------------------------------------------------------------------------------

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

                                  FORM 10-QSB

              [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                  For the quarterly period ended June 30, 1998

                                       OR

             [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                 For the period from _________ to ____________

                        Commission File Number 000-22681

                             FINANTRA CAPITAL, INC.
-------------------------------------------------------------------------------
       (Exact name of small business issuer as specified in its charter)


          Delaware                                13-3571419
-------------------------------------------------------------------------------
(State or other jurisdiction of                 I.R.S. Employer
incorporation or organization)                  Identification Number

           1100 Ponce de Leon Boulevard, Coral Gables, Florida 33134
-------------------------------------------------------------------------------
                   (Address of Principal Executive Offices)

                                 (305) 443-5002
-------------------------------------------------------------------------------
                          (Issuer's Telephone Number)

            Check whether the issuer (1) filed all reports required to be filed
by Section 13 or 15(d) of the Exchange Act during the past 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 equity, as of the latest practicable date:


                                                   Number of Shares Outstanding
              Class                                    on August 12, 1998
              -----                                ----------------------------
     Common Stock, par value $.01 per share            4,133,027 shares

     Transitional Small Business Disclosure Format        Yes      No  X
                                                              ---     ---


<PAGE>



                             FINANTRA CAPITAL, INC.

                                     INDEX

PART I  FINANCIAL INFORMATION                                            PAGE

  Item 1  Condensed Consolidated Financial Statements (Unaudited)         3

          Condensed Consolidated Balance Sheet at June 30, 1998           3

          Condensed Consolidated Statements of Income for the
          Three and Six Months ended June 30, 1998 and 1997               5

          Condensed Consolidated Statements of Cash Flows for the
          Six Months ended June 30, 1998 and 1997                         6

          Notes to Condensed Consolidated Financial Statements            7

  Item 2  Management's Discussion and Analysis of Financial
          Condition and Results of Operations                            13


PART II  OTHER INFORMATION                                               16

  Item 6  Exhibits                                                       16

SIGNATURES                                                               17


                                      -2-
<PAGE>
                             FINANTRA CAPITAL, INC.
                                AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEET
                                 JUNE 30, 1998
                                  (UNAUDITED)

                                     ASSETS
                                     ------

<TABLE>
<CAPTION>

<S>                                                                              <C>
Current assets:
   Cash and cash equivalents                                                     $2,458,035
   Accounts receivable, net of allowance for doubtful
      accounts of $3,000                                                            599,312
   Finance receivable                                                             2,859,056
   Note receivable - shareholder                                                     10,820
   Prepaid expenses                                                                 393,354
                                                                                 ----------

Total current assets                                                              6,320,577

Property and equipment, at cost, net of accumulated depreciation                    137,113

Other assets:
   Goodwill, net                                                                  2,196,707
   Note receivable - stockholders                                                   245,680
   Due from affiliates                                                               32,307
   Other                                                                            103,666
                                                                                 ----------

Total other assets                                                                2,578,360

Total assets                                                                     $9,036,050
                                                                                 ==========
</TABLE>



See accompanying notes to condensed consolidated financial statements.




                                      -3-
<PAGE>


                            FINANTRA CAPITAL, INC.
                               AND SUBSIDIARIES
                     CONDENSED CONSOLIDATED BALANCE SHEET
                                 JUNE 30, 1998
                                  (UNAUDITED)



                     LIABILITIES AND STOCKHOLDERS' EQUITY
                     ------------------------------------

<TABLE>
<CAPTION>


<S>                                                                          <C>        
Current liabilities:
   Notes payable                                                             $ 1,190,475
   Current portion of long-term debt                                              61,220
   Current portion of obligations to finance companies                            50,754
   Accounts payable and accrued expenses                                         366,310
                                                                              ----------

Total current liabilities                                                      1,668,759

Other liabilities:
   Long-term debt, net of current portion                                         60,000
   Obligations to finance companies, net of current portion                       26,913

Total other liabilities                                                           86,913

Total liabilities                                                              1,755,672

Commitments and contingencies

Stockholders' equity:
Preferred stock, $.01 par value, 5,000,000 authorized,
   2,958,817 shares issued and outstanding                                        29,588
Common stock, $.01 par value, 10,000,000 authorized,
   3,126,661 shares issued and 292,500 to be issued                               31,267
Additional paid-in capital                                                    10,020,591
Treasury stock                                                                   (37,250)
Accumulated deficit                                                           (2,763,818)
                                                                              ----------

Total stockholders' equity                                                     7,280,378

Total liabilities and stockholders' equity                                   $ 9,036,050
                                                                             ===========


</TABLE>

See accompanying notes to condensed consolidated financial statements.




