U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-Q/A

(Mark One)

|X|      Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
         Exchange Act of 1934

         For the Quarterly Period Ended September 30, 2001

                                       or

| |      Transition Report Pursuant to Section 13 or 15(d) of the Securities
         Exchange Act of 1934

         For the Transition Period From _______ to _______.

                       Commission file number __________


                             THE CREDIT STORE, INC.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)


                     Delaware                          87-0296990
                     --------                          ----------
         (State or other jurisdiction of            (I.R.S. employer
         incorporation or organization)              identification no.)

              3401 North Louise Avenue
              Sioux Falls, South Dakota              57107
              -------------------------              -----
       (Address of principal executive offices)    (Zip code)

                                 (800) 240-1855
--------------------------------------------------------------------------------
                          Registrant's telephone number


                                 Not Applicable
--------------------------------------------------------------------------------
              (Former name, former address and former fiscal year,
                          if changed since last report)

Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing

requirements for the past 90 days. Yes |X|    No | |

State the number of shares outstanding of each of the issuer's classes of common
stock, as of the latest practical date: Common Stock, $.001 par value --
34,851,465 issued and outstanding as of November 1, 2001.




<PAGE>


                                INTRODUCTORY NOTE
                                -----------------

This amendment to Form 10-Q is being filed to restate the interim financial
statements for the quarters ended September 30, 2001 and 2000 to correct an
error in the calculation of the fair market value of the Company's retained
interests in two securitization transactions. The Company is concurrently filing
an amendment to its Form 10-K for the fiscal year ended June 30, 2001, that
includes restated financial statements for fiscal year 2001.

The matters relating to the restatement referenced in the amended fiscal year
2001 Form 10-K have a financial statement impact for the periods covered by this
10-Q as follows:

Quarter ended September 30, 2001
        Revenue - increase by $0.3 million
        Income tax expense - increase by $0.1 million
        Net loss - decrease by $0.1 million
        Retained interest in securitized receivables - decrease by $4.7 million
        Unrealized gain from retained interest in securitized receivables, net
        of tax - decrease by $3.4 million
        Accumulated deficit - increase by $1.3 million
        Total stockholders' equity - decrease by $4.7 million

Quarter ended September 30, 2000
        Income tax benefit - increase by $0.3 million
        Net loss - decrease by $0.3 million
        Net loss per share - decrease by $0.01

At June 30, 2001
        Retained interest in securitized receivables - decrease by $4.1 million
        Unrealized gain from retained interest in securitized receivables, net
        of tax - decrease by $2.7 million
        Accumulated deficit - increase by $1.4 million
        Total stockholders' equity - decrease by $4.1 million

For purposes of this amended Form 10-Q, and in accordance with rule 12b-15 under
the Securities and Exchange Act of 1934, the Company has amended and restated in
its entirety each item of the Company's 10-Q for the quarterly period ended
September 30, 2001 which has been affected by the restatement. This amended Form
10-Q does not reflect events occurring after the filing of the original Form
10-Q, or modify or update those disclosures in any way, except as required to
reflect the effects of this restatement.



                                       2
<PAGE>


THE CREDIT STORE, INC.

                                    FORM 10-Q

                    For the Quarter Ended September 30, 2001

                                      INDEX
<TABLE>
<CAPTION>

                                                                                                         PAGE
                                                                                                         ----
<S>                   <C>                                                                                 <C>
PART I.               FINANCIAL INFORMATION (as restated)

         Item 1.           Condensed Consolidated Financial Statements (Unaudited):

                           Condensed Consolidated Balance Sheets as of September 30, 2001
                           and June 30, 2001                                                              4

                           Condensed Consolidated Statements of Operations
                           for the three months ended September 30, 2001 and
                           September 30, 2000                                                             5

                           Condensed Consolidated Statements of Cash Flows
                           for the three months ended September 30, 2001 and
                           September 30, 2000                                                             6

                           Notes to Condensed Consolidated Financial Statements                           7

         Item 2.           Management's Discussion and Analysis of Financial Condition
                           and Results of Operations                                                     11


SIGNATURES                                                                                               16
</TABLE>


                                       3
<PAGE>


                          PART I. FINANCIAL INFORMATION

               ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                             THE CREDIT STORE, INC.

                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                                   September 30,            June 30,
                                                                                      2001                    2001
                                                                                    Restated                Restated
                                                                                  ------------            ------------
                                            ASSETS
<S>                                                                               <C>                     <C>
Cash and cash equivalents                                                         $  1,936,858            $  1,853,454
Restricted cash                                                                      1,000,000               1,250,000
Accounts and notes receivable, net                                                   7,024,745               5,392,845
Prepaid expenses                                                                     1,068,344               1,073,283
Amounts due from special purpose entities                                              715,096                 617,737
Investments in receivable portfolios, net                                           28,863,464              32,948,042
Investment in unconsolidated affiliates                                                983,245               1,000,750
Retained interest in securitized receivables                                         8,568,628               7,249,204
Property and equipment, net of accumulated depreciation                              5,213,361               5,512,853
Goodwill, net                                                                        2,123,558               2,123,558
Deferred tax                                                                         2,700,000               2,700,000
Other assets                                                                           989,939                 985,931
                                                                                  ------------            ------------

                Total assets                                                      $ 61,187,248            $ 62,707,657
                                                                                  ============            ============

                LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES

Accounts payable and accrued expenses                                             $  7,590,398            $  7,537,895
Notes payable                                                                       22,852,340              23,186,134
Capitalized lease obligations                                                        3,941,178               4,247,093
Subordinated notes and accrued interest payable -
  related party                                                                     19,606,366              19,970,834
                                                                                  ------------            ------------

