SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549
                                    --------

                                    FORM 10-Q

(Mark One)

 x  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF SECURITIES EXCHANGE ACT
--- OF 1934

                                             September 30, 1996
    For the quarterly period ended______________________________________________
 
--- TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF SECURITIES EXCHANGE
    ACT OF 1934

    For the transition period from _____________________  to ___________________
 
                                               0-26015
                   Commission file number ____________________

                               CRW FINANCIAL, INC.
________________________________________________________________________________
             (Exact name of registrant as specified in its charter)

           Delaware                                       23-2691986
________________________________________________________________________________
(State or other jurisdiction of             (I.R.S. employer identification no.)
 incorporation or organization)

443 South Gulph Road             King of Prussia, PA               19406
________________________________________________________________________________
(Address of principal                                            (Zip Code)
  executive offices)

                                                           610/962-5100
Registrant's telephone number, including area code: ____________________________

________________________________________________________________________________
              Former name, former address and former fiscal year,
                         if changed since last report.

        Indicate by check whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes __x__ No ____

                      APPLICABLE ONLY TO CORPORATE ISSUERS:

        The number of shares of the Company's common stock, $0.01 par value,
outstanding as of November 10, 1996 was 3,918,063 shares.

<PAGE>

                      CRW FINANCIAL, INC. AND SUBSIDIARIES

                                      INDEX



                                                                            PAGE
PART I -  FINANCIAL INFORMATION

ITEM 1 -  FINANCIAL STATEMENTS

             CONDENSED CONSOLIDATED BALANCE SHEETS
             AT DECEMBER 31, 1995 AND SEPTEMBER 30, 1996                       3
       
             CONDENSED CONSOLIDATED STATEMENTS OF
             OPERATIONS FOR THE PERIODS ENDED
             SEPTEMBER 30, 1995 AND 1996                                       4
       
             CONDENSED CONSOLIDATED STATEMENTS OF
             CASH FLOWS FOR THE PERIODS ENDED
             SEPTEMBER 30, 1995 AND 1996                                       5
       
             NOTES TO CONDENSED CONSOLIDATED
             FINANCIAL STATEMENTS                                              6
     
ITEM 2 -  MANAGEMENT'S DISCUSSION AND ANALYSIS
          OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION                     9

PART II - OTHER INFORMATION_________

ITEM 6 -  EXHIBITS AND REPORTS ON FORM 8-K                                    14


<PAGE>

<TABLE>

                      CRW FINANCIAL, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS


<CAPTION>

                                          DECEMBER 31, 1995  SEPTEMBER 30, 1996
                                          -----------------  ------------------
                                                                (Unaudited)

<S>                                         <C>                <C>
                  ASSETS

CURRENT ASSETS:


     CASH                                   $  2,074,000       $  1,461,000

     CASH HELD FOR CLIENTS                     3,333,000          2,774,000
     ACCOUNTS RECEIVABLE, NET                  3,094,000          3,506,000
     OTHER CURRENT ASSETS                        419,000            773,000
                                            ------------       ------------

           TOTAL CURRENT ASSETS                8,920,000          8,514,000

PROPERTY AND EQUIPMENT, NET                    3,320,000          3,150,000

INTANGIBLE ASSETS, NET                         5,338,000          4,993,000

INVESTMENT IN TWI (Notes 1, 4 and 6)                --           53,268,000

OTHER ASSETS                                     967,000            666,000
                                            ------------       ------------
                                            $ 18,545,000       $ 70,591,000
                                            ============       ============

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:

     COLLECTIONS TO CLIENTS                 $  3,333,000       $  2,774,000
     ACCOUNTS PAYABLE                          2,774,000          2,390,000
     ACCRUED COMPENSATION                        811,000          1,050,000
     OTHER ACCRUED EXPENSES                    1,034,000            965,000
     CURRENT PORTION OF LONG-TERM DEBT         1,385,000          7,886,000
                                            ------------       ------------

     TOTAL CURRENT LIABILITIES                 9,337,000         15,065,000

LONG-TERM DEBT                                 5,723,000            427,000
                                            ------------       ------------
DEFERRED INCOME TAXES                               --           19,475,000
                                            ------------       ------------
OTHER LONG-TERM LIABILITIES                      299,000            414,000
                                            ------------       ------------

