<PAGE>   1
                     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, 1999

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

                  For the transition period from _____ to _____

                           Commission File No. 0-28910

                           GENERAL CREDIT CORPORATION
        (Exact name of small business issuer as specified in its charter)

                NEW YORK                                    13-3895072
     ------------------------------                    -------------------
    (State or other jurisdiction of                       (IRS Employer
     incorporation or organization)                    Identification No.)

                        370 Lexington Avenue, Suite 2000
                            New York, New York 10017
                    ----------------------------------------
                    (Address of principal executive offices)

                                 (212) 697-4441
                                 --------------
                           (Issuer's Telephone Number)

        ----------------------------------------------------------------
              (Former name, former address and former fiscal year,
                          if changed since last report)

         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 [ ]

         On August 13, 1999, the number of shares of Common Stock of the issuer
outstanding was 3,615,000 shares of Common Stock, par value $.001 per share.

         Traditional Small Business Disclosure Format (check one) Yes [X] No [ ]

         Documents Incorporated By Reference: None


<PAGE>   2



                           GENERAL CREDIT CORPORATION
                                   FORM 10-QSB
                           QUARTER ENDED JUNE 30, 1999



                                TABLE OF CONTENTS
<TABLE>
<CAPTION>

<S>                                                                                                         <C>
PART I. FINANCIAL INFORMATION (UNAUDITED)

    Item 1. Financial Statements.............................................................................1

                  Consolidated Condensed Balance Sheets,
                        June 30, 1999 and December 31, 1998................................................F-1

                  Consolidated Condensed Statements of Operations for the
                        Three and Six Months Ended June 30, 1999 and 1998..................................F-2

                  Consolidated Condensed Statements of Cash Flows for the
                        Six Months Ended June 30, 1999 and 1998............................................F-3

                  Notes to Consolidated Condensed Financial Statements.....................................F-4

    Item 2. Management's Discussion and Analysis or Plan of Operation........................................2

PART II.  OTHER INFORMATION

     Item 1. Legal Proceedings...............................................................................7

     Item 2. Changes in Securities and Use of Proceeds.......................................................8

     Item 3. Defaults Upon Senior Securities.................................................................8

     Item 4. Submission of Matters to a Vote of Security Holders.............................................8

     Item 5. Other Information...............................................................................8

     Item 6. Exhibits and Reports on Form 8-K................................................................8

SIGNATURES...................................................................................................9
</TABLE>


<PAGE>   3



                          PART I. FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

         The unaudited, condensed financial statements included herein, have
been prepared in accordance with the requirements of Regulation S-B and
supplementary financial information included herein, if any, has been prepared
in accordance with Item 310(b) of Regulation S-B and, therefore, omit or
condense certain footnotes and other information normally included in financial
statements prepared in accordance with generally accepted accounting principles.
In the opinion of management, all adjustments (consisting only of normal
recurring accruals) necessary for a fair presentation of the financial
information for the interim periods reported have been made. Results of
operations for the three and six months ended June 30, 1999 are not necessarily
indicative of the results for the year ending December 31, 1999.

              [THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]



























                                        1


<PAGE>   4



                   GENERAL CREDIT CORPORATION AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                          JUNE 30,               DECEMBER 31,
                                                                           1999                     1998
                                                                       -------------             -----------
         ASSETS                                                         (UNAUDITED)
<S>                                                                    <C>                       <C>

Current assets:
  Cash and cash equivalents                                            $ 2,079,350               $ 1,335,548
  Certificates of deposit                                                   62,819                   212,819
  Restricted cash and uncleared checks                                   1,533,335                 2,333,335
  Receivables from customers
   and agents, net                                                       1,797,393                 1,625,315
  Prepaid expenses and other current
   assets                                                                  109,260                    95,142
                                                                       -----------               -----------

         Total current assets                                            5,582,157                 5,602,159

Fixed assets, at cost, less
  accumulated depreciation                                                 416,339                   310,646
Notes receivable from officer                                               56,696                    58,900
Goodwill and other intangibles, net                                        672,453                   393,916
Other assets                                                               113,898                   128,088
                                                                       -----------               -----------

         Total                                                         $ 6,841,543               $ 6,493,709
                                                                       ===========               ===========

         LIABILITIES
Current liabilities:
 Notes payable                                                         $ 2,906,214               $ 3,114,615
 Accounts payable and accrued
  expenses                                                                 918,207                   527,442
                                                                       -----------               -----------

         Total current liabilities                                       3,824,421                 3,642,057
                                                                       -----------               -----------

