UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                         Washington, DC  20549

                           FORM 10-KSB

X  ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES ACT OF 1934

               For the fiscal year ended March 31, 2000


   TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
   EXCHANGE ACT OF 1934 (NO FEE REQUIRED)

        For the transition period from ________ to _________.

                   Commission file number: 0-26680



                       NICHOLAS FINANCIAL, INC.
            (Name of Small Business Issuer in its Charter)

       British Columbia, Canada                   8736-3354
   (State or Other Jurisdiction of             (I.R.S. Employer
    Incorporation or Organization            Identification No.)

 2454 McMullen Booth Road, Building C
        Clearwater, Florida                         33759
(Address of Principal Executive Offices)          (Zip Code)

           Issuer's Telephone Number, Including Area Code:
                            (727) 726-0763
                                                 Name of Each Exchange
     Title of Each Class                          on Which Registered

Common Stock, Par Value $0.01 Per Share                  NASDAQ
      __________________                           __________________
      __________________                           __________________

    Securities registered under Section 12(g) of the Exchange Act:




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


Check  if  disclosure of delinquent filers pursuant  to  Item  405  of
regulation  S-B is not contained in this form, and no disclosure  will
be contained, to the best of the registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part  III
of this Form 10-KSB or any amendment to this Form 10-KSB.  [X]

The  issuer's revenues for the recent fiscal year ended March 31, 2000
were $14,074,816
As  of May 31, 2000, 2,352,008 shares of the Registrant's common stock
were outstanding, and the aggregate market value of the shares held by
non-affiliates was approximately $6,811,774

DOCUMENTS INCORPORATED BY REFERENCE:
     Proxy Statement, dated on or about July 3, 2000.
     Part III, Items 9, 10, 11 and 12 Form 10-KSB Reference

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


<PAGE> 1

                       NICHOLAS FINANCIAL, INC.
                       FORM 10-KSB ANNUAL REPORT
                           TABLE OF CONTENTS

PART I                                                   Page No.

     Item 1.      Description of Business.....................3
     Item 2.      Description of Properties..................12
     Item 3.      Legal Proceedings..........................12
     Item 4.      Submission of Matters to a Vote of
                   Security Holders..........................12

PART II

     Item 5.      Market for Common Equity and Related
                   Stockholder Matters.......................13
     Item 6.      Management's Discussion and Analysis
                   of Financial Condition and Results of
                   Operations................................14
     Item 7.      Financial Statements.......................20
     Item 8.      Changes In and Disagreements With
                   Accountants on Accounting and
                   Financial Disclosure......................41

PART III

     Item 9.      Directors, Executive Officers, Promoters
                   and Control Persons; Compliance with
                   Section 16 (a) of the Exchange Act........41
     Item 10.     Executive Compensation.....................42
     Item 11.     Security Ownership of Certain Beneficial
                   Owners and Management.....................42
     Item 12.     Certain Relationships and Related
                   Transactions..............................42
     Item 13.     Exhibits and Reports on Form 8-K...........44


<PAGE> 2


Forward-Looking Information

      This  report  on  Form  10-KSB contains various  forward-looking
statements within the meaning of Section 27A of the Securities Act  of
1933  and  Section  21E of the Securities Exchange  Act  of  1934  and
information that is based on management's beliefs and assumptions,  as
well  as information currently available to management.  When used  in
this  document,  the  words  "anticipate," "estimate,"  "expect,"  and
similar   expressions   are   intended  to  identify   forward-looking
statements.    Although  Nicholas  Financial,  Inc.,   including   its
subsidiaries ("the Company"), believes that the expectations reflected
in  such  forward-looking statements are reasonable, it  can  give  no
assurance  that  such  expectations will prove  to  be  correct.  Such
statements   are   subject   to  certain  risks,   uncertainties   and
assumptions.   Should  one  or more of these  risks  or  uncertainties
materialize, or should underlying assumptions prove incorrect,  actual
results  may  vary  materially from those  anticipated,  estimated  or
expected.   Among  the key factors that may cause  actual  results  to
differ  materially from those projected in forward-looking  statements
include  fluctuations  in  the  economy,  the  degree  and  nature  of
competition,  fluctuations  in interest  rates,  demand  for  consumer
financing in the markets served by the Company, the Company's products
and  services,  increases in the default rates experienced  on  retail
installment  sales  contracts,  adverse  regulatory  changes  in   the
Company's  existing and future markets, and the Company's  ability  to
expand  its  business, including its ability to complete  acquisitions
and  integrate the operations of acquired businesses, to  recruit  and
retain qualified employees, to expand into new markets and to maintain
profit  margins  in  the  face of increased pricing  competition.  All
forward-looking  statements  included in  this  report  are  based  on
information  available  to the Company on the  date  hereof,  and  the
Company  assumes  no  obligation to update  any  such  forward-looking
statement.  Prospective  investors  should  also  consult   the   risk
described  from time to time in the Company's reports on forms  10-QSB
and 10-KSB and annual reports to shareholders.