                                      -4-
<PAGE>


                             FINANTRA CAPITAL, INC.
                                AND SUBSIDIARIES
                  CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                                  (UNAUDITED)

<TABLE>
<CAPTION>


                                                                                FOR THE THREE MONTHS ENDED  FOR THE SIX MONTHS ENDED
                                                                                          JUNE 30,                   JUNE 30,
                                                                                --------------------------  ------------------------
                                                                                  1998             1997        1998          1997
                                                                                 ------           -----        -----         -----
<S>                                                                             <C>            <C>           <C>          <C>      
Revenues                                                                        $1,354,961     $   91,123    $2,632,078   $ 230,286

Costs and expenses:
   Depreciation                                                                     47,327         17,000        93,583      34,000
   Interest expense                                                                 30,835         18,345        30,835      27,988
   General and administrative expenses                                           1,138,830         48,912     2,335,633     114,763
                                                                                ----------     ----------    ----------   ---------

Total costs and expenses                                                         1,216,992         84,257     2,460,051     176,751
                                                                                ----------     ----------    ----------   ---------

Income (loss) from operations                                                      137,969          6,866       172,027      53,535
                                                                                ----------     ----------    ----------   ---------

Other expenses:
   Loss on sale of securities                                                            -        (33,924)            -     (40,580)
                                                                                ----------     ----------    ----------   ---------

Total other expenses                                                                     -        (33,924)            -     (40,580)
                                                                                ----------     ----------    -----------  ---------

Net income (loss)                                                               $  137,969     $  (27,058)   $  172,027   $  12,955
                                                                                ==========     ==========    ===========  =========

Net income (loss) applicable to common shareholders                             $   69,769     $ (100,965)   $   35,627   $(134,922)
                                                                                ==========     ==========    ===========  =========

Net income (loss) per common share                                                $    .02        $  (.06)     $    .01    $   (.08)
                                                                                  ========        =======      =========   ========

Weighted average number of shares outstanding
   and to be issued                                                              3,359,959      1,680,000     3,342,310  1,680,000
                                                                                ==========      =========     =========  =========
</TABLE>

     See accompanying notes to condensed consolidated financial statements.



                                      -5-
<PAGE>


                    FINANTRA CAPITAL, INC. AND SUBSIDIARIES
                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  (UNAUDITED)

<TABLE>
<CAPTION>

                                                                                               FOR THE SIX MONTHS ENDED
                                                                                                      JUNE 30,
                                                                                             --------------------------
                                                                                              1998                1997
                                                                                             ------              -----
<S>                                                                                         <C>                <C>       
Cash flows from operating activities:
   Net cash used by operating activities                                                    $  (396,067)       $ (34,748)
                                                                                            -----------        ---------

Cash flows from investing activities:
   Cash acquired in acquisitions                                                                 78,584                -
   Net advances (to) from affiliates                                                             43,106           (9,786)
   Note receivable - stockholders                                                               (60,000)               -
   Purchase of equipment                                                                        (34,181)               -
   Purchase of securities available for sale                                                          -          (75,010)
   Proceeds from sale of securities available for sale                                                -           34,401
   Proceeds from sale of equipment                                                                    -           21,000
   Notes acquired for cash                                                                   (2,555,556)               -
                                                                                             ----------          -------
Net cash used by investing activities                                                        (2,528,047)         (29,395)
                                                                                             ----------          -------

Cash flows from financing activities:
   Borrowings on line-of-credit                                                               1,049,950                -
   Repayment of notes payable                                                                         -          (60,000)
   Proceeds from long-term debt                                                                       -          160,000
   Repayments of long-term debt                                                                 (46,275)         (59,670)
   Net proceeds from shareholder loans                                                                -           28,500
   Payments of preferred dividends                                                             (136,400)               -
   Repayment of shareholder loans                                                                     -           (6,253)
   Issuance of common stock                                                                     445,321                -
   Purchase of treasury stock                                                                   (37,250)               -
                                                                                             ----------          -------
Net cash provided by financing activities                                                     1,275,346           62 577
                                                                                             ----------           ------

