyft, and Walmart, EWA comes under increased scrutiny from regulators, including the U.S. Consumer Financial Protection Bureau (CFPB) and the California Department of Financial Protection and Innovation. For example, in New Jersey, recently enacted rules require EWA providers to confirm a client’s earned income before sending them an advance and obtain employee consent before obtaining worker information. with employers.

Picture credits: ZayZoon

Some consumer groups argue that EWA programs should be classified as loans under the U.S. Truth in Lending Act, which includes protections such as requiring lenders to give notice before raising certain fees. The groups argue that some EWA programs can force users into overdraft while charging interest through fees.

A fee of $5 per pay period may not seem like much, but it can add up, especially for a low-income worker, and the consequences can be disastrous. Just $100 less in savings can make families more likely to pursue predatory lending and forgo utility bill payments, a 2020 study show; a valued one in five families in the United States has less than two weeks of liquid savings.

Hackert is working to steer ZayZoon away from “predatory” EWA programs, positioning it instead as a welcome alternative to late bill payments, overdraft fees, and payday loans. Users are not legally obligated to repay ZayZoon and ZayZoon will not take any action to collect payments, but non-paying users will be restricted from accessing the service in the future. At the same time, Hackert suggests that ZayZoon can protect companies – especially small independent businesses – employees who would otherwise steal from the cash register to make ends meet.

“ZayZoon is special in the competitive landscape because we specifically cater to small and medium-sized businesses,” Hackert said. “ZayZoon has specifically sought to serve the underserved…Financial stress is a major contributor to lost productivity and health issues.”

However, it is unclear whether EWA programs are a net positive for business. Using Walmart as an example, the retail giant had high hopes of boosting retention by giving employees early access to earned wages. Instead, it found that employees using the Early Salary Access service tendency to quit faster.

It’s not just companies that might have grievances. Some workers might object to how ZayZoon shares their personal information. For example, the company has a partnership with Prizeout to run ZayZoon Boost, an optional service that pays out salaries in the form of gas, grocery, and retail gift cards. ZayZoon advertises Boost as a way to earn gift cards worth more than salary advance payments. But in its privacy policy, ZayZoon specifies that users participating in Boost agree to transfer personal and financial information to Prizeout, including their name, date of birth, gender and address.

Beyond Boost, ZayZoon reserves the right to use any user data to conduct research, contests, surveys and sweepstakes and use it for marketing and promotions. Hackert notes that workers can email ZayZoon customer support to request deletion of their data, but there is no in-app mechanism to facilitate this task.

“Companies care about ZayZoon because we dramatically improve their employee well-being, productivity, retention, and recruitment efforts,” Hackert said. “ZayZoon is actively seeking to collaborate on [regulatory] and supports thoughtful regulation, because ambiguity is never a good thing. There are market entrants who unfortunately take advantage of this ambiguity at the expense of the consumer – by charging high fees, operating in a non-transparent manner and enforcing the confidentiality of a consumer’s data.

With proceeds from the seed round and debt, ZayZoon plans to invest in general product development and market expansion. Asked if ZayZoon plans to hire in light of the global economic downturn, Hackert said yes, saying he aims to grow the workforce from 60 employees to 85 by the end of the year. the year.

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ACE Cash Express Launches New School of ACE Scholarship Program https://i69texas.org/ace-cash-express-launches-new-school-of-ace-scholarship-program/ Mon, 01 Aug 2022 16:46:24 +0000 https://i69texas.org/ace-cash-express-launches-new-school-of-ace-scholarship-program/ The scholarship program will provide financial support to students who plan to pursue a career in the financial sector. ACE Cash Express has a long history of offering a wide range of financial products and services, including short-term loans, card services, check cashing, money transfers, and more. The company has always been committed to helping […]]]>

The scholarship program will provide financial support to students who plan to pursue a career in the financial sector.

ACE Cash Express has a long history of offering a wide range of financial products and services, including short-term loans, card services, check cashing, money transfers, and more. The company has always been committed to helping people achieve their dreams of getting an education, and this scholarship program is just another example of their commitment to creating opportunities for people who want to have a impact on their community.