                Total liabilities                                                   53,990,282              54,941,956
                                                                                  ------------            ------------

STOCKHOLDERS' EQUITY

Preferred Stock, Series A, B, C, D and E                                            27,000,000              27,000,000
Common Stock, $.001 par value, 65,000,000 authorized, 34,851,465
  outstanding at September 30, 2001 and June 30, 2001                                   34,851                  34,851
Additional paid-in capital                                                          23,972,421              23,972,421
Unrealized gain from retained interest in securitized
  receivables, net of tax                                                            1,540,204               1,603,350
Accumulated deficit                                                                (45,350,510)            (44,844,921)
                                                                                  ------------            ------------

                Total stockholders' equity                                           7,196,966               7,765,701
                                                                                  ------------            ------------
                Total liabilities and stockholders' equity                        $ 61,187,248            $ 62,707,657
                                                                                  ============            ============
</TABLE>

The accompanying notes are an integral part of these statements.


                                       4
<PAGE>

                             THE CREDIT STORE, INC.

                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)
<TABLE>
<CAPTION>
                                                                               Three Months Ended
                                                                               ------------------
                                                                      September 30,            September 30,
                                                                          2001                     2000
                                                                        Restated                  Restated
                                                                      ------------              ------------
<S>                                                                   <C>                       <C>
Revenue
    Income from investment in receivable portfolios                   $  7,509,049              $ 10,237,502
    Securitization income and asset sales                                1,340,709                   453,075
    Servicing fees and other income                                      2,648,892                   748,516
                                                                      ------------              ------------
        Total revenue                                                   11,498,650                11,439,093

    Provision for losses                                                (3,297,043)               (2,262,139)
                                                                      ------------              ------------

               Net revenue                                               8,201,607                 9,176,954
                                                                      ------------              ------------

Expenses
    Salaries and employee benefits                                       3,296,337                 3,564,078
    Professional and financing fees                                        773,507                   894,217
    Credit card servicing                                                1,678,300                 2,232,411
    Occupancy and equipment expense                                        878,184                   973,509
    Other                                                                  503,935                 1,797,075
                                                                      ------------              ------------

               Total expenses                                            7,130,263                 9,461,290
                                                                      ------------              ------------

Operating income (loss)                                                  1,071,344                  (284,336)

Interest expense                                                         1,433,168                 1,345,904
                                                                      ------------              ------------

Loss before income taxes                                                  (361,824)               (1,630,240)

Income tax (expense) benefit                                              (143,765)                  301,577
                                                                      ------------              ------------

Net loss                                                                  (505,589)               (1,328,663)

Dividends on preferred stock                                              (500,000)                 (500,000)
                                                                      ------------              ------------

Net loss, applicable to
   common shareholders                                                $ (1,005,589)             $ (1,828,663)
                                                                      ============              ============

Net loss per share
    Basic                                                             $       (.03)             $       (.05)
                                                                      ============              ============

    Diluted                                                           $       (.03)             $       (.05)
                                                                      ============              ============

Weighted-average common shares outstanding
    Basic                                                               34,851,465                34,798,318
                                                                      ============              ============

    Diluted                                                             34,851,465                34,798,318
                                                                      ============              ============
</TABLE>


The accompanying notes are an integral part of these statements.


                                       5
<PAGE>


                             THE CREDIT STORE, INC.

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)
<TABLE>
<CAPTION>
                                                                                           Three Months Ended
                                                                                           ------------------
                                                                                  September 30,          September 30,
                                                                                     2001                   2000
                                                                                   Restated               Restated
                                                                                  -----------            -----------
<S>                                                                               <C>                    <C>
Cash flows from operating activities:
   Net loss                                                                       $  (505,589)           $(1,328,663)
   Adjustments to reconcile net loss to
      net cash provided by (used in) operating activities -
     Provision for credit card losses                                               3,297,043              2,262,139
     Amortization of receivable portfolios discount                                (4,801,920)            (4,760,041)
     Depreciation and amortization                                                    471,727                497,935
     Amortization of retained interest in securitized credit cards                 (1,190,179)                    --
     Loss from unconsolidated affiliates                                              (16,726)               (21,690)
     Gain on sale of portfolios and retained interests                               (219,491)              (365,543)
     Tax expense                                                                      143,765               (301,577)
     Other                                                                                 --                  4,506
     Change in operating assets and liabilities                                    (1,735,858)             4,856,763
                                                                                  -----------            -----------
             Net cash provided by (used in)
                operating activities                                               (4,557,228)               843,829
                                                                                  -----------            -----------

Cash flows from investing activities:
   Collection of consumer debt and funds advanced                                   7,526,614              8,691,827
   Retained interest in securitized credit card receivables                          (680,752)              (157,170)
   Funds advanced on credit cards                                                  (5,189,071)            (7,142,476)
   Purchase of non-performing consumer debt portfolios                               (110,015)            (2,767,869)
   Proceeds from sale of portfolios                                                 3,871,203                365,543
   Acquisition of property and equipment                                             (171,869)              (386,197)
                                                                                  -----------            -----------

           Net cash provided by (used in)
             investing activities                                                   5,246,110             (1,396,342)
                                                                                  -----------            -----------

Cash flows from financing activities:
   Net proceeds (payments) from debt                                                 (333,794)               478,462
   Borrowings from capital leases                                                     187,463                171,862
   Payments on capital lease obligations                                             (493,378)              (354,733)
   Partner distributions from unconsolidated affiliates                                34,231                 91,036
   Proceeds from exercises of stock options                                                --                202,300
                                                                                  -----------            -----------

           Net cash provided by (used in)
             financing activities                                                    (605,478)               588,927
                                                                                  -----------            -----------

           Net increase in cash and cash equivalents                                   83,404                 36,414

Cash and cash equivalents at beginning of period                                    1,853,454              2,236,630
                                                                                  -----------            -----------

Cash and cash equivalents at end of period                                        $ 1,936,858            $ 2,273,044
                                                                                  ===========            ===========
</TABLE>

The accompanying notes are an integral part of these statements.