Net (decrease) in cash                                                                       (1,648,768)          (1,566)

Cash - beginning                                                                              4,106,803                -
                                                                                               ---------     -----------
Cash - end                                                                                   $2,458,035      $    (1,566)
                                                                                             ==========      ===========

Supplemental disclosure of cash flow information:
      Cash paid during the period:
       Interest                                                                              $        -      $    22,866
                                                                                             ==========      ===========
Supplemental noncash investing and financial activities:
   Issuance of common stock for acquisition of
      subsidiaries                                                                           $2,631,862      $         -
                                                                                             ==========      ===========
   Leased equipment received from affiliated
     company as payment on intercompany receivable                                           $        -      $    87,758
                                                                                             ==========      ===========
   Obligations to finance companies transferred to
      affiliated company                                                                     $        -      $    27,807
                                                                                             ==========      ===========

</TABLE>

    See accompanying notes to condensed consolidated financial statements.


                                      -6-
<PAGE>




                    FINANTRA CAPITAL, INC. AND SUBSIDIARIES
             NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                 JUNE 30, 1998

NOTE 1 - CORPORATION NAME CHANGE

Effective August 5, 1998, the Company changed its corporate name from Medley
Credit Acceptance Corp. to Finantra Capital, Inc.

NOTE 2 - PRINCIPLES OF CONSOLIDATION

The accompanying financial statements include the accounts of the Company and
its wholly-owned subsidiaries, Premier Provider Services, Inc., Medical Billing
Service Systems, Inc. and Ameri-Cap Leasing Corp., and its 80% owned
subsidiaries, American Investment Management, Inc. ("AIM") and American Factors
Group, Inc.

NOTE 3 - BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with generally accepted accounting principles for
interim financial information and Article 10 of Regulation S-X. Accordingly,
they do not include all of the information and footnotes required for complete
financial statements. In the opinion of management, all adjustments necessary
for a fair presentation of the results for the interim periods presented have
been included.

These results have been determined on the basis of generally accepted
accounting principles and practices applied consistently with those used in the
preparation of the Company's Annual Financial Statement for the year ended
December 31, 1997. Operating results for the six months ended June 30, 1998,
are not necessarily indicative of the results that may be expected for the year
ending December 31, 1998.

It is recommended that the accompanying condensed consolidated financial
statements be read in conjunction with the financial statements and notes
thereto included elsewhere in this filing.

Certain items in the condensed consolidated financial statements for the
interim period ended June 30, 1997, have been reclassified to conform with the
current presentation. These reclassifications had no effect on net income.

NOTE 4 - ACQUISITIONS

On June 30, 1998, the Company, through a wholly owned subsidiary, Ameri-Cap
Leasing Corp., acquired 80% of the outstanding common stock of MFC Financial
Corp. As consideration, the Company issued 10,000 shares of its common stock.
Additionally, the Company has agreed to acquire the remaining MFC Financial
Corp. shares annually in equal installments over a three-year period from the
date of the closing, with the first installment commencing one year from the
date of closing and on the same day each year thereafter.


                                      -7-
<PAGE>



                    FINANTRA CAPITAL, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                 JUNE 30, 1998

NOTE 4 - ACQUISITIONS (CONTINUED)

The acquisition consideration for the balance of the MFC shares shall be an
amount of Company common stock equal to two and one half times the net pre-tax
income of the Company's leasing division in the first year, three times the net
pre-tax income of the Company's leasing division in the second year, and four
times the net pre-tax income of the Company's leasing division in the third
year. The number of shares to be issued shall be based upon the closing share
price of the Company's common stock on the date of each exchange. The
acquisition was accounted for using the purchase method of accounting and
$30,000 in goodwill was recorded which is being amortized over fifteen (15)
years. The results of operations of MFC Financial Corp. are included in the
condensed consolidated statements of income since the date of acquisition.

All acquisitions by the Company during the six months ended June 30, 1998 were
accounted for as purchases and $2,272,455 in goodwill was recorded which is
being amortized over 15 years using the straight line method. Amortization
expense amounted to $37,874. The results of operations are included in the
condensed consolidation statements of income since the date of the
acquisitions. The purchase prices assigned to the net assets acquired were
based on the fair value of such assets and liabilities at the respective
acquisition dates.