Long-term portion of notes payable                                         907,830                   768,074
                                                                       -----------               -----------
Minority interest                                                           45,054                        --
                                                                       -----------               -----------

         SHAREHOLDERS' EQUITY
Shareholders' equity:
  Common shares, $.001 par value,
   20,000,000 shares authorized,
   3,615,000 shares issued and
   outstanding                                                               3,615                     3,615
  Additional paid-in capital                                             7,953,938                 7,953,938
  Stock subscription                                                       (92,204)                  (99,778)
  Deficit                                                               (5,801,111)               (5,774,197)
                                                                       -----------               -----------

                                                                         2,064,238                 2,083,578
                                                                       -----------               -----------

         Total                                                         $ 6,841,543               $ 6,493,709
                                                                       ===========               ===========
</TABLE>


                 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF
                            THE FINANCIAL STATEMENTS.


                                      F-1



<PAGE>   5



                   GENERAL CREDIT CORPORATION AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)


<TABLE>
<CAPTION>

                                            SIX MONTHS ENDED                THREE MONTHS ENDED
                                                 JUNE 30,                          JUNE 30,
                                      -----------------------------       ----------------------------
                                          1999              1998              1999             1998
                                      -----------       -----------       -----------      -----------
<S>                                   <C>               <C>               <C>              <C>
Fee income - net                      $ 2,432,769       $ 1,921,421       $ 1,328,177      $   957,118
                                      -----------       -----------       -----------      -----------
Expenses:
   Selling general and
   administrative                       1,811,425         1,509,356           895,174          743,079

   Depreciation and amortization           86,343           194,795            47,266           98,958

   Interest expense - net                 516,861           444,974           297,575          224,375

   Minority interest                       45,054                --            45,054               --
                                      -----------       -----------       -----------      -----------
                                        2,459,683         2,149,125         1,285,069        1,066,412
                                      -----------       -----------       -----------      -----------
Net income (loss)                     $   (26,914)      $  (227,704)      $    43,108      $  (109,294)
                                      ===========       ===========       ===========      ===========
Net income (loss) per common
 share                                $      (.01)      $      (.07)      $       .01      $      (.03)
                                      ===========       ===========       ===========      ===========
Weighted average number of
 common shares outstanding              3,615,000         3,457,929         3,615,000        3,474,000
                                      ===========       ===========       ===========      ===========

</TABLE>
















                 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF
                            THE FINANCIAL STATEMENTS.

                                       F-2



<PAGE>   6



                   GENERAL CREDIT CORPORATION AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)



                                                        SIX MONTHS ENDED
                                                             JUNE 30,
                                                  -----------------------------
                                                      1999              1998
                                                  -----------       -----------
Cash flows from operating activities:
 Net loss                                         $   (26,914)      $  (227,704)
 Adjustments to reconcile
  net loss to net cash used
  in operating activities:
  Minority interest                                    45,054                --
  Depreciation and amortization                        86,343           194,795
  Issuance of stock options                                --            24,900
  Bad debt expense                                    100,000                --
 Change in assets and liabilities
  Receivables from customers and agents              (272,078)         (448,945)
  Prepaid expenses                                    (26,618)          (67,131)
  Other assets                                          8,609             9,228
  Accounts payable and accrued expenses               390,765           (39,530)
                                                  -----------       -----------

         Net cash provided by (used in)
          operating activities                        305,161          (554,387)
                                                  -----------       -----------

Cash flows from investing activities:
 Purchase of fixed assets                            (131,992)         (106,292)
 Decrease in certificate of deposit                   150,000                --
                                                  -----------       -----------

         Net cash provided by (used in)
          investing activities                         18,008          (106,292)
                                                  -----------       -----------

Cash flows from financing activities:
 Borrowings under long-term and
  short term debt agreements                        1,332,233            70,000
 Repayments of long-term and
  short-term debt                                  (1,520,878)         (324,238)
 Payment for purchase of business                    (200,500)               --
 Proceeds from exercise of warrants                        --            82,125
 Cash restricted for debt payments                    800,000           300,000
 Collection on loans to officer                         2,204                --
 Collection on stock subscription                       7,574                --
 Loans to officer and shareholder                          --           (10,000)
                                                  -----------       -----------

         Net cash provided by financing
          activities                                  420,633           117,887
                                                  -----------       -----------
Net increase (decrease) in cash and cash
 equivalents                                          743,802          (542,792)

Cash and cash equivalents, beginning of
 period                                             1,335,548         1,794,338
                                                   -----------      -----------

Cash and cash equivalents, end of
 period                                           $ 2,079,350       $ 1,251,546
                                                  ===========       ===========

SUPPLEMENTARY INFORMATION:
 Interest paid                                    $   531,567       $   507,235
                                                  ===========       ===========




                 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF
                            THE FINANCIAL STATEMENTS.