                                       6
<PAGE>

                             THE CREDIT STORE, INC.

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

NOTE A - ORGANIZATION

The Credit Store (the "Company") is a technology and information based financial
services company that provides credit card products to consumers who may
otherwise fail to qualify for a traditional unsecured bank credit card. Unlike
traditional credit card companies, the Company focuses on consumers who have
previously defaulted on debt. The Company reaches these consumers by acquiring
their defaulted debt. Through direct mail and telemarketing operations, these
consumers are offered an opportunity to settle their debt, typically at a
discount, transfer the agreed settlement amount to a newly issued unsecured
MasterCard(R) or Visa(R) credit card, and establish a positive credit history on
their newly issued card by making timely and consistent payments. The Company
accepts lump sum settlements or installment payment plans from those consumers
who do not accept the credit card offer.

The Company has five subsidiaries, Credit Store Services, Inc., Credit Store
Capital Corp., American Card Alliance, Inc., TCS Funding IV, Inc., and TCS
Funding V, Inc. These subsidiaries are wholly owned by the Company; however,
only Credit Store Capital Corp. and American Credit Alliance, Inc. are
consolidated in the enclosed financial statements. Credit Store Services, Inc.
and Credit Store Capital Corp. acquire non-performing consumer receivables and
contract with the Company to offer consumers a credit card under the Company's
program or to accept settlements or payment plans. See Note F - Securitization
of Receivable Portfolios. American Credit Alliance owns a 50% interest in Dakota
Card Fund II, LLC, a limited liability company that contracts with the Company
to service non-performing receivables and credit card receivables that it owns.
TCS Funding IV, Inc. and TCS Funding V, Inc. were established for the purpose of
purchasing performing credit card receivables from the Company. See Note F -
Securitization of Receivable Portfolios.


NOTE B - BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements have been
prepared pursuant to the rules and regulations of the Securities and Exchange
Commission. Certain information and footnote disclosures normally included in
financial statements prepared in accordance with accounting principles generally
accepted in the United States of America have been condensed or omitted pursuant
to such rules and regulations, although management believes that the disclosures
are adequate to make the information presented not misleading. These financial
statements and notes thereto should be read in conjunction with financial
statements and notes thereto included in the Company's audited consolidated
financial statements for the year ended June 30, 2001 contained in the Company's
amended Annual Report on Form 10-K for the year ended June 30, 2001.

Preparation of the Company's consolidated financial statements requires
management to make estimates and assumptions that affect reported amounts of
assets and liabilities and related revenues and expenses. Actual results could
differ from the estimates used by management.

In the opinion of management, the unaudited condensed consolidated financial
statements contain all adjustments (consisting of only normal recurring
adjustments) necessary to present fairly the financial position as of September
30, 2001, the results of operations for the three months ended September 30,
2001 and September 30, 2000 and cash flows for the three months ended September
30, 2001 and September 30, 2000. The results of operations for the three months
ended September 30, 2001 are not necessarily indicative of the results for the
full year.


NOTE C - FINANCIAL RESTATEMENT

Subsequent to June 30, 2001, and prior to the filing of this amended Form 10-Q
as of and for the six months ended December 31, 2001, the Company discovered an
error in its calculation of the fair market value of its retained interests in
two securitization transactions, resulting in an overstatement of assets,
unrealized gain from retained interests in securitized credit card receivables
and the resulting income tax benefit at June 30, 2001 which resulted in an



                                       7
<PAGE>

understatement of accumulated deficit. The adjustments result in a write down to
the June 30, 2001 fair market valuation of the retained interests of $4.1
million, a reduction of the unrealized gain from retained interests in
securitized credit card receivables recorded within other comprehensive income
net of income tax of $2.7 million, and a reduction in income tax benefit of $1.4
million. These adjustments increased accumulated deficit by $4.1 million. The
adjustment did not impact operating earnings or cash flows for fiscal 2001.

For the three months ended September 30, 2001, the restatement increases net
revenue by $0.3 million and income tax expense by $0.1 million and decreases net
loss by $0.1 million. These changes resulted in no change to net loss per share
for the period. The restatement resulted in a decrease of $4.7 million in
retained interest in securitized receivables, net of tax, and a $1.3 million
increase in accumulated deficit as of September 30, 2001.

The restatement does not impact the loss before income taxes for the three
months ended September 30, 2000. Income tax benefit has increased and net loss
has decreased $0.3 million for the same period. Net loss per share has decreased
by $0.01 for the three months ended September 30, 2000.

The changes to income tax expense/benefit are related to changes in the
Company's other comprehensive income and are offset by equal amounts of tax
expense/benefit, which is recorded in other comprehensive income.