STOCKHOLDERS' EQUITY:

     PREFERRED STOCK                                --            2,382,000
     COMMON STOCK                                 39,000             39,000
     ADDITIONAL PAID IN CAPITAL                4,097,000         36,359,000
     ACCUMULATED DEFICIT                        (950,000)        (3,570,000)
                                            ------------       ------------
           TOTAL STOCKHOLDERS' EQUITY          3,186,000         35,210,000
                                            ------------       ------------
                                            $ 18,545,000       $ 70,591,000
                                            ============       ============


</TABLE>

            See notes to condensed consolidated financial statements.




                                       -3-


<PAGE>



                      CRW FINANCIAL, INC. AND SUBSIDIARIES

                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)


<TABLE>
<CAPTION>


                                                                 For the                                      For the
                                                          Thirteen weeks ended                         Thirty-nine weeks ended
                                                 September 30, 1995     September 30, 1996    September 30, 1995  September 30, 1996
                                                 ------------------     ------------------    ------------------  ------------------

<S>                                                  <C>                    <C>                  <C>                  <C>         
NET REVENUES                                         $  7,920,000           $  7,021,000         $ 24,256,000         $ 23,069,000
OPERATING EXPENSES, excluding                                                                                   
     Non-cash charges                                   7,787,000              8,018,000           22,590,000           23,144,000
SPECIAL COMPENSATION CHARGES (NOTE 8)                        --                  690,000                 --              1,319,000
DEPRECIATION                                              188,000                238,000              484,000              699,000
AMORTIZATION                                              151,000                123,000              646,000              370,000
                                                     ------------           ------------         ------------         ------------
                                                                                                                
     Operating income (loss)                             (206,000)            (2,048,000)             536,000           (2,463,000)
                                                                                                                
GAIN ON SALE OF TWI STOCK (NOTE 6)                           --                1,176,000                 --              1,176,000
                                                                                                                
INTEREST EXPENSE                                         (152,000)              (224,000)            (388,000)            (593,000)
                                                     ------------           ------------         ------------         ------------
     Income (loss) from continuing operations                                                                   
     before income taxes                                 (358,000)            (1,096,000)             148,000           (1,880,000)
INCOME TAXES (BENEFIT)                                   (133,000)              (380,000)              56,000             (639,000)
                                                     ------------           ------------         ------------         ------------
                                                                                                                
     Income (loss) from continuing operations            (225,000)              (716,000)              92,000           (1,241,000)
                                                                                                                
EARNINGS (LOSS) FROM EQUITY OF TWI, NET                      --                  177,000                 --               (100,000)
                                                     ------------           ------------         ------------         ------------
                                                                                                                
     Income (loss) before discontinued operations        (225,000)              (539,000)              92,000           (1,341,000)
                                                                                                                
GAIN FROM MERGER OF CCS AND HFS                              --                     --             29,017,000                 --
 INCOME (LOSS) FROM DISCONTINUED OPERATIONS,                                                                    
        NET OF TAX                                           --                 (308,000)             567,000             (533,000)
                                                     ------------           ------------         ------------         ------------
                                                                                                                
     Income (loss) before extraordinary item         $   (225,000)          $   (847,000)        $ 29,676,000         $ (1,874,000)
                                                                                                                
EXTRAORDINARY LOSS ON                                                                                           
        EXTINQUISHMENT OF DEBT, NET OF TAX                   --                 (746,000)                --               (746,000)
                                                     ------------           ------------         ------------         ------------
                                                                                                                
     Net income (loss)                               $   (225,000)          $ (1,593,000)        $ 29,676,000         $ (2,620,000)
                                                     ============           ============         ============         ============
                                                                                                                
NET INCOME (LOSS) PER COMMON SHARE (NOTE 3):                                                                    
                                                                                                                
     CONTINUING OPERATIONS                           $      (0.08)          $      (0.15)        $       0.02         $      (0.36)
                                                                                                                
     DISCONTINUED OPERATIONS                                 --                    (0.08)                6.95                (0.15)
                                                                                                                