On January 1, 1998, the Company completed its acquisitions of Premier Provider
Services, Inc. and Medical Billing Service Systems, Inc. The Company agreed to
issue to the principals of these subsidiaries an aggregate of 585,000 shares of
common stock, each share valued at $4.50, one-half of which were issued upon
the closing of the acquisitions, with the remaining one-half of such shares
being issuable on the first anniversary of such acquisitions. The 292,500
unissued shares have been treated as outstanding at March 31, 1998, and have
been included in earnings per share. In addition, the Company agreed to issue
to the principals of these subsidiaries incentive stock options pursuant to the
Company's option plan to acquire common stock through December 31, 2001, under
certain circumstances, up to an aggregate of 150,000 additional shares of
common stock based upon the subsidiaries' financial performance.

The Company acquired an 80% interest in AIM during the quarter ended March 31,
1998. In consideration the Company agreed to issue to the principal of AIM
shares of the Company's common stock on the first, second and third
anniversaries of acquisition. These shares represent less than 1% of the
outstanding shares of the Company.




                                      -8-
<PAGE>


                    FINANTRA CAPITAL, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                 JUNE 30, 1998

NOTE 4 - ACQUISITIONS (CONTINUED)

The proforma unaudited results of operations for the six months ended June 30,
1997, assuming consummation of the purchase at the beginning of the period, are
as follows:

                                                    FOR THE SIX MONTHS ENDED
                                                            JUNE 30,
                                                   -------------------------
                                                      1998           1997
                                                      ----           -----
Revenues                                           $2,632,078    $ 1,355,423
Net income                                         $  172,027    $   319,859
Net income per common share after dividends        $      .01    $       .07
                                                   ==========    ===========

The unaudited proforma information does not purport to be indicative of the
results of operations which would have resulted had the acquisitions been
consummated at the date assumed.

NOTE 5 - NOTES PAYABLE

Notes payable consists of the following at June 30, 1998:

$4,000,000 line-of-credit with a financial institution; interest is payable
monthly at prime plus 1 1/2%. The line is secured by certain finance
receivables.
                                                                     $1,115,475

Note payable
------------
Note payable due bank collateralized by certain of the Company's
assets not otherwise pledged and is personally guaranteed by the
Company's principal officer and an affiliate                             75,000
                                                                     ----------

Total                                                                $1,190,475
                                                                     ==========


                                      -9-
<PAGE>




                    FINANTRA CAPITAL, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                 JUNE 30, 1998

NOTE 6 - OBLIGATIONS TO FINANCE COMPANIES

Obligations to finance companies, secured by rental equipment and related
rental agreements, consist of:

<TABLE>
<CAPTION>

<S>                                                                                     <C>    
18.7% obligation payable in monthly installments of
   $2,260, including interest, through April 1998.                                      $10,791

23.6% obligation payable in varying monthly installments,
   including interest, through November 1999.                                            19,156


21.2% obligation payable in varying monthly installments,
   including interest, through November 1999.                                            36,722

18.3% obligation payable in varying monthly installments,
    including interest, through November 1999.                                           10,998
                                                                                        -------
                                                                                         77,667
Less: current maturities                                                                (50,754)
                                                                                        -------
     Long-term obligations                                                              $26,913
                                                                                        =======
</TABLE>

NOTE 7 - DIVIDENDS PAYABLE - PREFERRED STOCK

The Company has paid $68,200 of dividends on its preferred stock at June 30,
1998.

NOTE 8 - LONG-TERM DEBT

At June 30, 1998, the Company is obligated to various individuals for amounts
aggregating $121,220. These notes are for various amounts and maturities
through January 1999. Interest is payable at rates ranging from 10% to 13.5%
per annum. The unsecured portion of these notes is $88,724.

NOTE 9 - RELATED PARTY TRANSACTIONS

The Company loaned its principal officer $60,000 as of June 30, 1998. The note
bears interest at 10% per annum with interest only payable quarterly. The
entire unpaid principal balance and accrued interest is due May 5, 2001.