NOTE D - NET LOSS PER SHARE

The Company's basic net loss per share is computed by dividing net loss
applicable to common stockholders by the weighted average number of common
shares outstanding during the period. Net loss applicable to common stockholders
is computed by deducting or adding dividends on preferred stock from net income
or net loss, respectively. The Company's diluted net loss per share is computed
by dividing net loss by the weighted average number of outstanding common shares
and common share equivalents relating to stock options, when dilutive.


NOTE E - ACCOUNTING METHOD CHANGE FOR GOODWILL AND INTANGIBLE ASSETS

On July 20, 2001, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards ("SFAS") 141, Business Combinations, and SFAS
142, Goodwill and Intangible Assets. SFAS 141 is effective for all business
combinations completed after June 30, 2001. SFAS 142 is effective for fiscal
years beginning after December 15, 2001. Major provisions of these Statements
and their effective dates for the Company are as follows:

     o    all business combinations initiated after June 30, 2001 must use the
          purchase method of accounting. The pooling of interest method of
          accounting is prohibited except for transactions initiated before July
          1, 2001.

     o    intangible assets acquired in a business combination must be recorded
          separately from goodwill if they arise from contractual or other legal
          rights or are separable from the acquired entity and can be sold,
          transferred, licensed, rented or exchanged, either individually or as
          part of a related contract, asset or liability.

     o    goodwill, as well as intangible assets with indefinite lives, acquired
          after June 30, 2001, will not be amortized. Effective July 1, 2001,
          all previously recognized goodwill and intangible assets with
          indefinite lives will no longer be subject to amortization.

     o    effective July 1, 2001, goodwill and intangible assets with indefinite
          lives will be tested for impairment annually and whenever there is an
          impairment indicated, an impairment loss will be recognized

The Company adopted the provisions of SFAS 142 as of July 1, 2001. Therefore,
acquired goodwill is no longer amortized. The Company has determined its
goodwill relates to one reporting unit for purposes of impairment testing and
expects to complete a transitional fair value based impairment test of goodwill
by December 31, 2001.


NOTE F - SECURITIZATION OF RECEIVABLE PORTFOLIOS

During the fiscal year ended June 30, 2001, the Company established a new
wholly-owned qualified special purpose entity (SPE), TCS Funding V, Inc. ("TCS



                                       8
<PAGE>

V"), for the purpose of purchasing performing credit card receivables from the
Company. The initial $4.9 million sale of credit card receivables to TCS V
included receivables with a principal balance of approximately $5.7 million. TCS
V entered into a $4.0 million credit facility with a lending institution to
finance the purchase of credit card receivables. The remaining $0.9 million of
the sale was recorded as a retained interest.

During October 2000, the Company established a new wholly-owned qualified SPE,
Credit Store Services, Inc. (CSSI), for the purpose of purchasing non-performing
consumer debt portfolios from the Company. The Company contracts with CSSI to
offer consumers credit cards under the Company's program or to accept
settlements or payment plans. Non-performing consumer debt portfolio sales to
CSSI are equal to the Company's book value. CSSI entered into a $25.0 million
credit facility with a lending institution to finance a portion of acquired
portfolios at the lender's discretion, which facility expires in October 2003.
During the three months ended September 30, 2001, the Company sold approximately
$277.1 million of face value of non-performing receivables at a sales price of
$5.9 million to CSSI in which the Company retained an interest of $0.3 million.
As of September 30, 2001, the outstanding balance under CSSI's credit facility
was $12.7 million, with $12.3 million available for future borrowings at the
lender's discretion. The terms of the credit facility also provide that a
percentage of the future cash flow of the purchased accounts be paid to the
lender after the payment of principal and interest for amounts borrowed.

The Company has a wholly-owned qualified SPE, TCS Funding IV, Inc. ("TCS IV"),
for the purpose of purchasing performing credit card receivables from the
Company. TCS IV has a $40.0 million credit facility with a lending institution
to finance the purchase of credit card receivables. The initial sale of credit
card receivables to TCS IV was for approximately $12.1 million. TCS IV provided
$10.0 million of the purchase price and the remaining approximately $2.1 million
was recorded as retained interest by the Company. The unrealized gain of
approximately $638 thousand, included in the retained interest, was recorded net
of tax as a separate component of stockholders equity. Subsequent to the initial
sales, TCS IV purchased additional performing credit card receivables from the
Company. These transactions are recorded similar to the initial sale. Future
borrowings are at the lender's sole discretion and a number of other conditions.

The following summarizes the changes in the balance of the Company's retained
interest for the three months ended September 30, 2001:
<TABLE>
<CAPTION>
                                                                               Gross           Estimated
                                                            Amortized        unrealized          fair
                                                              cost              gains            value
                                                              ----              -----            -----
<S>                                                         <C>              <C>                <C>
Balance at July 1, 2001                                     $4,817,071       $2,432,133         $7,249,204
Retained interests in portfolios sold                          336,162                -            336,162
Interest accrued                                             1,190,182                -          1,190,182
Change in unrealized gain                                            -        (206,910)          (206,910)
                                                            ----------       ----------         ----------

Balance at September 30, 2001                               $6,343,414       $2,225,223         $8,568,638
                                                            ==========       ==========         ==========
</TABLE>

As of September 30, 2001, the gross net unrealized gain has been offset by a
deferred tax expense of approximately $0.7 million resulting in a net unrealized
gain of approximately $1.5 million.