     EXTRAORDINARY LOSS                                      --                    (0.20)                --                  (0.21)
                                                     ------------           ------------         ------------         ------------
                                                     $      (0.08)          $      (0.43)        $       6.97         $      (0.72)
                                                     ============           ============         ============         ============
                                                                                                         

WEIGHTED AVERAGE  SHARES OUTSTANDING                    2,794,293              3,700,413            4,255,809            3,628,063
                                                     ============           ============         ============         ============
 
</TABLE>

                                      -4-

<PAGE>




                      CRW FINANCIAL, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                              FOR THE THIRTY-NINE WEEKS    FOR THE THIRTY-NINE WEEKS
                                                                              ENDED SEPTEMBER 30. 1995      ENDED SEPTEMBER 30. 1996
                                                                              -------------------------     ------------------------

<S>                                                                                   <C>                           <C>             
CASH FLOWS FROM OPERATING ACTIVITIES:
NET INCOME (LOSS)                                                                     $ 29,676,000                  $ (2,620,000)   
                                                                                                                                    
     Adjustments to reconcile net income (loss) to net cash provided by                                                             
     operating activities:                                                                                                          
            Non-Cash Special Compensation Charge                                              --                         629,000    
            Non-Cash Extraordinary Loss                                                                                1,131,000
            Discontinued Operations - Non-Cash Charges and                                                  
                    Working Capital Changes                                                 77,000                         4,000    
            Loss on Equity of TWI                                                             --                         100,000    
            Gain on sale of CCI                                                        (29,017,000)                         --      
            Depreciation and amortization                                                1,130,000                     1,069,000    
            Deferred taxes (benefit)                                                        56,000                    (1,298,000)   
     (Increase) decrease in assets                                                                                                  
            Accounts receivable                                                           (167,000)                     (412,000)   
            Other assets                                                                    39,000                      (456,000)   
                                                                                                                                    
     Increase (decrease) in liabilities
            Accounts payable                                                               (97,000)                     (384,000)   
            Accrued expenses                                                            (1,520,000)                      130,000    
            Other liabilities                                                              (54,000)                       84,000    
                                                                                      ------------                  ------------    
                                                                                                                                    
Net cash provided by (used in) operating activities                                        123,000                    (2,023,000)   
                                                                                      ------------                  ------------    
                                                                                                                                    
                                                                                                                                    
CASH FLOWS FROM INVESTING ACTIVITIES:                                                                                               
                                                                                                                                    
     Investment in TWI                                                                        --                      (2,110,000)   
     Purchases of property and equipment                                                  (732,000)                     (490,000)   
     Cash paid for acquisitions                                                            (25,000)                         --      
                                                                                      ------------                  ------------    
                                                                                                                                    
Net cash used in investing activities                                                     (757,000)                   (2,600,000)   
                                                                                      ------------                  ------------    
                                                                                                                                    
CASH FLOWS FROM FINANCING ACTIVITIES:                                                                                               
                                                                                                                                    
     Proceeds from Exercise of Options to Purchase Common Stock                               --                         455,000    
     Proceeds from sale of Preferred Stock                                                    --                       2,382,000    
     Borrowings under line of credit                                                     5,867,000                     2,000,000    
     Repayments of long term debt                                                       (4,927,000)                     (795,000)   
     Payments of deferred financing costs                                                 (319,000)                      (32,000)   
                                                                                      ------------                  ------------    
                                                                                                                                    
Net cash provided by financing activities                                                  621,000                     4,010,000    
                                                                                      ------------                  ------------    
                                                                                                                                    
DECREASE IN CASH                                                                           (13,000)                     (613,000)   
                                                                                      ------------                  ------------    
                                                                                                                                    
CASH, BEGINNING OF PERIOD                                                                1,174,000                     2,074,000    
                                                                                      ------------                  ------------    
                                                                                                                                    
CASH, END OF PERIOD                                                                   $  1,161,000                  $  1,461,000    
                                                                                      ============                  ============    
                                                                                                                                    
</TABLE>
          

            See notes to condensed consolidated financial statements.
                                       -5-