                                       F-3



<PAGE>   7

<PAGE>   8



                   GENERAL CREDIT CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



NOTE 1 - BASIS OF PRESENTATION

   The unaudited, condensed consolidated financial statements included herein,
commencing at page F-1, have been prepared in accordance with the requirements
of Regulation S-B and supplementary financial information included herein, if
any, has been prepared in accordance with Item 310(b) of Regulation S-B and,
therefore, omit or condense certain footnotes and other information normally
included in financial statements prepared in accordance with generally accepted
accounting principles. In the opinion of management, all adjustments (consisting
only of normal recurring accruals) necessary for a fair presentation of the
financial information for the interim periods reported have been made. The
financial statements should be read in conjunction with the financial statements
and notes thereto, together with Management's Discussion and Analysis of
Financial Condition or Plan of Operation, contained in the Company's
Registration Statement on Form SB-2 (SEC File No. 333-09831) declared effective
by the Securities and Exchange Commission on April 25, 1997 and the Company's
1998 Annual Report on Form 10-KSB. Results of operations for the six and three
months ended June 30, 1999 are not necessarily indicative of the results for a
full year.

   The Company's independent auditors' report on the Company's consolidated
financial statements for the fiscal year ended December 31, 1998, included an
explanatory paragraph stating that the Company has not complied with certain
financial covenants of the Long Term Loan which have not been waived by the
Affiliated Corporation (as such terms are defined below). While management
believes that if the Long Term Loan is called by the Affiliated Corporation,
there exists sufficient collateral to repay the Long Term Loan, such an event
would severely limit the Company's ability to conduct normal operations, which
raises substantial doubt about the Company's ability to continue as a going
concern. Notwithstanding the non-compliance with certain technical covenants of
the Long Term Loan, in April 1999, the Affiliated Corporation and the Company
entered into a third amendment to the Long Term Loan, which, among other things,
extended the termination date of the Long Term Loan. Subsequent to April 1999,
in consideration for the payment by the Company to the Affiliated Corporation of
$500,000 and the Company's agreement to fully satisfy the Company's repayment
obligations under the Long Term Loan by delivering to the Affiliated Corporation
six successive monthly installments of $300,000 plus applicable interest, the
Affiliated Corporation has agreed to forebear from (but not waive) exercising
its rights (including its right to require repayment of the Long Term Loan)
under the Long Term Loan. In the event the Company does not comply with its
obligation to pay down the Long Term Loan, the Affiliated Corporation may avail
itself of all of its remedies under the Long Term Loan including requiring the
Company to satisfy in full the Long Term Loan. No further credit is available to
the Company under the Long Term Loan. Although the Company has entered into an



                                       F-4


<PAGE>   9



informal arrangement with a non-affiliated third party (the "Short Term Lender")
to provide short term financing to the Company at 24% per annum (which loaned
amounts totaled approximately $940,000 as of June 30, 1999), there can be no
assurances that this financing will continue or that additional financing will
be available on terms favorable to the Company, if at all. No assurances can be
given that the Company will be able to obtain alternate long term sources of
funding or that the Affiliated Corporation will not call the Long Term Loan
resulting in the Company being required to pay all of the outstanding amounts
owed under the Long Term Loan.

NOTE 2 ACQUISITIONS

   NEW YORK PAYROLL FACTORS ("NYPF")

   In 1996, the Company entered into a definitive agreement to acquire NYPF and
made non-refundable payments of $200,000. Since the acquisition did not close by
November 15, 1996, the closing date stipulated in the original agreement, the
deposit of $200,000 was expensed to operations during fiscal 1996. On January
13, 1997, the Company and NYPF entered into a new agreement to acquire NYPF for
$4,500,000 in cash and 125,000 shares of common stock. The acquisition of NYPF
was closed in May 1997 upon the conclusion of the public offering. The value
assigned to the shares issued was $3.083 a share, which equals their value in
the public offering. This acquisition was treated as a purchase for accounting
purposes and the operations of NYPF have been included in the consolidated
statement of operations from May 2, 1997. The Company recorded goodwill of
$4,497,691 and a covenant not-to-compete of $350,000 relating to the NYPF
acquisition. During the year ended December 31, 1998, the Company wrote off the
remaining unamortized portion of the goodwill and the covenant not to complete.