NOTE G - COMMITMENTS AND CONTINGENCIES

The Company, in the ordinary course of business, receives notices of consumer
complaints from regulatory agencies and is named as a defendant in legal actions
filed by those who have been solicited to participate in its credit card
programs. Currently pending against the Company are: (i) three class action
lawsuits and (ii) one suit concerning a Development Agreement. We have been
informed by O. Pappalimberis Trust that they intend to file suit against the
Company alleging breach of a Development Agreement. The Development Agreements
are discussed in Note H. The Company does not believe that pending litigation
and regulatory complaints involving the Company will have a material adverse
effect on the consolidated financial position and results of operations.
However, a significant judgment against the Company in one or more of the
lawsuits could subject the Company to a monetary judgment and/or require the
Company to modify its methods of operation, either of which could have a
material adverse effect on the Company's results of operations or financial
condition.

                                       9
<PAGE>


NOTE H - DEVELOPMENT AGREEMENTS

In October 1996, the Company's predecessor entered into two Mutual Business
Development Agreements ("Development Agreements"), one with O. Pappalimberis
Trust and one with Renaissance Trust I.

The Development Agreements call for a royalty equal to 5% of any newly
established receivable originated or acquired by the Company by way of certain
accounts held which: (i) is delivered to a pre-securitization credit facility,
(ii) becomes a qualifying receivable, or (iii) meets other specified account age
and payment parameters. A qualifying receivable is defined as any converted
account on which the cardholder has made three consecutive payments within
certain time restrictions. In addition, the Development Agreements provide for
royalties equal to 5% of all principal cash collections on specified accounts
that are not converted to credit cards. The total royalty, if earned, payable
under each of the two Development Agreements, after deductions and exclusions,
will not exceed $25 million.

The Development Agreement with the O. Pappalimberis Trust was amended on
September 1, 1998 to alter the amount and timing of payments, give the Company a
buyout option, alternate royalty payment options and extend the term of the
agreement to May 31, 2005. The Development Agreement with Renaissance Trust I
expires October 7, 2002 and has not been amended.

Both Development Agreements are currently in dispute. In February 2001 the
Company discontinued payment of royalties under both Development Agreements.

The Company has been informed by O. Pappalimberis Trust that they intend to file
suit against us alleging breach of the Development Agreement.

On April 23, 2001, the Company was sued by Renaissance Trust I in the United
States District Court for the Southern District of New York in an action titled
Renaissance Trust I v. The Credit Store, Inc. The plaintiffs allege breach of
the Development Agreement and conversion and seek enforcement of the contract,
compensatory damages alleged to be in excess of $5 million, and punitive damages
of $25 million. Renaissance Trust I owns 4,000,000 shares of the Company's
common stock and 400,000 shares of the Company's Series B Preferred Stock. On
June 29, 2001, the Court dismissed the conversion claim and dismissed the demand
for punitive damages.

The Company has estimated that it is probable that a settlement of at least
$2,800,000 will be required to settle the contract disputes and terminate the
agreements. The majority of this amount was accrued during the fourth quarter of
fiscal 2001 and is included in accrued expenses at September 30, 2001, and June
30, 2001.


NOTE I - INVESTMENTS IN RECEIVABLE PORTFOLIOS

The Company acquires portfolios of non-performing consumer debt. These debts are
acquired at a substantial discount from the actual outstanding consumer balance.
The Company's objective is to offer the consumer an opportunity to settle these
debts, typically at a discount, and transfer the settled amount to a newly
issued credit card. Any debt that consumers do not settle remains uncollected by
the Company and may be sold to a third party. The Company expenses origination
costs, including direct mail and telemarketing costs, as incurred.




                                       10
<PAGE>

The following summarizes the components in the balance of the investments in
receivable portfolios for the following periods:
<TABLE>
<CAPTION>

                                                                          September 30,        June 30,
                                                                              2001               2001
                                                                              ----               ----
<S>                                                                        <C>                 <C>
           Cost and accretion                                              $6,868,618          $9,281,048
                                                                           ----------          ----------

           Principal funded on new advances and purchases                 $27,156,536         $27,456,560
           Accrued interest on principal funded                               266,100             376,749
           Accrued fees                                                       257,259             339,517
                                                                              -------             -------

                                                                           27,679,895          28,172,826
                                                                           ----------          ----------

           Less
           Provision for losses on credit card receivables                  5,084,429           3,856,882
           Unearned fees                                                      600,620             648,950
                                                                              -------             -------

                                                                            5,685,049           4,505,832
                                                                            ---------           ---------

           Investments in receivable portfolios                           $28,863,464         $32,948,042
                                                                          ===========         ===========

           Total credit card balances (1)                                 $52,552,715         $66,184,418
                                                                          ===========         ===========

           Available credit (2)                                            $7,087,491          $9,355,862
                                                                           ==========          ==========
</TABLE>

(1) Total credit card balances above represent the total amount owed to the
Company by the cardholders through initial settlement, new charges, interest,
fees and payments.

(2) Available credit represents the amount that the Company would be obligated
to fund if the credit cards were fully utilized by the cardholders.


                             THE CREDIT STORE, INC.

The information presented below in Management's Discussion and Analysis of
Financial Condition and Results of Operations contains forward-looking
statements within the meaning of the safe harbor provisions of Section 21E of
the Securities Exchange Act of 1934, as amended. Such statements are subject to
risks and uncertainties, including those discussed under "Disclosure Regarding
Forward-Looking Statements" below, that could cause actual results to differ
materially from those projected. Because actual results may differ, readers are
cautioned not to place undue reliance on these forward-looking statements. We
assume no obligation to publicly release the results of any revisions or updates
to these forward-looking statements to reflect future events or unanticipated
occurrences.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.