In addition, the Company loaned $200,000 to a company owned by a shareholder of
the Company. The installment note carries a 12% interest rate per annum. The
note will be repaid in monthly installments of $3,500, commencing June 1, 1998
the entire unpaid principal balance, together with accrued interest is due on
May 31, 2001.


                                     -10-
<PAGE>


                    FINANTRA CAPITAL, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                 JUNE 30, 1998

NOTE 10 - EMPLOYEE STOCK OPTIONS

Options to purchase 85,000 shares of the Company's common stock at an average
price per share of approximately $1.22 have been granted to certain of the
Company's officers and key employees.

The Company has elected to account for the stock options under Accounting
Principles Board Option No. 25, "Accounting for Stock Issued to Employees" and
related interpretations. Accordingly, no compensation expense has been
recognized on the stock options.

Had compensation expense for the stock option plan been determined based on the
fair value of the options at the grant date consistent with the methodology
prescribed under Statement of Financial Standards No. 124, "Accounting for
Stock Based Compensation", the Company's net income would have been decreased
by approximately $4,100. The fair value of each option is estimated on the date
of grant using the fair market option pricing model with the assumption:

Risk-free interest rate                                    5.5%
Expected life (years)                                    2 to 3
Expected volatility                                        .426
Expected dividends                                         None

A summary of option transactions during the six months ended June 30, 1998 is
shown below:

                                                                       WEIGHTED
                                                                       AVERAGE
                                                     NUMBER            EXERCISE
                                                    OF SHARES          PRICE

Outstanding at December 31, 1997                          -            $    -
Granted                                              85,000              1.22
Exercised                                                 -                 -
Forfeited                                                 -                 -
                                                    -------                   

Outstanding at June 30, 1998                         85,000
                                                    =======

Exercisable at June 30, 1998                              -
                                                    =======

Available for issuance at June 30, 1998              85,000
                                                    =======



                                     -11-
<PAGE>

                    FINANTRA CAPITAL, INC. AND SUBSIDIARIES
             NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                 JUNE 30, 1998


NOTE 11 - INDUSTRY SEGMENT INFORMATION

The Company currently operates primarily two industry segments: specialty
finance and medical billing and financial administrative services. Revenues,
income from operation, identifiable assets, capital expenditures and
depreciation and amortization pertaining to the industries in which the Company
operates are presented below:


                                                  FOR THE SIX MONTHS ENDED
                                                         JUNE 30
                                                -----------------------------
                                                     1998            1997
                                                     ----            ----
Industry segments:
Revenues:
   Specialty finance                            $  513,656     $   230,286
   Medical billing and financial services        2,118,422               -
                                                ----------     -----------
Total                                           $2,632,078     $   230,286
                                                ==========     ===========

Income (loss) from operations:
   Specialty finance                            $ (244,373)    $    53,535
   Medical billing and financial services          416,400               -
                                                ----------     -----------
Total                                           $  172,027     $    53,535
                                                ==========     ===========

Identifiable assets:
   Specialty finance                            $5,898,098     $ 1,816,823
   Medical billing and financial services        3,137,952               -
                                                 ---------     -----------
            Total                               $9,036,050     $ 1,816,823
                                                ==========     ===========

Capital expenditures:
   Specialty finance                            $   21,175     $         -
   Medical billing and financial services           13,016               -
                                                ----------     -----------
            Total                               $   34,191     $         -
                                                ==========     ===========

Depreciation and amortization:
   Specialty finance                            $    1,350     $    34,000
   Medical billing and financial services           92,233               -
                                                ----------     -----------
Total                                           $   93,583     $    34,000
                                                ==========     ===========



                                     -12-
<PAGE>




               MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                      CONDITION AND RESULTS OF OPERATIONS

RECENT DEVELOPMENTS

            Effective August 5, 1998, Medley Credit Acceptance Corp., a
Delaware corporation (the "Company"), changed its name to "Finantra Capital,
Inc." In addition, on July 15, 1998, Mr. Evaldo (Fred) Dupuy was appointed as
the fourth director of the Company. Mr Dupuy, age 53, is the owner of several
finance companies and, for the last five years, has been a principal with the
investment banking firm of Coast Partners Securities, Inc., a boutique firm
specializing in securing asset and debt related facilities for its clients. Mr.
Dupuy is a member of the Florida Premium Finance Association, Florida
Automobile Dealers Association, Florida Mortgage Brokers Association and the
Asset Based Lender Association.