<PAGE>





                      CRW FINANCIAL, INC. AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1.  BACKGROUND:

         CRW Financial, Inc. ("CRW" or "The Company") performs receivables
management, administration and debt collection services for clients primarily in
the health care, student loan, credit card and utility industries, and to
commercial clients through its wholly owned subsidiary Kaplan & Kaplan, Inc.
CRW's subsidiary Casino Money Centers, Inc. ("CMC"), provides financial support
services to the casino industry. CRW's subsidiaries were subsidiaries of Casino
& Credit Services, Inc. ("CCS") prior to May 11, 1995, and CRW's operations were
a division of CCS from July 1992 to May 11, 1995 when CCS contributed all of its
assets and subsidiaries other than Central Credit, Inc. ("CCI") to a newly
formed subsidiary, CRW Financial, Inc. CCS then spun-off CRW in a distribution
of CRW stock to CCS Shareholders on May 11, 1995. The historical financial
statements of CRW have been deemed to be those of CCS, restated to present CCI
as a discontinued operation.

         TeleSpectrum Worldwide Inc. ("TWI") provides teleservices solutions to
clients in the telecommunications, insurance, financial services,
pharmaceuticals, and healthcare, consumer products and high technology
industies. CRW formed TWI in April 1996 to acquire several teleservices
businesses in connection with an initial public offering of TWI's common stock.
The accounts of TWI were consolidated into CRW's financial statements prior to
the completion of the initial public offering on August 12, 1996 (see note 6).
Subsequent to the completion of TWI's initial public offering, CRW has accounted
for its investment in TWI under the equity method of accounting. As a result,
the accounts of TWI have not been consolidated into CRW's financial statements
for the periods ended September 30, 1996. In August, 1996, CRW recorded a $53.17
million increase to its investment in TWI account to reflect TWI's initial
public offering.

         In October 1996, the CRW's Board of Directors announced that it
intended to sell the assets of its receivables management, administration and
debt collection business and spin-off the Casino Money Centers, Inc. subsidiary
to CRW shareholders.

2.  BASIS OF PRESENTATION:

         The accompanying unaudited consolidated financial statements have been
prepared in conformity with generally accepted accounting principles. The
interim financial information, while unaudited, reflects all normal recurring
adjustments which are, in the opinion of management, necessary for a fair
presentation of the interim financial statements. The results for the three
months and nine months are not necessarily indicative of results expected for
the full year. These financial statements should be read in conjunction with the
audited financial statements and the notes thereto included in the CRW
Financial, Inc. Annual Report on Form 10-K for the year ended December 31, 1995.


                                       -6-

<PAGE>


3.  NET INCOME (LOSS) PER COMMON SHARE

         Net income (loss) per common share for 1995 was computed on a pro forma
basis using the weighted average number of shares of CRW stock and common share
equivalents outstanding as if the distribution of 2,648,787 shares of CRW common
stock by CCS was made on January 1, 1995. In addition, since CRW common stock
equivalents exceed 20% of the CRW common stock outstanding, the modified
treasury stock method pursuant to Accounting Principles Board Statement No. 15
was utilized to calculate weighted average number of shares of CRW common stock
outstanding, including shares of CRW common stock issuable pursuant to exercises
of the CCS warrants, 1,500,000 of stock options issued to management of CRW
(which have exercise prices between $0.97 and $1.94 per share) and the warrant
to purchase 273,054 shares of common stock described in Note 4 below. Pro forma
net income per common share for discontinued operations has been computed using
the same weighted average number of common stock equivalents used to compute per
share amounts from continuing operations. Net loss per common share in 1996 was
computed based upon the weighted average number of common shares outstanding
during 1996 as common stock equivalents were anti-dilutive in 1996 due to the
net loss.

4.  DEBT

         In connection with the merger and Distribution, CRW assumed the bank
debt of CCS and immediately refinanced it with proceeds from a $6,000,000
three-year revolving line of credit from a bank which bears interest at that
bank's prime rate plus 1 1/2%. In connection with the revolving credit loan, CRW
has issued to the bank warrants to purchase 273,054 shares of its common stock
at an average exercise price of $0.91 per share. Borrowings under the line of
credit are collateralized by substantially all of the assets of CRW. On
September 19, 1996, the bank amended the Loan and Security Agreement to increase
the Company's available borrowings under the line of credit to $7,500,000 until
December 31, 1996. Available borrowings under the line will be reduced to
$6,500,000 on December 31, 1996 and the loan is due in full on March 18, 1997 or
upon the sale of the company's collection business. The Company has pledged
6,162,130 shares of its TWI stock as collateral for the loan.