The scholarship program will award $50 per month for up to five years (up to $2,500 in total). The amount of the scholarship may be increased depending on the academic results of the candidate. Applicants must have at least a 2.5 GPA (or equivalent) to be considered.

To make this opportunity possible, the company has partnered with 1FirstCashAdvancea service that brings together hundreds of direct lenders on a single platform.

The new partnership will provide 1FirstCashAdvances customers with the ability to get cash loans quickly, regardless of their credit history. Customers can now apply for any loan amount and receive their funds within 24 hours. Additionally, they can access over 150 lenders and a variety of loan products including payday loans, installment loans, title loans, and more.

Their goal is to make it easy for all Americans to find the right loan product that meets their needs and budget. The goal is for every customer to get the money they need quickly and affordably through our partnership with 1FirstCashAdvance.

“We are excited about this partnership as it will allow us to offer more options to our customers,” said Leron Gubler, CEO of ACE Cash Express. “Thanks to this new relationship, we will be able to offer them a wider range of products and services to meet their financial needs.

Along with this scholarship, 1FirstCashAdvance has its program called Financial Champions Scholarship. It is designed to recognize and reward high school students who prove financial responsibility and plan to attend a two- or four-year college in the United States, Canada, or Puerto Rico. Students must be US citizens or permanent residents and have a GPA of 3.0 or higher to be eligible for this scholarship.

Students will be assessed on their academic performance, financial need, community service activities, leadership roles in organizations, and community involvement. The award is valued at $1,000 per year for up to four years of undergraduate study at a two- or four-year college.

Latoria Williams, CEO of 1FirstCashAdvance, is on a mission to educate those who have limited access to traditional financial resources about responsible lending. She shared her vision for making credit accessible to everyone. “We believe that every person deserves the opportunity to be able to build their credit,” she said. “If you don’t build your credit, it’s hard to get approved for anything in life.”

Williams believes that by giving people access to affordable loans, she can give them a boost and help them achieve their dreams.


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DFPI Bulletin Digest: July 2022 https://i69texas.org/dfpi-bulletin-digest-july-2022/ Fri, 22 Jul 2022 16:17:09 +0000 https://i69texas.org/dfpi-bulletin-digest-july-2022/ July 2022 DFPI Bulletin Focuses on Small Businesses funding disclosuresproposed rules on commercial financial productsand the Contribution rate 2022-2023 for financial institutions, among other topics. Editor’s Note – California Financial Protection and Innovation Department (DFPIformerly the Business Supervision Department) oversees, licenses and regulates a variety of financial institutions, including certain home mortgage originators (MLOs) holding […]]]>

July 2022 DFPI Bulletin Focuses on Small Businesses funding disclosuresproposed rules on commercial financial productsand the Contribution rate 2022-2023 for financial institutions, among other topics.

Editor’s Note – California Financial Protection and Innovation Department (DFPIformerly the Business Supervision Department) oversees, licenses and regulates a variety of financial institutions, including certain home mortgage originators (MLOs) holding a National Multi-State (or Mortgage) Licensing System and Registry (NMLS) Licence. Along with the California Department of Real Estate (DRE), the DFPI shares responsibility for overseeing MLOs based on their use of licenses.

Licensees, stay up to date with MLO July 2022 news and events below.

Extension of Commercial Finance Disclosure Regulations

On June 9, 2022, California Office of Administrative Law (OAL) approved the DFPI’s proposed regulation on trade finance disclosure. The regulations extend disclosure protections to California small businesses when those businesses seek commercial financing.

The disclosures will take effect on December 9, 2022. They are intended to provide small businesses in California with a better understanding of the costs and benefits of commercial financing offers. Armed with this information, small businesses will be better able to compare different offers to find the best financing solution for their needs. The final settlement and Final Statement of Reasons are posted on the DFPI website.

The DFPI’s work on these disclosures dates back to the passage of SB-1235 in 2018, which requires commercial finance providers to provide information to small businesses. The bill requires suppliers to disclose:

  • total funds provided;
  • total dollar cost of financing;
  • duration or estimated duration;
  • method, frequency and amount of payments;
  • a description of prepayment penalties; and
  • the total cost of financing at an annualized rate.