GENERAL

            The Company is a specialty finance company engaged, principally, in
accounts receivable financing (factoring), equipment leasing and traditional
financing business lines. Since the consummation, in late December 1997, of the
Company's initial public offering of approximately $6.8 million of securities
(the "IPO"), the Company's operations have focused primarily on growing an
operation base and establishing a market presence in each of the aforementioned
businesses. The Company's primary strategy for achieving its necessary growth
and market presence has been, among other things, to pursue acquisitions of
existing enterprises which, in the Company's opinion, have immediate earnings
potential and long-term growth possibilities.

            While the Company has only a limited operating history in the
accounts receivable financing and traditional financing business lines, the
Company has more seasoned experience in the equipment leasing business. Prior
to the consummation of the Company's IPO, the Company's business and affairs
focused on the financing of (i) dry cleaning equipment to small dry cleaning
business throughout the eastern United States and (ii) refrigeration equipment
sold or leased by an affiliate. The Company has made a business decision to
orderly wind down, commencing during the fiscal year ended December 31, 1997,
its dry cleaning and refrigeration equipment financing operations.

            In an effort to grow its accounts receivable financing and
traditional financing business lines, while establishing a market presence for
the same, the Company, during the quarter ended March 31, 1998 ("First Quarter
1998"), consummated several significant transactions. Principal among these
were (i) the Company's formation of its American Factors Group, Inc. subsidiary
("AFG"), an entity specializing in accounts receivable financing, (ii) the
Company's acquisition of a majority interest in Americal Investment Management
("AIM"), a marketer and manager of a variety of financial and insurance related
services, and (iii) the Company's acquisition of Medical Billing Service
Systems, Inc. ("Medical Billing) and Premier Provider Services, Inc.
("Premier"; Medical Billing and Premier are sometimes hereinafter collectively
referred to as the "Medical Billing Subsidiaries"), companies engaged,
generally, in providing back office auditing and other financial administrative
services principally to the medical industry.

            In anticipation of expanding its equipment leasing business, the
Company, during the quarter ended June 30, 1998 ("Second Quarter 1998"),
acquired, through its newly-formed wholly-owned subsidiary, Ameri-Cap Leasing
Corp. ("Ameri-Cap"), 80% of the outstanding capital stock of MFC Financial
Corp., a Florida corporation ("MFC"). MFC is engaged in the financing business
generally, including equipment leasing. In consideration for this acquisition,
the Company issued to Messrs. Ron Epstein, Elliot Kalus and Henry Koche, the
stockholders of MFC, an aggregate of 10,000 shares of the Company's Common
Stock. The Company, through Ameri-Cap, has agreed, on each of the first three
anniversaries of the initial closing 


                                     -13-
<PAGE>


of this acquisition, to acquire from Messrs. Epstein, Kalus and Koche the
remaining 20% of the capital stock of MFC. The consideration payable for such
remaining 20% interest shall be, on the first anniversary, an aggregate number
of shares of the Company's Common Stock equal to two and one-half times the net
pre-tax income of Ameri-Cap for its first year of operations, on the second
anniversary, an aggregate number of shares of the Company's Common Stock equal
to three times the net pre-tax income of Ameri-Cap for its second year of
operations and on the third anniversary, an aggregate number of shares of the
Company's Common Stock equal to four times the net pre-tax income of Ameri-Cap
for its third year of operations. Shares of the Company's Common Stock will be
valued at the closing sale price on the date of their issuance.

            In connection with the MFC acquisition, the Company entered into
three year employment agreements with each of Messrs. Epstein, Kalus and Koche.
These agreements, among other things, entitle Messrs. Epstein, Kalus and Koche
to be granted incentive stock options pursuant to the Company's 1997 Stock
Option Plan based upon Ameri-Cap's annual financial performance and to
participate in a discretionary cash bonus pool for Ameri-Cap's employees if
Ameri-Cap's financial performance justifies the same. These employment
agreements are terminable by the Company for cause, however, if, among other
things, after the six month period immediately following the Company's initial
purchase of its controlling interest in MFC, Ameri-Cap's net monthly sales
volume (defined as the total amount of all leases written in any calendar
month) is less than $500,000 per month in any consecutive three month period or
in a three month aggregate in any 12 month period.