         On May 23, 1996, CRW issued $2,100,000 of subordinated notes to certain
shareholders and employees. The subordinated notes were repaid in September 1996
with proceeds from the bank loan. The subordinated notes bore interest at 12.5%
and were originally due in quarterly installments of $262,500 beginning on
January 1, 1997. Proceeds from the subordinated notes were used to capitalize
TeleSpectrum Worldwide Inc. ("TWI") (see note 6). In connection with the
subordinated notes, CRW issued warrants to the subordinated lenders and to CRW's
bank to purchase 1,433,454 and 74,445 shares of TWI common stock, respectively,
from CRW for $1.50 per share. The Company obtained an appraisal which indicated
that the warrants had a fair value of $0.75 per warrant on May 23, 1996.
Accordingly, the debt was discounted $1,131,000 to reflect the value of the
warrants. The repayment of the subordinated debt in September 1996 resulted in
an extraordinary loss of $746,000 on the early extinguishment of the debt for
the $1,131,000 discount, net of a tax benefit of $385,000.


                                       -7-

<PAGE>


5.  OTHER ASSETS
                                 
Other assets include the following:

                                  December 31, 1995     September 30, 1996

Investment in RTC Partnerships         $310,000              $398,000
Deposits                                147,000               180,000
Notes Receivable                        107,000                88,000
Deferred Tax Asset                      403,000                  --
                                       --------              --------
                                       $967,000              $666,000
                                       ========              ========
                                                                              
6.  TELESPECTRUM WORLDWIDE INC.

         On April 29, 1996 CRW formed a wholly owned subsidiary, TeleSpectrum
Worldwide Inc. ("TWI"). TWI entered into asset purchase agreements to acquire
six teleservices businesses for approximately $139,000,000 in cash and TWI
common stock. CRW made a $2,100,000 capital contribution to TWI on May 23, 1996.
On May 23, 1996, in connection with the acquisitions and inital public offering,
CRW issued warrants to its CEO, CFO, Director of Acquisitions and a consultant
to purchase 839,108 shares of TWI stock from CRW at $1.50 per share. The Company
obtained an appraisal which indicated that the warrants had a fair value of
$0.75 per warrant on May 23, 1996. Accordingly, the Company recorded a non-cash
compensation charge of $629,000 on May 23, 1996.

         In September, 1996, certain subordinated lenders described in Note 4
exercised warrants to purchase 784,997 shares of TWI stock from CRW at $1.50 per
share. As a result, the Company recorded a gain on the sale of $1,176,000. After
these exercises, CRW owns 7,725,140 shares of TWI common stock. If all of the
remaining warrants to purchase TWI stock are exercised, CRW will receive
approximately $2,345,000 of cash and would then own 6,162,130 shares of TWI.

7.  STOCK SPLIT

         On October 3, 1996, subsequent to the stockholders' vote approving an
increase in the Company's authorized common stock from 5,000,000 shares to
20,000,000 shares, the Company's Board of Directors approved a three-for-one
stock split payable on October 24, 1996 to stockholders of record on October 14,
1996. All share and per share information in this report has been retroactively
adjusted to reflect this stock split as if it occurred on January 1, 1995.

8.  SPECIAL COMPENSATION CHARGES

         In connection with the Board of Directors' intention to sell the assets
of the Company's collection division, the Company recorded a $690,000 provision
for severence pay related to several terminated employees. In addition, in May,
1996, the Company recorded a $629,000 non-cash compensation charge for the
TeleSpectrum warrants described in Note 6.