                                    OVERVIEW

The Credit Store, Inc. is a technology and information based, financial services
company that provides credit card products to consumers who may otherwise fail
to qualify for a traditional unsecured bank credit card. We reach consumers by
acquiring their defaulted debt. We acquire portfolios of non-performing consumer
receivables and offer a new credit card to those consumers who agree to pay all
or a portion of the outstanding amount due on their debt and who meet our



                                       11
<PAGE>

underwriting guidelines. The new card is issued with an initial balance and
credit line equal to the agreed repayment amount. We accept lump sum settlements
and installment payment plans from those consumers who do not accept the credit
card offer. After six or more on-time payments have been made on a consumer's
outstanding credit card balance we consider the account seasoned and available
to sell or securitize. Because the focus of our business is to convert defaulted
debt into seasoned credit cards, we periodically sell or securitize portfolios
of these seasoned accounts. We also periodically sell into the secondary market
for non-performing consumer debt portfolios of accounts we acquired but were
unable to convert.

RESULTS OF OPERATIONS

THREE MONTHS ENDED SEPTEMBER 30, 2001 COMPARED TO THREE MONTHS ENDED SEPTEMBER
30, 2000:

REVENUES. Total revenue for the three months ended September 30, 2001 was $11.5
million, a 0.5% increase from the $11.4 million recorded during the three months
ended September 30, 2000. Core revenues (income from all activities other than
portfolio sales and interest in affiliate revenues) increased 1.8% from $11.1
million in the first quarter of fiscal 2001 to $11.3 million in the first
quarter of fiscal 2002. While core revenues were stable, the mix of core
revenues changed due to the majority of new credit card accounts being
originated in our unconsolidated subsidiary, Credit Store Services, Inc.
("CSSI"), a wholly-owned qualified special purpose entity, established by us in
July 2000 and which began booking accounts in the second quarter of fiscal 2001.
Period to period new originations of credit card accounts declined from $27.6
million during the first quarter of fiscal 2001 to $20.0 million during the
first quarter of fiscal 2002. $17.3 million of the new accounts originated in
the first quarter of fiscal 2002 were booked in CSSI. This has the impact of
increasing servicing revenue and reducing income from investment in receivables
portfolios. Gains on sales of portfolios have decreased from $0.4 million in the
first quarter of fiscal 2001 to $0.2 million in the first quarter of fiscal
2002. Servicing fees and other income has increased 253.9% from $0.7 million in
the first quarter of fiscal 2001 to $2.6 million in the first quarter of fiscal
2002. This increase reflects the increased number of accounts serviced by us for
third parties and unconsolidated subsidiaries formed in connection with
securitizations, including CSSI.

Net revenue decreased to $8.2 million in the first quarter of fiscal 2002 from
$9.2 million in the first quarter of fiscal 2001 primarily due to an increase in
the provision for losses. The provision reported for the first quarter of fiscal
2002 and 2001 was $3.3 million and $2.3 million, 29.2% and 20.4% of core
revenues. The provision for losses increased as a result of accrual accounting,
which increases the percentage of our credit card receivables that are now on
the balance sheet. Our investments in receivables was 44% of total credit card
balances at September 30, 2000 versus 59% at September 30, 2001. The
relationship of investment in receivables to our credit card balances generally
has a direct correlation to the provision of losses as a percentage of core
revenues.

EXPENSES. Total operating expenses for the first quarter of fiscal 2002 were
$7.1 million, a 24.6% decrease from $9.5 million in the first quarter of fiscal
2001. Operating expenses were 62.8% and 85.4% of core revenues in the first
quarter of fiscal 2002 and 2001. The decrease in operating expenses and
operating expenses as a percentage of core revenues reflects the reduction in
royalty payments and our ability to increase the number of accounts owned and
managed while creating efficiencies in our operations. We experienced a 5.8%
increase in the aggregate balance of credit card receivables we owned and
managed from $113.4 million as of September 30, 2000 to $120.0 million as of
September 30, 2001.

Salaries and employee benefits decreased 7.5% in the first quarter of fiscal
2002 compared to the first quarter of fiscal 2001, and decreased as a percentage
of core revenue from 32.2% in 2001 to 29.2% in 2002. This decrease is mainly due
to our reduction of personnel from 323 at September 30, 2000 to 262 at September
30, 2001 which we were able to accomplish because of technology and system
enhancements.

Professional and financing fees decreased 13.5% from $0.9 million in the first
quarter of fiscal 2001 to $0.8 million in the first quarter of fiscal 2002.
Professional fees decreased in fiscal 2002 primarily due to less legal expenses
paid by us for class action litigations.

Credit card servicing fees (consisting of telephone expense, marketing mailers
cost, postage, and third party credit card services and scrubbing fees)
decreased 24.8% from $2.2 million in the first quarter of fiscal 2001 to $1.7
million in the first quarter of fiscal 2002 and decreased as a percentage of
core revenue from 20.2% to 14.9%. This reduction is partly due to a reduced



                                       12
<PAGE>

volume of receivables acquired by us and CSSI from $404.4 million in the first
quarter of fiscal 2001 to $329.9 million in the first quarter of fiscal 2002,
but primarily is due to processing efficiencies which lowered our cost per
account.

Other expenses declined primarily due to our decision to discontinue the accrual
of payments on two mutual business development agreements after November 2000.
$1.1 million of payments were expensed in the first quarter of fiscal 2001. The
mutual business development agreements are currently in dispute. See "Legal
Proceedings". As of September 30, 2001, we have accrued $2.8 million in total,
which is our estimate of the amount required to settle the contract disputes and
to terminate the agreements.