Related article:

The Future of Cryptocurrency in Real Estate Transactions

Proposed rules on commercial financial products and services

The DFPI filed a Notice of Proposed Action invite the public to comment on proposed regulations under the Consumer Financial Protection Act (CCFPL). The proposed regulations implement, interpret or establish specific provisions of the Financial Code relating to the commercial financing of small businesses, non-profit organizations and family farms.

Submit your comments by email to regulation@dfpi.ca.gov with a copy to Samuel.Park@dfpi.ca.gov. Please include “PRO 02-21” in the subject line.

Alternatively, comments can be mailed to:

Financial Protection and Innovation Department
Attention: Sandra Navarro
2101 Arena Blvd.
Sacramento, CA 95834

The Text of the draft regulation and the Initial statement of reasons are available on the DFPI website.

The 45-day public comment period ends on August 8, 2022.

Public comment period on oversight of financial services related to crypto assets

While public interest in cryptocurrencies has exploded since the pandemic, regulation remains thin. Regarding the oversight of financial products and services related to crypto-assets, the DFPI is currently seeking comments on:

  • regulatory priorities;
  • Regulation and supervision of CCFPL; and
  • market surveillance functions.

For any regulatory recommendation, commenters are encouraged to provide a description of any economic impact of the recommendation for California businesses and consumers.

Governor Gavin Newsom released Executive Order N-9-22 last May to create a transparent regulatory and commercial environment for web3 companies, to foster responsible innovation, support the Californian economy and, above all, protect consumers. As part of this strategy, the DFPI is seeking input to develop regulatory guidance, clarity, and oversight in the offering of financial products and services related to crypto assets in California.

The DFPI has posted topics and questions to help reviewers generate feedback. Find the formal Call for comments on the DFPI website.

Comments will be accepted until August 5, 2022, and can be submitted by email to regulation@dfpi.ca.gov. Include “Review Invitation – Financial Products and Services Related to Crypto Assets” in the subject line.

Comments can also be mailed to:

Financial Protection and Innovation Department, Legal Department
Attention: Sandra Navarro, Rules Coordinator
2101 Arena Blvd.
Sacramento, CA 95834

2022-23 contribution rates for financial institutions

On June 30, 2022, the 2022-23 Annual Assessment invoice was emailed to banks, credit unions, and money transmitters. Licensees who have not received their invoices should notify the Accounts Receivable Unit at AccountingAR@dfpi.ca.gov as soon as possible.

Invoices are payable no later than August 1, 2022 with more time allowed for payments made by Electronic Funds Transfer (EFT). EFT payments are due by August 8, 2022.

For commercial banks, foreign banksand trust companiesthe base rate was set at $1.39 per $1,000 of assets, down $0.05 from last year’s rate of $1.44.

For credit unionsthe 2021-22 contribution rate has been set at $1.01 per $1,000 of assets, the same rate as last year.

For industrial banksthe base rate was set at $1.39 per $1,000 of assets, down $0.05 from last year’s rate of $1.44.

Finally, for money transmitters, the 2021-2022 contribution rate has been set at $0.014 per $1,000 received for transmission by a holder during the 2021 calendar year, a decrease of $0.006 from the rate for the year last. The 2021-2022 assessment rate for issuers of payment and stored value instruments has been set at $0.63 per $1,000 of payment and stored value instruments sold by a licensee.

For valuation calculation questions, refer to “How to calculate your assessmentor contact Patrick Carroll at (415) 263-8559 or patrick.carroll@dfpi.ca.gov. Questions regarding the processing of assessment payments should be directed to the Accounts Receivable Unit at AccountingAR@dfpi.ca.gov.

Openings of the Escrow Advisory Committee

From September 2022, there will be three openings on the Escrow Advisory Committee.

The Committee is made up of eleven members, including the Statutory Auditor (or his delegate).

Appointed members sit for a period of two years without indemnity or reimbursement of expenses. The committee meets quarterly at the ministry office. The next meeting is tentatively scheduled for Wednesday, September 7, 2022.