   ACE VENTURE, INC. ("ACE")

   On September 30, 1997 the Company acquired the operations of Ace (an
exclusive sales agent of the Company) for $489,500 (which includes legal costs
of $9,500). The purchase price was paid for by the Company by its issuance of
notes totaling $380,000 and cash of $109,500. The notes bear interest at 10% a
year and are payable in equal monthly installments of $7,040 for principal and
interest over 72 months to October 2003. This acquisition was treated as a
purchase for accounting purposes and the operations of Ace have been included in
the consolidated statement of operations from October 1, 1997. The Company
recorded goodwill of $232,000 and a covenant not-to-compete of $232,000 relating
to the Ace acquisition.

   CASH PAYROLL EXPRESS LLC ("CPE")

   On April 27, 1999 the Company acquired 50% of the operations of CPE for
$320,500 (which includes legal and other costs of $10,500). The purchase price
was paid by the Company by its issuance of notes totaling $120,000 and cash of
$200,500. The notes bear interest at 7% a year and are payable in equal monthly
installments of $2,377 over 60 months. In addition, the Company may be obligated
to pay an additional $215,000 based upon the earnings of CPE. This acquisition
was treated as a purchase for accounting purposes and the operations of CPE have
been included in the consolidated statement of operations from April 27, 1999.
The Company recorded goodwill of $295,500 and a covenant not-to-compete of
$15,000 relating to the CPE acquisition.



                                       F-5


<PAGE>   10

<PAGE>   11



ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

   THE FOLLOWING DISCUSSION OF THE FINANCIAL CONDITION OR PLAN OF OPERATION OF
THE COMPANY SHOULD BE READ IN CONJUNCTION WITH THE COMPANY'S CONSOLIDATED
FINANCIAL STATEMENTS AND NOTES THERETO INCLUDED ELSEWHERE IN THIS REPORT.

   THE COMPANY'S INDEPENDENT AUDITORS' REPORT ON THE COMPANY'S CONSOLIDATED
FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED DECEMBER 31, 1998, INCLUDED AN
EXPLANATORY PARAGRAPH STATING THAT THE COMPANY HAS NOT COMPLIED WITH CERTAIN
FINANCIAL COVENANTS OF THE LONG TERM LOAN WHICH HAVE NOT BEEN WAIVED BY THE
AFFILIATED CORPORATION (AS SUCH TERMS ARE DEFINED BELOW). WHILE MANAGEMENT
BELIEVES THAT IF THE LONG TERM LOAN IS CALLED BY THE AFFILIATED CORPORATION,
THERE EXISTS SUFFICIENT COLLATERAL TO REPAY THE LONG TERM LOAN, SUCH AN EVENT
WOULD SEVERELY LIMIT THE COMPANY'S ABILITY TO CONDUCT NORMAL OPERATIONS, WHICH
RAISES SUBSTANTIAL DOUBT ABOUT THE COMPANY'S ABILITY TO CONTINUE AS A GOING
CONCERN. NOTWITHSTANDING THE NON-COMPLIANCE WITH CERTAIN TECHNICAL COVENANTS OF
THE LONG TERM LOAN, IN APRIL 1999, THE AFFILIATED CORPORATION AND THE COMPANY
ENTERED INTO A THIRD AMENDMENT TO THE LONG TERM LOAN, WHICH, AMONG OTHER THINGS,
EXTENDED THE TERMINATION DATE OF THE LONG TERM LOAN. SUBSEQUENT TO APRIL 1999,
IN CONSIDERATION FOR THE PAYMENT BY THE COMPANY TO THE AFFILIATED CORPORATION OF
$500,000 AND THE COMPANY'S AGREEMENT TO FULLY SATISFY THE COMPANY'S REPAYMENT
OBLIGATIONS UNDER THE LONG TERM LOAN BY DELIVERING TO THE AFFILIATED CORPORATION
SIX SUCCESSIVE MONTHLY INSTALLMENTS OF $300,000 PLUS APPLICABLE INTEREST, THE
AFFILIATED CORPORATION HAS AGREED TO FOREBEAR FROM (BUT NOT WAIVE) EXERCISING
ITS RIGHTS (INCLUDING ITS RIGHT TO REQUIRE REPAYMENT OF THE LONG TERM LOAN)
UNDER THE LONG TERM LOAN. IN THE EVENT THE COMPANY DOES NOT COMPLY WITH ITS
OBLIGATION TO PAY DOWN THE LONG TERM LOAN, THE AFFILIATED CORPORATION MAY AVAIL
ITSELF OF ALL OF ITS REMEDIES UNDER THE LONG TERM LOAN INCLUDING REQUIRING THE
COMPANY TO SATISFY IN FULL THE LONG TERM LOAN. NO FURTHER CREDIT IS AVAILABLE TO
THE COMPANY UNDER THE LONG TERM LOAN. ALTHOUGH THE COMPANY HAS ENTERED INTO AN
INFORMAL ARRANGEMENT WITH A NON-AFFILIATED THIRD PARTY (THE "SHORT TERM LENDER")
TO PROVIDE SHORT TERM FINANCING TO THE COMPANY AT 24% PER ANNUM (WHICH LOANED
AMOUNTS TOTALED APPROXIMATELY $940,000 AS OF JUNE 30, 1999), THERE CAN BE NO
ASSURANCES THAT THIS FINANCING WILL CONTINUE OR THAT ADDITIONAL FINANCING WILL
BE AVAILABLE ON TERMS FAVORABLE TO THE COMPANY, IF AT ALL. NO ASSURANCES CAN BE
GIVEN THAT THE COMPANY WILL BE ABLE TO OBTAIN ALTERNATE LONG TERM SOURCES OF
FUNDING OR THAT THE AFFILIATED CORPORATION WILL NOT CALL THE LONG TERM LOAN
RESULTING IN THE COMPANY BEING REQUIRED TO PAY ALL OF THE OUTSTANDING AMOUNTS
OWED UNDER THE LONG TERM LOAN.