            During Second Quarter 1998, the Company also provided a financial
accommodation to an affiliate for a fee equal to $150,000 per annum, which fee
is payable each year the Company continues to extend such financial
accommodation. Specifically, the Company posted a $1.475 million standby letter
of credit on behalf of the affiliate. This letter of credit was posted for the
purpose of securing the performance of certain equipment leases sold by the
affiliate to an unrelated party. The Company's financial exposure under this
letter of credit has been collateralized by the pledge by the affiliate to the
Company of 750,000 shares of the Company's Common Stock owned by the affiliate,
which Common Stock, for purposes of the pledge, has an agreed upon value of
$2.50 per share.

RESULTS OF OPERATIONS

Three Months Ended June 30, 1998 Compared to Three Months Ended June 30, 1997

            For Second Quarter 1998, the Company generated revenues of
$1,354,961, an increase of $1,263,838 from revenues of $91,123 for the three
months ended June 30, 1997 ("Second Quarter 1997"). This increase in revenues
was primarily the result of the Company's acquisitions of AIM, the Medical
Billing Subsidiaries and MFC, and the subsequent commencement of the Company's
accounts receivable financing (factoring) and traditional financing business
lines and expanded equipment leasing operations.

            During Second Quarter 1998, the Company incurred an increase of
$1,089,918 in general and administrative expenses over Second Quarter 1997
figures, principally as a result of the Company's commencement of its accounts
receivables financing (factoring) and traditional financing business lines and
expanded equipment leasing operations. Principally as a consequence thereof,
the Company recorded net income from operations of $137,969 for Second Quarter
1998 as compared to net income from operations of $6,866 for Second Quarter
1997. When combined with the provision for dividends with respect to shares of
the Company's Series A 10% Convertible Preferred Stock, the Company generated
net income applicable to common shareholders for Second Quarter 1998 of
$69,769, or approximately $.02 per share, as compared to incurring net losses
applicable to common shareholders for Second Quarter 1997 of $100,965, or
approximately $.06 per share.


                                     -14-
<PAGE>


Six Months Ended June 30, 1998 Compared to Six Months Ended June 30, 1997

            For the six months ended June 30, 1998 ("Six Months 1998"), the
Company generated revenues of $2,632,078, an increase of $2, 401,792 from
revenues of $230,286 for the six months ended June 30, 1997 ("Six Months
1997"). This increase in revenues was primarily the result of the Company's
acquisitions of AIM, the Medical Billing Subsidiaries and MFC, and the
subsequent commencement of the Company's accounts receivable financing
(factoring) and traditional financing business lines and expanded equipment
leasing operations.

            For Six Months 1998, the Company incurred an increase of $2,220,870
in general and administrative expenses over Six Months 1997 figures,
principally as a result of the Company's commencement of its accounts
receivables financing (factoring) and traditional financing business lines and
expanded equipment leasing operations. Principally as a consequence thereof,
the Company recorded net income from operations of $172,027 for Six Months 1998
as compared to net income from operations of $12,955 for Six Months 1997. When
combined with the provision for dividends with respect to shares of the
Company's Series A 10% Convertible Preferred Stock, the Company generated net
income applicable to common shareholders for Six Months 1998 of $35,627, or
approximately $.01 per share, as compared to incurring net losses applicable to
common shareholders for Six Months 1997 of $134,922, or approximately $.08 per
share.

LIQUIDITY AND CAPITAL RESOURCES

            At June 30, 1998, the Company had total assets of $9,036,050, as
compared to total assets of $4,944,831 at December 31, 1997. This significant
increase in total assets is primarily the result of the Company's acquisition
of AIM and the Medical Billing Subsidiaries during First Quarter 1998 and MFC
during Second Quarter 1998 and the commencement of operations of AFG's accounts
receivable financing (factoring) business. At June 30, 1998, a finance
receivable arising predominantly from AFG's operations in the amount of
$2,859,056 was recorded on the Company's balance sheet. The $2,196,707 of
goodwill, net, recorded on the Company's balance sheet at June 30, 1998
represents the premium over net equity paid by the Company in connection with
its acquisitions of AIM, the Medical Billing Subsidiaries and MFC. The Company
anticipates that its future earnings (assuming its acquired subsidiaries
continue to generate earnings) will offset the amortization associated with the
recording of this goodwill.