The current vacancies on the committee are representatives of:

  • a small escrow company;
  • an escrow company that has a different type of business ownership; and
  • a CPA who has fiduciary clients.

Managers or corporate officers of independent escrow companies are eligible to serve. Examples of different business ownership include companies owned by title companies or brokers.

Chartered Trustees and qualified CPAs who meet any of the above criteria are encouraged to apply by sending a letter of qualifications and/or resume to Paul Liang at Paul.Liang@dfpi.ca.gov, or by post to:

Financial Protection and Innovation Department
320 West 4th Street, Suite 750
Los Angeles, California 90013

The deadline for submission is July 29, 2022. Direct your questions to Paul.Liang@dfpi.ca.gov or (213) 576-7535.

2021 report on increased access to responsible small loans and nonprofits

The DFPI published the Annual report 2021 of the Pilot program for increased access to responsible small loans (RSDL). The program is designed to provide an alternative to payday loans and other more expensive forms of consumer credit. This report contains detailed information collected earlier this year from participating lenders.

The pilot program aims to increase the availability of small responsible installment loans by at least $300 but less than $2,500. In 2018, the maximum loan amount increased to $7,500.

In addition, the DFPI published the 2021 Annual Report for Nonprofit Entities Offering Zero-Rate Loans. Senate Bill 896 was signed into law in 2015 to encourage nonprofit organizations (exempt organizations) to facilitate low-interest, low-cost loans. In part, small dollar loans are intended to allow consumers to establish, build and improve their credit ratings.

This is the end of the July 2022 DFPI Bulletin. For more on the topics mentioned here, read the full bulletin on the DFPI website.

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PaydayChampion explains the ins and outs of lending to direct lenders https://i69texas.org/paydaychampion-explains-the-ins-and-outs-of-lending-to-direct-lenders/ Thu, 21 Jul 2022 21:29:58 +0000 https://i69texas.org/paydaychampion-explains-the-ins-and-outs-of-lending-to-direct-lenders/ Reading time: 3 minutes One of the best places to get a loan is from a direct lender. It is likely that using a direct internet lender to apply for a loan would seem strange, but eligible people can benefit from this method. Is it better to go to a traditional bank or a direct […]]]>
Reading time: 3 minutes

One of the best places to get a loan is from a direct lender. It is likely that using a direct internet lender to apply for a loan would seem strange, but eligible people can benefit from this method.

Is it better to go to a traditional bank or a direct lender?

In the financial sector, a “direct lender” is a company or institution that directly lends money to customers. The absence of application fees means that a direct lender can provide loans at no additional cost.

Medical bills, buying a new car, home renovations, etc. can all be paid for using payday loans from a direct lender.

An organization’s funds are transferred directly to a consumer who applies for a loan through a direct lender. As an alternative, brokers serve as a link between potential borrowers and lenders who are willing to provide loans to people in need. If your loan application is approved, lenders interested in working with you will receive your contact information.

All relevant information must be collected by the lender before an offer can be made. As soon as you accept our offer and agree to the terms, your bank account will be debited.

Do direct lending institutions have advantages over traditional lenders?

If you are authorized to obtain a loan through a direct lender, you will interact directly with that lender. The rest is up to him.

A direct lender may offer better interest rates and terms than a bank or credit card company.

There may be reduced interest rates and terms offered by direct lenders because they understand that their consumers want fast loans and don’t want to face lengthy application processes. Financiers who are directly involved in the process Within minutes or hours in most situations, the customer’s bank account will receive funds from a direct lender.

Your credit score is not taken into account when applying for a loan from a direct lender, which simply requires the minimum amount of information. As a result, direct lenders better understand your situation as a borrower. If the process is made more onerous for you, it will be counterproductive to their goal of providing emergency loans to people in need.

Direct lenders offer a wide range of loan options and a high degree of customization. Direct lenders.

It is possible for direct lenders to provide loans with a high degree of customization and adjustment. They are also able to customize a loan to meet your individual needs and make recommendations on how to better manage your money. It is possible to find lenders willing to work with borrowers whose credit is not perfect, for example. There are a number of unforeseen expenses that lenders could help you with, including medical bills and home repairs.