OVERVIEW

   General Credit Corporation (the "Company") was organized in February 1995.
From its inception through May 2, 1997, the Company's operations were limited to
administrative activities. On May 2, 1997, the Company acquired substantially
all of the assets of New York Payroll Factors, Inc. ("NYPF") concurrently with
the closing of the Company's initial public offering of securities (the "IPO")
and commenced operations. For approximately seven years prior to the IPO, NYPF
had been engaged in providing working capital financing to its customers through
the discounted purchase of checks (commonly referred to as "Check Factoring").
Since May 3, 1997 the Company has provided

                                        2


<PAGE>   12



check factoring services to its customers, generally on a non-recourse basis
with respect to its customers except to the extent of forged signatures on and
stop payments of the purchased checks. In September 1997 the Company commenced
purchasing credit card sales slips on a discounted non-recourse basis. To date,
the purchase of credit card sales slips ("Credit Card Sales Slips") has not been
a material part of the Company's business.

RESULTS OF OPERATIONS

   For the three and six months ended June 30, 1999, the Company derived fee
income of $1,328,177 and $2,432,769, respectively, from the purchase of checks
and credit card sales slips, compared to $957,118 and $1,921,421 for the three
and six months ended June 30, 1998. The Company's Bush Terminal Brooklyn, New
York location which the Company acquired on April 27, 1999 generated fee income
of approximately $130,000 for the period ended June 30, 1999. The face amount of
checks purchased during the three and six months ended June 30, 1999 was
approximately $118,000,000 and $220,000,000, respectively, compared to
$88,000,000 and $177,000,000 for the three and six months ended June 30, 1998,
and the face amount of credit card sales slips purchased during the three and
six months ended June 30, 1999 was approximately $796,000 and $1,301,000,
respectively, compared to $936,000 and $1,607,000 for the three and six months
ended June 30, 1998.

   Selling, general and administrative expenses, including, among other
expenses, amounts paid in respect of sales representatives, payroll and related
expenses and office overhead costs (including rent) during the three and six
months ended June 30, 1999 was $895,174 and $1,811,425, compared to $743,079 and
$1,509,356 for the three and six months ended June 30, 1998, respectively. The
increase in the selling , general and administrative expenses is due to the
expenses associated with new locations, including, among other things, increased
payroll and rental expenses. In addition, included in the selling, general and
administrative expenses for the three and six months ended June 30, 1999 is an
increase in the allowance for bad debts in the amount of $50,000 and $100,000,
respectively.

   For the three and six months ended June 30, 1999 interest expense, net of
interest income, was $297,575 and $516,861 which reflects the high interest rate
the Company is paying for its borrowings, compared to $224,375 and $444,974 for
the three and six months ended June 30, 1998.