                                       -8-

<PAGE>


9.  DISCONTINUED OPERATIONS

         In connection with CRW's investment in TeleSpectrum Worldwide, CRW
agreed to terminate the operations of its market research division and allow TWI
to offer employment to any of the division's employees. TWI also agreed to
assume a lease for one of the division's facilities. During the third quarter of
1996. The division ceased operations and incurred a loss during the quarter of
$308,000. The loss was primarily due to severence, lease termination costs and
bad debt expenses.

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

Continuing Operations

         Below is a summary of operating results (in thousands) for the
Company's two business segments, CRW Financial and Casino Money Centers.

                                         Thirteen Weeks Ended September 30, 1996
                                         ---------------------------------------
                                               CRW        Casino
                                            Financial  Money Centers    Total
                                            ---------  -------------  ----------
Net Revenues                                 $ 6,120      $   901     $ 7,021
Operating Expenses,
   excluding non-cash and special charges      7,181          837       8,018
Special Compensation Charge                      690         --           690
Depreciation                                     232            6         238
Amortization                                     116            7         123
                                             -------      -------     -------
Operating Income (Loss)                      $(2,099)     $    51     $(2,048)
                                             =======      =======     =======




                                         Thirteen Weeks Ended September 30, 1995
                                         ---------------------------------------
                                            CRW          Casino
                                         Financial    Money Centers      Total
                                         ---------    -------------      -----
Net Revenues                               $ 7,021        $   899       $ 7,920
Operating Expenses,
   excluding non-cash charges                7,147            640         7,787
Depreciation                                   187              1           188
Amortization                                   146              5           151
                                           -------        -------       -------

Operating Income (Loss)                    $  (459)       $   253       $  (206)
                                           =======        =======       =======



                                       -9-

<PAGE>

                                      Thirty-Nine Weeks Ended September 30, 1996
                                      ------------------------------------------

                                              CRW        Casino
                                           Financial  Money Centers    Total  
                                           ---------  -------------    -----
Net Revenues                                $ 20,415     $  2,654    $ 23,069   
Operating Expenses,                                                             
   excluding non-cash and special charges     20,762        2,382      23,144   
Special Compensation Charges                   1,319         --         1,319   
Depreciation                                     683           16         699   
Amortization                                     350           20         370   
                                            --------     --------    --------   
                                                                                
Operating Income (Loss)                     $ (2,699)    $    236    $ (2,463)  
                                            ========     ========    ========   
                                                                                
                                                                                
                                      Thirty-Nine Weeks Ended September 30, 1995
                                      ------------------------------------------

                                           CRW          Casino
                                         Financial   Money Centers     Total
                                         ---------   -------------     -----
Net Revenues                              $22,035       $ 2,221       $24,256   
Operating Expenses,                                                             
   excluding non-cash charges              20,885         1,705        22,590   
Depreciation                                  482             2           484   
Amortization                                  630            16           646   
                                          -------       -------       -------   
Operating Income                          $    38       $   498       $   536   
                                          =======       =======       =======   
                                                                             
Thirteen Weeks Ended September 30, 1996 and September 30, 1995

         Net Revenues. Net revenues for the thirteen weeks ended September 30,
1996 decreased $899,000 (11.4%) to $7,021,000 from $7,920,000 for the thirteen
weeks ended September 30, 1995.

         CRW Financial's revenues for the thirteen weeks ended September 30,
1996 decreased $901,000 (12.8%) to $6,120,000 compared to $7,021,000 for the
thirteen weeks ended September 30, 1995. The decrease was primarily due to a
decrease in the Company's commission rate on a new contract signed with the
California Student Aid Commission (CSAC) in June 1996 and the loss of revenues
from the New Jersey Department of Motor Vehicles.

         Casino Money Centers, Inc. revenues for the thirteen weeks ended
September 30, 1996 increased $2,000 to $901,000, from $899,000 for the thirteen
weeks ended September 30, 1995.

                                      -10-

<PAGE>


         Operating Expenses. Operating expenses increased $943,000 (11.6%) to
$9,069,000 for the thirteen weeks ended September 30, 1996 from $8,126,000 for
the thirteen weeks ended September 30, 1995.

         CRW Financial's operating expenses increased 739,000 (9.9%) to
$8,219,000 for the thirteen weeks ended September 30, 1996 from $7,480,000 for
the thirteen weeks ended September 30, 1996 primarily due to a $690,000 charge
for severance pay related the planned sale of the collection business.