Faster loan processing is provided by direct lenders.

You can get the cash you need fast with a payday loan through PaydayChampion. In times of financial emergency, a payday loan may be more convenient than a traditional bank loan. You may be able to get your money within 24 hours under certain circumstances.

There is no middleman in the lending process for direct lenders.

In direct loans, there are no intermediaries involved. In other words, you won’t have to pay a broker or middleman to use their services. If you have bad credit, you may not be able to get a loan from a bank or other traditional lender. A direct lender loan could be a lifesaver in these situations.

If you’re looking to get a loan from a direct lender, this article should help you understand your options.

Aubrey Saffa Bender

Content Editor and Writer at Payday Champion

Aubrey Saffa Bender has been a freelance journalist and journalist since 2013. She writes on topics ranging from personal finance and education to technology and business. In her work for PaydayChampion, Aubrey draws primarily from her experiences writing about mortgages, home buying and real estate. She earned a BA with a major in English from the University of Colorado at Boulder.

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Online Payday Loans – Cover Emergency Expenses Online – CryptoMode https://i69texas.org/online-payday-loans-cover-emergency-expenses-online-cryptomode/ Mon, 11 Jul 2022 11:45:37 +0000 https://i69texas.org/online-payday-loans-cover-emergency-expenses-online-cryptomode/ Where can you get money for emergency expenses? How can you do it? These are the questions most frequently asked by Americans in financial difficulty. Many of them have found the answers with online payday loans. These are loans issued by direct lenders. Borrowers usually take this type of loan for a short period of […]]]>

Where can you get money for emergency expenses? How can you do it? These are the questions most frequently asked by Americans in financial difficulty. Many of them have found the answers with online payday loans. These are loans issued by direct lenders.

Borrowers usually take this type of loan for a short period of time until the next paycheck. Therefore, the refund should be made within 2-4 weeks. Penalties are applied to borrowers who do not repay on time.

Advantages of payday loans from direct lenders

Online payday loans Hart Loan have already saved many lives. But what makes them so attractive to potential borrowers? Here are some explanations to consider.

Convenience of use

Compared to banks and credit unions, online lenders offer more realistic chances of getting a payday loan. So you can do it at any time of the day and night. Plus, you can do it on your cell phone or desktop computer. You are free to choose the format that suits you best.

Accessibility

Payday loans from direct lenders are issued after review by the lender. During it, a wide range of factors are considered. Your credit score isn’t the only thing that matters. Your current income is all the more important since lenders want to be sure of your financial capabilities. As long as you have sufficient income, you automatically become an eligible candidate.

Security

Without any third party interfering, you are responsible for communicating with the selected lender. You can track the entire process, from application to actual funding. As long as everything is going well with your app, you are safe from scammers. If something goes wrong, you will be able to give an immediate reaction.

How do direct payday loans work?

All application process is fast, secure and easy. Submit your loan application form on the lender’s website. Only a few personal details are needed. You can expect a response within seconds. If approved, you will receive the requested amount in your bank account within few hours.

After approval, you should not forget to read the proposed terms and conditions. If you are satisfied, you will need to affix an electronic signature to express your consent.

Remember that you don’t have to accept a loan offer. If you accept the offer, your money will be deposited within one business day. As simple as possible!

To be eligible for an online personal loan https://paydayloans.epigenome-noe.net/ , the minimum qualifications must be met beforehand. The most common include:

  • Have an average monthly income must be $1,000 or more
  • Be a US citizen or permanent resident
  • Be 18 or older
  • Have access to active email and phone number
  • Have a valid checking account

Eligibility criteria may vary from state to state and from lender to lender. Before applying, the very first thing you need to do is make sure that payday loans are allowed in your state of residence.

Choosing a direct lender to apply for a payday loan online?

To get a payday loan online, you must first find a reliable lender. This might seem like an easy thing to do given the wide variety of options. But this is not the case. Market growth makes it difficult to distinguish between good and bad options. A hasty decision can put you at risk of being scammed.