   For the three and six months ended June 30, 1999, the Company incurred
non-cash expenses of $106,266 and $204,343, as compared to $123,858 and $219,695
for the three and six months ended June 30, 1998, respectively, consisting
primarily of the amortization of the intangible assets resulting from the
purchase of the business of a commissioned agent in September 1997 and another
company in April 1999, and an increase in the allowance for bad debts in the
amount of $50,000 and $100,000 for the three and six month periods ended June
30, 1999 respectively. The Company recorded a one-time non-recurring charge in
the fourth quarter of 1998 of approximately $4.65 million, or ($1.32) per share
relating to the elimination of the remaining balance of the goodwill and the
covenant not to compete from the NYPF business combination. Accordingly, the
Company during the six months ended June 30, 1999 did not incur any expense or
amortization cost relating to the NYPF business combination, which amount

                                       3


<PAGE>   13



was $73,721 and $147,422 for the three and six month periods ended June 30,
1998.

   Net profit for the three months ended June 30, 1999 was $43,108 ($.01 per
share) and the net loss for the six months ended June 30, 1999 was $26,914 ($.01
per share). Net loss for the three and six months ended June 30, 1998 was
$109,294 ($.03 per share) and $227,704 ($.07 per share), respectively.

   Earnings before taxes, depreciation, and the increase in allowance for bad
debts and amortization ("EBTDA") during the three and six months ended June 30,
1999 was $149,374 and $177,429, respectively. EBTDA for the three and six months
ended June 30, 1998 was a loss of $10,336 and $8,009, respectively. EBTDA is not
presented as an alternative to operating results or cash flow from operations as
determined by generally accepted accounting principles ("GAAP"), but rather to
provide additional information related to the ability of the Company to meet
current trade obligations and debt service requirements. EBTDA should not be
considered in isolation from, or construed as having greater importance than,
GAAP operating income or cash flows from operations as a measure of an entity's
performance.

LIQUIDITY AND CAPITAL RESOURCES

   The Company's capital requirements generally increase proportionately to the
aggregate face amount of checks purchased, although more rapid collection of
purchased checks can mitigate the Company's cash needs.

   The Company finances its operations principally through (i) cash flow
generated from operations; (ii) a long term working capital credit facility in
the aggregate original principal amount of up to $2,333,335 (the "Long Term
Loan") provided by a corporation (the "Affiliated Corporation"), in part owned
by Gerald Schultz, the former owner of NYPF and Ann Nimberg, the wife of Gerald
Nimberg, the President, Chief Operating Officer and Chief Financial Officer of
the Company (such funding has ceased as of June 1999 due to the Company's
agreement to satisfy in full its obligations over a six month period); (iii) a
$500,000 working capital loan (the "500,000 Loan") provided by the wife of a
sales representative of the Company; (iv) demand loans from Irwin Zellermaier,
the Company's Chief Executive Officer and Ann Nimberg, the wife of Gerald
Nimberg, the Company's President, Chief Operating Officer and acting Chief
Financial Officer in the principal amount of $295,335; and (v)
short term working capital loan arrangements with various banks and lenders,
unaffiliated with the Company, who extend credit to the Company based upon
uncollected checks purchased by the Company and deposited for payment. This
credit has, from time to time, reached approximately $5.5 million and is
typically repaid with interest or uncollected bank charges daily or every few
days (the "Uncollected Check Loans"). Ann Nimberg has informed the Company that
she owns approximately 8% of the Affiliated Corporation.

   Pursuant to the terms of the Long Term Loan, as amended (last amended in
April 1999), the Affiliated Corporation established a credit facility in favor
of the Company in the aggregate principal amount of $2,333,335. As of August 13,
1999, no further credit is available to the Company under the Long Term Loan.
The Company's repayment obligations under the Long Term Loan are secured by,
among other things, all of the Company's accounts receivable and certain
fixtures and equipment at the Company's leased premises. The Long Term Loan
requires that the Company maintain collateral in the form of uncollected
purchased checks or cash in the minimum amount of $2,333,335 (the "Collateral

                                        4


<PAGE>   14



Requirement"). Pursuant to the Long Term Loan, the full amount of the Long Term
Loan is due and payable, in the event, among other things: (i) the Company's
losses (before non-cash charges) are greater than $50,000 per year or in any two
consecutive quarters in a fiscal year; (ii) the Company's cash balances are less
than $1.1 million (which amounts are exclusive of the Collateral Requirement);
or (iii) the Company does not deliver to the Affiliated Corporation its audited
financial statements before the date which is 90 days from December 31. An event
of default exists under the Long Term Loan due to the Company's losses (before
non-cash items) being greater than $50,000 during 1998 and the Company
delivering audited financial statements to the Affiliated Corporation on April
15, 1999, which date is after the deadline of March 31, 1999.