INTEREST EXPENSE. Interest expense remained fairly constant at $1.4 million in
the first quarter of fiscal 2002, a 6.5% increase from $1.3 million in the first
quarter of fiscal 2001. Interest expense, as a percentage of core revenue, was
12.2% in the first quarter of fiscal 2001 and increased slightly to 12.7% in the
first quarter of fiscal 2002.

INCOME TAX EXPENSE/BENEFIT. Income tax expense or benefit was recorded in the
first quarter of 2002 and 2001, respectively. These amounts related to changes
in the Company's other comprehensive income and are offset by equal amounts of
income tax expense or income tax benefit which is recorded in other
comprehensive income. Income tax benefits relating to losses before income taxes
of $123,000 and $554,000 in the first quarter of fiscal 2002 and 2001 have been
offset by valuation allowances of the same amounts. We will continue to evaluate
the valuation allowance and will recognize tax benefits as factors indicate that
it is more likely than not that additional future tax benefits will be realized.

NET LOSS. Net loss was $0.5 million in the first quarter of fiscal 2002 compared
to $1.3 million in the first quarter of fiscal 2001. Dividends on preferred
stock have accumulated but have not been declared and are not yet payable.
However, we treat the dividends as declared and payable for the purpose of
calculating net loss applicable to common shareholders. After the effect of
preferred dividends of $0.5 million in each of the first fiscal quarters, the
net loss applicable to common shareholders was $1.0 million, or $0.03 per basic
and diluted common share, in fiscal 2002; and $1.8 million, or $.05 per basic
and diluted common share, in fiscal 2001.

                         LIQUIDITY AND CAPITAL RESOURCES

We seek to maintain an adequate level of liquidity through active management of
assets and liabilities, through sales or securitizations of credit card
receivables, and through debt and equity financing. Because the characteristics
of our assets and liabilities change, liquidity management is a dynamic process
affected significantly by the maturity of our assets and the seasonality of the
credit card business.

At September 30, 2001, we had $2.9 million of cash and cash equivalents,
compared to $3.1 million at June 30, 2001. We maintain restricted cash reserves
at our banks to facilitate the funding of new charges and advances on our
customer's credit cards. These restricted balances were $1.0 million at
September 30, 2001 and $1.3 million at June 30, 2001. This decrease was due to
the required restricted cash balance decreasing $250,000 in July 2001.

We maintain a senior secured revolving credit line with Coast Business Credit
("Coast"), a division of Southern Pacific Bank. The maximum amount available
under the credit line was $13.0 million at September 30, 2001. The credit line
is secured by substantially all of our assets. Borrowings under the credit line
are based on a formula, which is dependent primarily on the performance and
maturity of our credit card receivables. The credit facility currently has an
expiration date of, and the outstanding balance matures on, July 31, 2002. By
October 31, 2001, the maximum amount available under the credit line must be
reduced to the lesser of $11.5 million or $13.0 million minus 60% of net cash
proceeds derived by us from sales or securitizations of credit card portfolios
between September 28, 2001, and October 31, 2001 and thereafter, will continue
to be further reduced by 60% of the net cash proceeds derived by us from the
sales or securitization of credit card portfolios concluded after October 31,
2001. There was $12.6 million outstanding under the credit line at September 30,
2001.

We have also received secured financing from a related party, J.L.B. of Nevada.
The notes are payable on demand but are subordinated to the senior secured
revolving credit line. The principal amount outstanding on these notes totaled



                                       13
<PAGE>

$17.3 million and accrued but unpaid interest totaled $2.3 million at September
30, 2001. No payments of interest are required until at least May 4, 2002 if JLB
of Nevada holds the notes. A subsequent holder may demand payment of up to 20%
of the accrued interest, if any, prior to May 4, 2002.

In October 1999, through a bankruptcy remote special purpose entity, we
established a $17.5 million secured revolving credit line with General Electric
Capital Corporation to finance the acquisition of non-performing consumer debt
portfolios, which credit line expires in August 2002. Borrowings are
non-recourse to us and borrowings availability is based on the age of the
non-performing consumer debt portfolios acquired by us coupled with contracts
that the subsidiary enters into to resell portfolios to other debt buyers. There
was $1.7 million outstanding under the credit line at September 30, 2001 with
$0.5 million available for future borrowings. The special purpose entity is
consolidated into our financial statements.

On November 30, 2000 we entered into a credit card receivables repurchase
agreement with Plains Commerce Bank. Under the agreement, Plains Commerce Bank
purchased credit card receivables from us for $8.0 million. Our option to
repurchase the receivables expires on January 4, 2002. In September 2001, we
entered into a credit card receivables repurchase agreement with North
Divisions, Associates whereby the lender purchased credit card receivables from
us for $0.5 million. The repurchase agreement expires July 31, 2002. For
financial statement purposes, we treat these repurchase agreements as financing
transactions.

Our wholly-owned qualified special purpose entity, TCS Funding IV, has a $40.0
million credit facility with a lending institution to finance the purchase of
credit card receivables. On May 31, 2000, $10.0 million of the facility was used
to purchase credit card receivables with a principal balance of $14.2 million at
a purchase price of $12.1 million. We recorded the balance of the sale price,
$2.1 million, as a retained interest. Future borrowings under the facility are
subject to the lender's discretion and a number of other conditions. Until
December 1, 2001, the credit facility requires payments of interest only. After
December 1, 2001, the TCS Funding IV credit facility requires that all cash
collections received relating to the senior debt interest in the receivables be
used to repay principal, after payment-related servicing fees and interest are
paid. All new charges on the sold accounts are funded by us and contributed in
exchange for a retained interest until such time as the senior debt interest is
paid down. We are in discussions with the lender to extend the interest only
period through March 2002 to allow us time to refinance the debt or arrange for
the sale of the accounts. If we do not refinance the receivables, extend the
revolving period, or sell the receivables in a portfolio sale, our funding
requirements on new receivables will increase.