What you need to do is do your research by comparing at least several lenders. Pay attention to their loan offers, loan terms and repayment policies. Don’t forget to check the license as well. Make the final choice based on the information gathered.

CryptoMode produces high quality content for cryptocurrency companies. To date, we’ve provided brand visibility for dozens of companies, and you can be one of them. All our customers appreciate our value for money ratio. Contact us if you have any questions: [email protected]

None of the information on this website is investment or financial advice. CryptoMode is not responsible for any financial losses incurred while acting on the information provided on this website by its authors or customers. No advice should be taken at face value, always do your research before making financial commitments.

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Financially stressed? Join the club! 3 Tips to Help Reduce Money Worries | Silver https://i69texas.org/financially-stressed-join-the-club-3-tips-to-help-reduce-money-worries-silver/ Tue, 05 Jul 2022 23:59:18 +0000 https://i69texas.org/financially-stressed-join-the-club-3-tips-to-help-reduce-money-worries-silver/ A perfect storm of world events naturally triggers financial stress for the vast majority of Americans. In a recent investigation speak American Psychological Associationmore than 80% of American adults reported feeling increased financial stress due to: Higher inflation (87%). Persistent supply chain issues caused by the pandemic (81%). Global uncertainty due […]]]>


A perfect storm of world events naturally triggers financial stress for the vast majority of Americans. In a recent investigation speak American Psychological Associationmore than 80% of American adults reported feeling increased financial stress due to:

  • Higher inflation (87%).
  • Persistent supply chain issues caused by the pandemic (81%).
  • Global uncertainty due to the war in Ukraine (81%).

Moreover, the difficulties associated with the coronavirus pandemic – including poor health, loss of loved ones, difficult work and family situations, isolation and inconvenience – have affected the entire nation and the world. In the United States, 63% of respondents said COVID-19 had changed their lives forever.

The financial toll of stressed employees has also had an impact on businesses. A investigation survey by PwC reported that 34% of employees across multiple industries said money worries in the past year had a major to severe impact on their mental health; 18% said it hurt their productivity at work; 38% of financially stressed employees said they were looking for a new job; and 37% of them had used payday loans in the previous year.

The obvious question in the wake of all this increased financial stress is, how can you reduce it?


1. Structure and stick to a budget

This is an alarming figure: at the start of 2022, nearly two-thirds of the US population lived paycheck to paycheck. Soaring inflation is certainly a factor, but the bottom line for many financially challenged individuals and families is that they:

  • Not having a budget.
  • If they do, they don’t stick to it.

Financial stress is often caused by a mismatch between the money you spend and the money coming in.

Build a budget that matches your monthly income and expenses — the latter includes all monthly bills and debt — then use an expense tracker to learn more about your spending habits. All of this information will help you identify ways to reduce your expenses, starting with eliminating more non-essential expenses.


2. Be strategic and create a debt repayment plan

Growing debts or barely paying them off each month strangles us financially, reducing disposable income and the amount of money you can save. So come up with a workable plan to get rid of your debt.

Rank your debts in the order in which you want to pay them off. Paying off the smaller credit card or loan first gives you the satisfaction of crossing one off your list and building momentum. Or you could pay off the debts with the highest interest rates first, such as credit cards. Getting high-interest debt paid off as soon as possible saves you the most money in the long run.

Focus on paying off one debt at a time, allocating the extra money saved from restructuring your budget to the first debt you try to eliminate. When you focus on paying off one debt at a time, you are able to pay off the debt faster because more of the money will go directly to the principal balance and less will be spent paying interest.


3. Prioritize saving money

Things we can’t control tend to worry us. Knowing what you can control and taking appropriate action can reduce your stress. A good example of taking advantage of what you can control is sticking to a consistent savings plan. Saving will give you a sense of accomplishment and comfort. As you accumulate savings, you’ll know the money is set aside in case you need it.

It is important to understand this: paying off your debt, and eventually eliminating it, will have a direct impact on the amount and quality of your savings in the short and long term. Everyone needs an emergency fund. Ideally, if you have the money and the discipline, you will develop a two-pronged savings approach that puts money into an emergency savings account every two weeks and into a long-term savings account. term, such as an IRA, 401(k) or high-yield savings account.