   In order to induce the Affiliated Corporation to refrain from exercising its
default rights under the Long Term Loan and without waiving its rights, the
Company delivered to the Affiliated Corporation a principal payment of $500,000,
thereby reducing the amounts owed under the Long Term Loan to $1,833,335 and in
June 1999 the Company entered into a Forbearance Agreement with the Affiliated
Corporation pursuant to which, the Company agreed to a repayment program
requiring that the Company fully satisfy its remaining repayment obligations
under the Long Term Loan over a six month period, at a rate of $300,000 plus
interest monthly until the sixth month when all remaining amounts are payable by
the Company. As of August 13, 1999, the principal amount outstanding under the
Long Term Loan was $1,233,335.

   Pursuant to the $500,000 Loan, the Company is obligated to pay, on a monthly
basis, interest only at 21% per annum on the outstanding principal amount under
the $500,000 Loan. All accrued but unpaid interest together with the principal
amount outstanding under the $500,000 Loan is due to be repaid by the Company in
November 2001. The Company may prepay the $500,000 Loan without premium or
penalty.

   As of June 30, 1999, Irwin Zellermaier, the Company's Chief Executive Officer
and Chairman of the Board of Directors and Ann Nimberg, the wife of Gerald
Nimberg, the Company's President, Chief Operating Officer and acting Chief
Financial Officer provided unsecured short term working capital loans to the
Company in the principal amount of $240,000 and approximately $55,000
(collectively the "Zellermaier and Nimberg Loans"),  of which $30,000 and
$40,000 was provided by Mr. Zellermaier and Ms. Nimberg, respectively during the
three months ended June 30, 1999. The principal amount of the Zellermaier and
Nimberg Loans are repayable by the Company to Mr. Zellermaier and Ms. Nimberg on
Mr. Zellermaier's and Ms. Nimberg's respective demand subject to the Company's
obligation to notify the Affiliated Corporation of such demand for payment and
the Affiliated Corporation's right to be repaid all outstanding amounts under
the Long Term Loan. Interest at 21% per annum is payable monthly by the Company
on the Zellermaier and Nimberg Loans.

   As of June 30, 1999, in addition to the above mentioned liabilities, the
Company is obligated under several demand notes and advances payable in the
aggregate amount of approximately $1,485,000, with interest at 24% per annum.

   In order for the Company to grow and purchase checks, it requires capital. To
date, the Company has not had adequate cash resources to satisfy the demand it
perceives for its check purchasing services. The Company is currently seeking
additional debt or equity financing to replace the financing

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<PAGE>   15



previously provided by the Long Term Loan which is currently being paid down by
the Company at the rate of $300,000 per month and to fund expansion of the
Company's business. Although the Company has entered into an informal
arrangement with a non-affiliated third party (the "Short Term Lender") to
provide short term financing to the Company at 24% per annum (which loaned
amounts totaled approximately $940,000 as of June 30, 1999), there can be no
assurances that this financing will continue or that additional financing will
be available on terms favorable to the Company, if at all. If adequate funds are
not available or are not available on acceptable terms, the Company may not be
able to maintain or improve operating results, fund growth, take advantage of
certain acquisition opportunities or respond to competitive pressures.

   As of June 30, 1999, the Company had available cash and cash equivalents and
certificates of deposit of approximately $2,142,000 as compared to approximately
$1,548,000 as of December 31, 1998. This increase in cash is due principally to
the Short Term Lender not requiring the Company to maintain collateral in the
form of restricted cash.

EFFECTS OF INFLATION

   The Company believes that the results of its operations could be materially
impacted by inflation, including increases in interest rates generally, if
inflation materially adversely affected the operations of the Company's
customers and their customers, and if inflation materially increased the
Company's costs of obtaining working capital (e.g., if the Company entered into
larger lines of credit in lieu of its maintaining some of the current bank
deposits against which it negotiates checks purchased by it).

YEAR 2000 COMPLIANCE

         The Year 2000 ("Year 2000") computer issue is the result of computer
programs using a two-digit format, as opposed to a four-digit format to indicate
the year. Such computer programs will be unable to recognize date information
correctly when the year changes to 2000. The Year 2000 issue poses risks for the
Company's information technology systems.

         The Company's information technology systems are based upon software
licenses and software maintenance agreements with third party software
companies. Based upon the Company's internal assessments and communications with
its software vendors, all of the software utilized by the Company is Year 2000
compliant software. The Company has used internal personnel to test its software
systems for Year 2000 compliance and such tests yielded positive results. The
Company will continue to monitor its Year 2000 readiness. Also, the Company does
not anticipate difficulty in resolving issues related to imbedded technology in
the equipment provided to the Company by other manufacturers.