During July 2000, we established Credit Store Services, Inc ("CSSI"), a
wholly-owned qualified special purpose entity. During October 2000, CSSI entered
into a financing relationship with The Varde Fund IV-A, L.P. ("Varde") involving
CSSI's purchase of non-performing consumer debt portfolios from us. We sell the
non-performing debt portfolios to CSSI on the same date and terms that we
purchase them from third parties at a price equal to our book value, which is
the acquisition price of the portfolio. CSSI entered into a $25.0 million credit
facility with Varde to finance a portion of the purchase price of these
portfolios. Under the facility, Varde finances 95% of the acquisition price of
the non-performing consumer debt portfolios and we finance the remaining 5% of
the acquisition price. Each loan from Varde to CSSI is evidenced by a note, the
principal and interest of which are due twenty-four months after the date of the
note. CSSI pays us all applicable servicing fees in connection with the acquired
portfolios, which fees totaled approximately $1.8 million during the first
quarter of fiscal 2001. In addition, CSSI pays interest on the loans advanced by
Varde and by us. The remainder of the cash flows is shared by Varde and us.
Future borrowings under the facility are subject to Varde's discretion and a
number of other conditions.

Our wholly-owned qualified special purpose entity, TCS Funding V, entered into a
$4.0 million credit facility to finance the purchase of $5.7 million in face
value credit card receivables from us for $4.9 million. We recorded the balance
of the sale price, $0.9 million, as a retained interest.

In the last quarter of fiscal 2001 and in the first quarter of fiscal 2002, we
completed sales of credit card receivables to third parties without recourse for
$2.7 million and $3.5 million.

We continue to explore alternate financing vehicles during fiscal 2002,
including replacing our Coast credit facility and entering into agreements to
sell performing accounts to financial institutions. We signed a non-binding
letter of intent to sell up to $20 million of performing credit card receivables
with six or more consecutive payments. We are in discussions with a second



                                       14
<PAGE>

institution to sell a minimum of $20 million of performing credit card
receivables having eight or more consecutive payments. Proceeds from these sales
would be adequate to meet our funding needs through the fiscal year. We cannot
guaranty that these sales will ultimately take place or if the timing of the
sales will allow us to meet our working capital needs as they arise. However,
management believes that cash on hand together with the proceeds of these or
other transactions it expects to consummate will be sufficient to fund our
operations during fiscal 2002.

DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

This amended Form 10-Q for the period ended September 30, 2001 contains
forward-looking statements within the meaning of the safe harbor provisions of
Section 21E of the Securities Exchange Act of 1934. These forward-looking
statements are based on the beliefs of our management as well as on assumptions
made by and information currently available to us at the time the statements
were made. When used in this Form 10-Q, the words "anticipate", "believe",
"estimate", "expect", "intend" and similar expressions, as they relate to us,
are intended to identify the forward-looking statements. Although we believe
that these statements are reasonable, you should be aware that actual results
could differ materially from those projected by the forward-looking statements.
Because actual results may differ, readers are cautioned not to place undue
reliance on forward-looking statements. Factors that may cause our actual
results to differ from those projected include, among others, the following: Our
credit card portfolio may not perform as well as we expect and may not generate
sufficient cash flows to fund our operations. We may not be able to finance our
operations if we are unable to sell our credit card receivables, if we are
unable to secure future financing, including credit line increases, or if we are
unable to control our expenses. The market for the sale or securitization of our
credit card receivables is limited and could be further limited if there is an
increase in competition or regulatory burdens on the industry or if the economy
declines. Our operations could be adversely affected if our suppliers and
vendors on which we rely to issue and service our credit card products fail to
perform or discontinue their agreements with us. If competition increases or if
the economy fluctuates, we may not be able to acquire enough credit card
receivables on favorable terms to operate profitably. In addition, we could
experience a shortfall in revenue if our customers do not pay on their
outstanding card balances. We may also be subject to adverse legal
determinations in lawsuits pending against us or filed in the future. Additional
factors that could cause actual results to differ include: risks associated with
future growth; fluctuations in operating results; the need for additional
capital; risks associated with consumer acceptance of our products; inability to
compete with competitors; potential labor shortages; and our failure to comply
with consumer and debtor protection laws and regulations. Certain of these risk
factors are more fully discussed in our Annual Report on Form 10-K for the year
ended June 30, 2001. We caution you, however, that the list of factors above may
not be exhaustive and that those or other factors, many of which are outside of
our control, could have a material adverse effect on us and our results of
operations. All forward-looking statements attributable to persons acting on our
behalf or us are expressly qualified in their entirety by the cautionary
statements set forth here. We assume no obligation to publicly release the
results of any revision or updates to these forward-looking statements to
reflect future events or unanticipated occurrences.




                                       15
<PAGE>



                             THE CREDIT STORE, INC.

                                   SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                                                   THE CREDIT STORE, INC.




DATE:     March 5, 2002                            By: /s/ Michael J. Philippe
                                                       -----------------------
                                                   Chief Financial Officer


                                       16