            At June 30, 1998, the Company had total liabilities of $1,755,672,
as compared to total liabilities of $751,211 at December 31, 1997. This
increase in total liabilities was primarily due to the incurrence of borrowings
under the accounts receivable credit facility established for AFG,
notwithstanding the Company's continued timely satisfaction of other
obligations.

            At June 30, 1998, the Company had total stockholders' equity of
$7,280,378, as compared to total stockholders' equity of $4,204,620 at December
31, 1997. The significant increase in stockholders' equity is attributable
directly to the earnings generated by the Company from operations, values
associated with the Company's formation of AFG and acquisition, utilizing
primarily shares of the Company's Common Stock, of AIM, the Medical Billing
Subsidiaries and MFC.

            The Company's experience in the specialty finance business has
historically been conducted with a smaller capital base than currently is
available to the Company. As a consequence of the consummation of the IPO, the
Company believes that it is positioned to secure additional lines of credit and
traditional bank financings for the purpose of expanding and developing its
business lines. There can be no assurance, however, that the Company will
successfully implement all or a portion of this anticipated expansion.


                                     -15-
<PAGE>


            The Company anticipates, based on its current proposed plans and
assumptions relating to its operations and expansion, that it will be able to
satisfy its currently contemplated cash requirements for approximately the next
12 months from working capital and cash flow. In the event that the Company's
plans change or its assumptions prove to be inaccurate, or working capital and
cash flow prove to be insufficient to fund the Company's operations and
expansion (due to unanticipated expenses, delays, problems or otherwise), the
Company would be required to seek additional funding. Depending upon the
Company's financial strength and the state of the capital markets, the Company
may also determine that it is advisable to raise additional equity capital. The
Company has no current arrangements with respect to, or sources of, any
additional capital, and there can be no assurance that such additional capital
will be available to the Company, if needed, on commercial reasonable terms or
at all. The inability of the Company to obtain additional capital would have a
material adverse effect on the Company and could cause the Company to be unable
to implement its business strategy or proposed expansion or to otherwise
significantly curtail or cease operations.



                                    PART II
                               OTHER INFORMATION

ITEM 6. EXHIBITS

    No.                     Description
    ---                     -----------
    3.1  Certificate of Amendment of Amended and Restated Certificate of 
         Incorporation, as filed with the Delaware Secretary of State on 
         August 5, 1998.

   10.1  Stock Purchase Agreement, dated June 30, 1998, among Ameri-Cap, Ron 
         Epstein, Elliot Kalus, Henry Koche and the Company.

   10.2  Employment Agreement, dated June 30, 1998, between Ameri-Cap and Ron 
         Epstein.

   10.3  Employment Agreement, dated June 30, 1998, between Ameri-Cap and Elliot
         Kalus.

   10.2  Employment Agreement, dated June 30, 1998, between Ameri-Cap and Henry
         Koche.

     27  Financial Data Schedule




                                     -16-
<PAGE>



                                   SIGNATURES

In accordance with the requirements of the Exchange Act, the Registrant caused
this Report to be signed on its behalf of the undersigned, thereunto duly
authorized.



                                FINANTRA CAPITAL, INC.




Dated: August 13, 1998          By: /s/ Robert D. Press
                                    -------------------
                                    Robert D. Press, Chairman of the Board,
                                    President, Chief Executive Officer and
                                    Chief Financial Officer
                                    (Principal Executive and Financial Officer)







                                     -17-
<PAGE>


                                 EXHIBIT INDEX
                                 -------------


No.                              Description
---                              -----------
 3.1  Certificate of Amendment of Amended and Restated Certificate of 
      Incorporation, as filed with the Delaware Secretary of State on 
      August 5, 1998.

10.1  Stock Purchase Agreement, dated June 30, 1998, among Ameri-Cap, Ron 
      Epstein, Elliot Kalus, Henry Koche and the Company.

10.2  Employment Agreement, dated June 30, 1998, between Ameri-Cap and Ron 
      Epstein.

10.3  Employment Agreement, dated June 30, 1998, between Ameri-Cap and Elliot
      Kalus.

10.2  Employment Agreement, dated June 30, 1998, between Ameri-Cap and Henry 
      Koche.

  27  Financial Data Schedule.




                                     -18-