         Based on the foregoing, the Company believes that it will be Year 2000
compliant on a timely basis and that future costs relating to the Year 2000
issue will not have a material impact on the Company's consolidated financial
position, results of operations or cash flows.

                                        6


<PAGE>   16



FORWARD LOOKING INFORMATION MAY PROVE INACCURATE

         This Quarterly Report on Form 10-QSB contains certain forward-looking
statements and information relating to the Company that are based on the beliefs
of management, as well as assumptions made by and information currently
available to the Company. When used in this document, the word "anticipate,"
"believe," "estimate," "expect" and "intends" and similar expressions, as they
relate to the Company, are intended to identify forward-looking statements. Such
statements reflect the current views of the Company with respect to future
events and are subject to certain risks, uncertainties and assumptions,
including the uncertainty associated with the Company's acquisition of
additional financing, those described in this Quarterly Report on Form 10-QSB,
the Company's Registration Statement on Form SB-2 (SEC File No. 333-09831)
declared effective by the Securities and Exchange Commission on April 25, 1997
and periodic reports filed by the Company. Should one or more of these risks or
uncertainties materialize, or should underlying assumptions prove incorrect,
actual results may vary materially from those described herein as anticipated,
believed, estimated or expected. The Company does not intend to update these
forward-looking statements.


                           PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

         The Company is currently a defendant in a lawsuit brought by an
unaffiliated third party individual who seeks to have a parcel of improved real
property located in Brooklyn, New York previously owned by the Company
transferred back to the unaffiliated third party individual on the basis of
fraud committed by the Company (the "Real Property Suit"). The improved real
property was initially transferred to the Company in consideration for amounts
owed to the Company. The unaffiliated third party individual's claim also seeks
damages for "over reaching" against the Company in the amount of $1,000,000. The
Company is vigorously defending the lawsuit and based on advice of its counsel,
believes the action is without merit or legal basis.

         In March 1998, the Company received a demand letter from an
unaffiliated third party individual regarding certain allegations advanced by
this unaffiliated third party individual against the Company (the "Letter").
According to the Letter, the unaffiliated third party individual alleges he is
entitled to have the Company transfer to him 750,000 shares of the Company's
Common Stock due to certain breaches of agreements by the Company. The Company
has received no further correspondence from this unaffiliated third party
individual. If pursued, the Company intends to vigorously defend against these
allegations.

         The Company is engaged from time to time as plaintiff in litigation
relating to collection of returned checks. Such litigation has not historically
had any material effect on its financial condition or results of operations.

                                       7


<PAGE>   17



ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS

         In July 1999, the Company granted to each of Irwin Zellermaier and
Gerald Nimberg the option to acquire for a period of two years from July 8,
1999, 100,000 shares of the Company's Common Stock at an exercise price of $.25
per share.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

         An event of default exists under the Long Term Loan due to the
Company's losses (before non-cash items) being greater than $50,000 during 1998
and the Company not delivering audited financial statements to the Affiliated
Corporation prior to March 31, 1999. The Affiliated Corporation entered into an
amendment to the Long Term Loan in April 1999, and in June 1999 entered into a
forbearance agreement with the Company pursuant to which the Affiliated
Corporation agreed to forbear from exercising its rights under the Long Term
Loan (including its right to acceleration), without waiving its rights
thereunder, in consideration for the Company agreeing to a six-month re-payment
plan. In addition to the Short Term Lender, management is seeking additional
sources of funding to replace the Long Term Loan. No assurances can be given
that the Company will be able to obtain alternate sources of funding, on a
timely basis, if at all, or that the Affiliated Corporation will not call the
Long Term Loan upon default by the Company, resulting in the Company being
required to pay all of the outstanding amounts owed under the Long Term Loan.

ITEM 4. SUBMISSION OF MATTERS TO VOTE OF SECURITY HOLDERS

         During the second quarter ended June 30, 1999, no matters were
submitted to a vote of security holders of the Company, through the solicitation
of proxies or otherwise.

ITEM 5. OTHER INFORMATION

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

         (a)      Exhibits

                  Number            Description
                  ------            -----------

                  27.1              Financial Data Schedule (for SEC use only)

         (b)      Reports on Form 8-K

                  None.











                                       8


<PAGE>   18



                                   SIGNATURES

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


                                GENERAL CREDIT CORPORATION

Date: August 13, 1999           By:  /s/ Irwin Zellermaier
                                     ------------------------------
                                     Irwin Zellermaier,
                                     Chief Executive Officer


Date: August 13, 1999           By:  /s/ Gerald Nimberg
                                     ---------------------------------
                                     Gerald Nimberg,
                                     Principal Financial and Accounting Officer



























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