         Casino Money Centers, Inc.'s operating expenses increased $204,000
(31.6%) to $850,000 for the thirteen weeks ended September 30, 1996, from
$646,000 for the thirteen weeks ended September 30, 1995 primarily due to
increased volume at the Oneida facility and a higher expense for profit sharing
with the Oneida Casino.

         Depreciation expense increased $50,000 to $238,000 for the thirteen
weeks ended September 30, 1996 from $188,000 for the thirteen weeks ended
September 30, 1995 due to capital expenditures of $1,525,000 in 1995.

         Amortization decreased $28,000 to $123,000 for the thirteen weeks ended
September 30, 1996 from $151,000 for the thirteen weeks ended September 30, 1995
due to the expiration in July 1995 of a $3,000,000 three-year non-compete
agreement with TRW Inc.

         Operating Income (Loss). The Company generated an operating loss of
$2,048,000 for the thirteen weeks ended September 30, 1996 compared to a
$206,000 operating loss for the thirteen weeks ended September 30, 1995 due to
the decrease in revenue of $899,000 and the increase in operating expenses of
$943,000.

         Interest Expense. Interest expense for the thirteen weeks ended
September 30, 1996 increased $72,000 to $224,000 compared to $152,000 for the
thirteen weeks ended September 30, 1995 primarily due to interest on the
$2,100,00 of subordinated notes issued to finance CRW's investment in TWI.

         Income Tax Benefit. The income tax benefit (excluding income tax
benefits on discontinued operations and the extraordinary items) was $(380,000)
for the thirteen weeks ended September 30, 1996 compared to $(133,000) for the
thirteen weeks ended September 30, 1995, reflecting effective tax rates of 35%
and 37%, respectively.

Thirty-Nine Weeks Ended September 30, 1996 and September 30, 1995

         Net Revenues. Net revenues for the thirty-nine weeks ended September
30, 1996 decreased $1,187,000 (4.9%) to $23,069,000 from $24,256,000 for the
thirty-nine weeks ended September 30, 1995.


                                      -11-


<PAGE>


         CRW Financial's revenues for the thirty-nine weeks ended September 30,
1996 decreased $1,620,000 (7.4%) to $20,415,000 from $22,035,000 for the
thirty-nine weeks ended September 30, 1996 primarily due to the decreased
revenues in the third quarter of 1996 related to the lower commission rate on
the CSAC contract, the loss of revenues in 1996 from Bell South which generated
approximately $500,000 of revenues in 1995, the loss of revenues from the New
Jersey Department of Motor Vehicles.

         Casino Money Centers revenues increased $433,000 (19.5%) to $2,654,000
for the thirty-nine weeks ended September 30, 1996 from $2,221,000 for the
thirty-nine weeks ended September 30, 1995 due to increased volume at the Oneida
facility and the opening of the Northstar facility.

         Operating Expenses. Operating expenses increased $1,812,000 (7.6%) to
$25,532,000 for the thirty-nine weeks ended September 30, 1996 from $23,720,000
for the thirty-nine weeks ended September 30, 1995.

         CRW Financial's operating expenses increased $1,117,000 (5.1%) to
$23,114,000 for the thirty-nine weeks ended September 30, 1996, from $21,997,000
for the thirty-nine weeks ended September 30, 1995 primarily due to the special
compensation charges of $1,319,000.

         Casino Money Centers Inc.'s operating expenses increased $695,000
(40.3%) to $2,418,000 for the thirty-nine weeks ended September 30, 1996, from
$1,723,000 for the thirty-nine weeks ended September 30, 1995 primarily due to
increased volume at the Oneida facility and the opening of the Northstar
facility.

         Depreciation expense increased $215,000 to $699,000 for the thirty-nine
weeks ended September 30, 1996 from $484,000 for the thirty-nine weeks ended
September 30, 1995 due to capital expenditures of $1,525,000 in 1995.

         Amortization decreased $276,000 to $370,000 for the thirty-nine weeks
ended September 30, 1996 from $646,000 for the thirty-nine weeks ended September
30, 1995 due to the July 1996 expiration of a $3,000,000 three year non-compete
agreement with TRW Inc.