Once you’ve built up your emergency fund significantly, you can consider putting some of it in a certificate of deposit, which offers a guaranteed rate of return that’s typically higher than traditional savings accounts.

Financial stress can seem overwhelming and unmanageable if you have no measures in place. Keep it simple, be honest about what’s causing the stress, and stay positive knowing that making small changes here and there can make big differences over time.


The content of 30Seconds.com is for informational and entertainment purposes only and should not be considered financial advice. Any views or opinions expressed on 30Seconds.com do not necessarily represent those of 30Seconds or any of its employees, partners or affiliates.


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Best Installment Loans of 2022 – Forbes Advisor https://i69texas.org/best-installment-loans-of-2022-forbes-advisor/ Tue, 05 Jul 2022 21:11:00 +0000 https://i69texas.org/best-installment-loans-of-2022-forbes-advisor/ Upgrade was launched in 2017 and provides online and mobile banking and credit services accessible in all states except Iowa, Vermont and West Virginia. Since then, the platform has made more than $3 billion in credit available to more than 10 million applicants and continues to expand its online and mobile services. Although maximum APRs […]]]>

Upgrade was launched in 2017 and provides online and mobile banking and credit services accessible in all states except Iowa, Vermont and West Virginia. Since then, the platform has made more than $3 billion in credit available to more than 10 million applicants and continues to expand its online and mobile services. Although maximum APRs are high compared to other online lenders, Upgrade makes loans available to those with poor credit history.

Loan amounts, which start at just $1,000, are flexible but cap out at $35,000, less than lenders who focus on low-risk borrowers. Three and five year loan terms are available. Upgrade charges an origination fee of between 2.9% and 8% of the loan, and borrowers will incur a $10 fee if their payment is more than 15 days late or payment is not made; there is no discount for automatic payment. That said, upgrade borrowers aren’t subject to a prepayment penalty, so you can reduce the overall cost of the loan if you’re able to pay it off sooner.

In addition to offering accessible personal loans, Upgrade streamlines the loan process with a mobile app that lets borrowers view their balances, make payments, and update their personal information. Upgrade’s Credit Heath tool also makes it easy to track your credit score throughout the life of your loan.

Eligibility: Prospective borrowers must have a minimum score of 580 to be eligible for an upgrade personal loan (the average borrower score is 697), making it an accessible option for those with fair credit. Additionally, the lender does not require applicants to meet a minimum income requirement, although borrowers earn an average of $95,000 per year. Applicants must have a maximum pre-loan debt ratio of 45%, excluding their mortgage.

The lender also considers each applicant’s free cash flow, which demonstrates their likely ability to make regular, on-time loan repayments. Ideally, applicants should have a minimum monthly cash flow of $800.

The upgrade increases loan accessibility by allowing co-applicants as well.

The loan uses: Like most other personal loans, Upgrade loans should be used to pay off credit cards, consolidate other debts, make home improvements, or pay for other major purchases. However, Upgrade differs from some lenders by allowing borrowers to use personal loan funds to cover business expenses. Additionally, Upgrade will repay third-party lenders directly, making debt consolidation more convenient than with some competing lenders.

There are no specific prohibitions on the use of Upgrade Loans other than those already imposed by law.

Completion time : Once an upgrade loan is approved, it typically takes up to four business days for a borrower to receive the funds. However, if Upgrade repays a borrower’s loans directly to a third-party lender, it can take up to two weeks for the funds to clear.

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Why your paycheck arrives early at some financial institutions – Marketplace https://i69texas.org/why-your-paycheck-arrives-early-at-some-financial-institutions-marketplace/ Fri, 01 Jul 2022 21:58:01 +0000 https://i69texas.org/why-your-paycheck-arrives-early-at-some-financial-institutions-marketplace/ This is just one of the stories in our “I’ve Always Wondered” series, where we tackle all your business questions, big or small. Have you ever wondered if recycling is worth it? Or how store brands pile up against brand names? Discover more of the series here. Marketplace listener and reader Ann Kirby-Payne from New […]]]>

This is just one of the stories in our “I’ve Always Wondered” series, where we tackle all your business questions, big or small. Have you ever wondered if recycling is worth it? Or how store brands pile up against brand names? Discover more of the series here.