         Operating Income (Loss). The Company generated an operating loss of
$2,463,000 for the thirty-nine weeks ended September 30, 1996 compared to
$536,000 of operating income for the thirty-nine weeks ended September 30, 1995
due to the $1,187,000 decerease in revenues and the $1,812,000 increase in
operating expenses.

         Interest Expense. Interest expense for the thirty-nine weeks ended
September 30, 1996 increased $205,000 to $593,000 compared to $388,000 for the
thirty-nine weeks ended September 30, 1995 due to the $2,100,000 of subordinated
debt issued to finance CRW's investment in TWI.


                                      -12-

<PAGE>


         Income Taxes. The Income tax benefit were $639,000 (excluding income
tax benefits on discontinued operations and the extraordinary item) for the
thirty-nine weeks ended September 30, 1996 compared to a $56,000 income tax
provision for the thirty-nine weeks ended September 30, 1995, reflecting
effective tax rates of approximately 34% and 38%, respectively.

Discontinued Operations

         Below is a summary of the operating results for CRW's Market Research
Division which began operations in January 1996 and ceased operations in August,
1996 and for CCI which was sold in May 1995. Both businesses have been
classified as discontinued operations. (See Note 2).

<TABLE>

<CAPTION>

                                                     (In thousands)

                                                                       Thirteen               Thirty-Nine
                                              Period Ended           Weeks Ended              Weeks Ended
                                              May 11, 1995       September 30, 1996        September 30, 1996
                                              ------------       ------------------        ------------------

<S>                                              <C>                    <C>                     <C>    
Net Revenues                                     $ 3,326                $   147                 $ 1,503
Operating Expenses,
       excluding non-cash charges                  1,917                    609                   2,306
Depreciation                                          74                      4                       4
Amortization                                         454                   --                      --
                                                 -------                -------                 -------
Operating Income (loss)                              881                   (466)                   (807)
Income Taxes                                         314                   (158)                   (274)
                                                 -------                -------                 -------

Net Income (loss)                                $   567                $  (308)                $  (533)
                                                 =======                =======                 =======

</TABLE>


INFLATION

         Inflation has not had a significant impact on the Company's operations
to date.

LIQUIDITY AND CAPITAL RESOURCES

         During the thirty-nine weeks ended September 30, 1996 net cash used in
operating activities was $2,023,000 compared to $123,000 of cash provided by
operating activities for the thirty-nine weeks ended September 30, 1995. The
cash used in operating activities in the 1996 period was primarily due to the
Company's operating loss, a $384,000 decrease in accounts payable, a $412,000
increase in accounts receivable, and a $456,000 increase in other assets. The
cash provided by operating activities in the 1995 period was primarily due to
the Company's operating income, partially offset by a $167,000 increase in
accounts receivable and a $1,520,000 decrease in accrued expenses.

         Net cash used in investing activities during the thirty-nine weeks
ended September 30, 1996 was $2,600,000 and consisted of the $2,110,000
investment in TWI and $490,000 of capital expenditures.


                                      -13-

<PAGE>


         Net cash provided by financing activities during the thirty-nine weeks
ended September 30, 1996 was $4,010,000 and consisted of $2,382,000 of proceeds
from the sale of preferred stock, $2,000,000 of borrowings under the line of
credit, $455,000 of proceeds from the exercise of options to purchase common
stock, partially offset by $795,000 of repayments of long-term debt.

         The Company believes that its existing cash on hand, cash to be
generated from future operations, cash to be generated from the exercise of
warrants and options and cash to be generated from the planned sale of the
collection business will be adequate to meet its needs through the foreseeable
future.

PART II - OTHER INFORMATION

         No matters were submitted to a vote of stockholders during the third
quarter of 1996.


ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K

         Form 8-K filed August 22, 1996.



                                      -14-

<PAGE>

                                   SIGNATURES

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


                                   CRW FINANCIAL, INC.
                                   (Registrant)


Date:    November 14, 1996         _____________________________________________
                                   Jonathan P. Robinson, Chief Financial Officer


                                      -15-