Marketplace listener and reader Ann Kirby-Payne from New York asks:

Each week, my paycheck direct deposit is split between two accounts. Payday is technically Friday, and the portion that is deposited in my major national bank is paid into the account in the early hours of the morning. But the money that goes to my local credit union is posted 24 hours earlier, sometimes even earlier. What is the problem? Does Big National Bank earn extra interest on the overnight deposit, or does Local Credit Union give me an overnight loan? And in both cases, how does this difference affect the global economy across millions of deposits?

For some of us who woke up that Friday morning, our paychecks landed in our bank accounts in the early hours of the day.

But for others, those paychecks arrived days earlier.

Credit unions aren’t the only institutions releasing payday funds earlier than expected — major banks such as Capital One are offering a one-to-two-day advance on paychecks to attract new customerswhile Wells Fargo plans to offer the service Later this year.

Financial institutions offer it as a perk to attract or retain customers, said Glenn Migliozzi, professor of finance at Babson College in Massachusetts.

Migliozzi said advance deposits could help lower overdraft fees, an idea banks like Well Fargo are using as a selling point.

How is it possible to get your funds two days earlier?

“Each direct deposit payment has an official payment date. So that’s the date the employer intends to make the payment,” said Michael Herd, senior vice president of Nacha’s Automated Clearinghouse Network (formerly known as National Automated Clearing House Association). “An employer will typically send a direct deposit payroll file one or two days before payday” to the employer’s bank.

This payment file will then go through the automated clearing house system, a network that processes electronic payments.

“The ACH system sorts and sends each of the individual direct deposit payments to the correct bank or credit union where each employee has their account,” Herd said. “That’s how the payments get to their destination.”

Then, Herd explained, there’s a separate process known as “settlement.”

“Settlement is when the system accounts for the movement of money between all financial institutions,” he noted.

He said settlement of most clearing house payments typically occurs at 8:30 a.m. Eastern time on payday, and that the funds must be made available to the employee at no later than 9 a.m. by Nacha’s rules.

So for people who had a direct deposit scheduled today, the transaction almost certainly settled between employer and employee by 8:30 a.m., he said.

“It’s literally when the receiving institution, bank or credit union is credited with receiving the money,” Herd said.

Financial institutions do not earn overnight interest on paycheck funds that are settled on the standard payday, Herd added, because the funds are only available in the morning. So when your paycheck is deposited before payday, banks and credit unions advance the funds to you and expect to be reimbursed by 8:30 a.m. settlement time. Herd said he doesn’t consider it an overnight loan.

Herd said financial institutions think it’s “worth the risk” to advance those funds, and that the possibility of the money not being settled is more of a hypothetical possibility.

“The settlement of these payments is routine. This happens several times during the day. And we haven’t had any recent history where there’s been a problem where that’s not happening,” he said. “I think banks and credit unions feel very comfortable.”

What this means for the economy as a whole

Migliozzi said the early availability of your paycheck could negatively impact payday lenders, which consumer advocates view as predatory because they offer short-term loans with high interest rates.

However, neither Migliozzi nor Herd think the early availability of paychecks is having a widespread effect on the economy.

“The next credit is always in seven, 14 or 30 days depending on the pay cycle. So the only advantage is the first two to three days,” Migliozzi said.

And on an individual basis, some people benefit from previous deposits.

Listener and reader Kirby-Payne said there were times when money was tight because she and her spouse were paying for their child’s school fees, so getting that money early from her credit union gave him “room to manoeuvre”.

“Or more often it gave me the satisfaction of paying a bill a little earlier,” she said.

There’s a lot going on in the world. Through it all, Marketplace is there for you.

You rely on Marketplace to break down world events and tell you how it affects you in a factual and accessible way. We count on your financial support to continue to make this possible.

Your donation today fuels the independent journalism you rely on. For just $5/month, you can help maintain Marketplace so we can keep reporting on the things that matter to you.

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