<PAGE> 3

                                PART I
Item 1.     Description of Business

General

      Nicholas  Financial,  Inc. ("Nicholas  Financial-Canada")  is  a
Canadian  holding  company  incorporated under  the  laws  of  British
Columbia  in  1986.   The business activities of  Nicholas  Financial-
Canada  are  conducted  through its wholly-owned  subsidiaries  formed
pursuant to the laws of the State of Florida, Nicholas Financial, Inc.
("Nicholas  Financial")  and Nicholas Data  Services,  Inc.,  ("NDS").
Nicholas  Financial is a specialized consumer finance company  engaged
primarily  in  acquiring  and  servicing installment  sales  contracts
("Contracts")  for  purchases of new and used  automobiles  and  light
trucks.  To  a  lesser extent, the Company also makes direct  consumer
loans   and   sells  consumer-finance  related  products   ("Insurance
Products").   NDS is engaged in designing, developing,  marketing  and
supporting  industry specific computer application software for  small
businesses located primarily in the Southeast United States.  Nicholas
Financial's  financing activities accounted for approximately  96%  of
consolidated  revenues for the fiscal year ended March  31,  2000  and
NDS's  activities  accounted for approximately  4%  of  such  revenues
during the same period.

       Nicholas  Financial-Canada,  Nicholas  Financial  and  NDS  are
hereafter collectively referred to as the "Company".  Unless otherwise
specified,  all financial information herein is designated  in  United
States currency.

      The  Company's principal executive offices are located  at  2454
McMullen  Booth  Road, Building C, Clearwater Florida 33759,  and  its
telephone number is (727) 726-0763.

Automobile Finance Business

      The  Company  is engaged in the business of providing  financing
programs, primarily on behalf of purchasers of new and used  cars  and
light  trucks who meet the Company's credit standards, but who do  not
meet  the  credit standards of traditional lenders, such as banks  and
credit  unions,  because  of the age of the  vehicle  being  financed,
and/or  the  customer's  job  instability or  credit  history.  Unlike
traditional lenders, which look primarily to the credit history of the
borrower  in  making  lending  decisions  and  typically  finance  new
automobiles,  the  Company  is willing to purchase  installment  sales
contracts  for  purchases made by borrowers who do  not  have  a  good
credit  history  and for older model and high mileage automobiles.  In
making  decisions  regarding the purchase of a particular  installment
sales contract the Company considers the following factors related  to
the  borrower:  place and length of residence, current and  prior  job
status,  history  in  making  installment  payments  for  automobiles,
current  income and credit history. In addition, the Company  examines
its  prior  experience with Contracts purchased from the  dealer  from
which  the  Company is purchasing the Contract, and the value  of  the
automobile  in  relation to the purchase price and  the  term  of  the
installment sales contract.

     The Company's automobile finance programs are currently conducted
in  Florida,  Georgia and North Carolina only under the name  Nicholas
Financial, Inc. The Company currently operates thirteen branch offices
in  Florida, three branch offices in Georgia and one branch office  in
North  Carolina.   As of March 31, 2000 the Company had  non-exclusive
agreements with approximately 700 dealers for the purchase  of  retail
installment sales contracts (the "Contracts") that meet the  Company's
financing  criteria.   The dealer agreements  require  the  dealer  to
originate Contracts in accordance with the Company's guidelines.

      From July 1990 through March 31, 2000, the Company had purchased
24,320   Contracts  with  an  initial  principal  amount   aggregating
approximately  $173,722,275. The average initial principal  amount  of
Contracts purchased by the Company was $7,143 and the contracts had an
average initial term of 37 months.  The Contracts were purchased  from
dealers  at  an  average discount of approximately 10.36%  from  their
initial principal amount.

<PAGE> 4

     The obligors under the Contracts typically make down payments, in
the form of cash or trade-in, ranging from 5% to 20% of the sale price
of  the  vehicle financed.  The balance of the purchase price  of  the
vehicle  plus  taxes,  title  fees and, if  applicable,  premiums  for
extended  service  contracts,  accident and  health  insurance  and/or
credit life insurance, are generally financed over a period of  12  to
60  months.   Accident  and  health  insurance  coverage  enables  the
borrower to make required payments under the Contract in the event the
borrower  becomes unable to work because of illness  or  accident  and
credit  life  insurance  pays  the borrower's  obligations  under  the
Contract upon his or her death.

      The  annual  percentage  rate ("APR")  is  the  actual  cost  of
borrowing money, expressed in form of the annual interest rate payable
by the borrower.  The APR for Contracts purchased by the Company range
from  18%  to 30%. As of March 31, 2000, the average APR on  Contracts
purchased and currently outstanding is 23.97% and the average discount
from the initial principal amount is 8.93%.

      The Company purchases Contracts from the automobile dealer at  a
negotiated price that is less than the original principal amount being
financed  {the  discount} by the purchaser  of  the  automobile.   The
amount of the discount depends upon factors such as the age and  value
of  the  automobile  and the credit worthiness of  the  purchaser.  In
certain  markets, competition determines the discount that the company
can  charge. Historically, the Contracts purchased by the Company have
been  purchased at discounts that range from 5% to 30% of the original
principal  amount of the Contract.  In addition to the  discount,  the
Company  charges  the  dealer a processing fee  of  $75  per  Contract
purchased.  Virtually  all Contracts purchased by  the  Company  since
April  1,  1992  have  been purchased from dealers  without  recourse,
meaning that the Company, not the dealer, bears the risk of nonpayment
by  the  borrower  under the Contract. Prior to  April  1,  1992  some
Contracts  were  acquired with full recourse against  the  dealer  for
nonpayment  by the borrower.  As of March 31, 2000, substantially  all
of  the  Company's  loan portfolio consisted of  Contracts  that  were
purchased without recourse against the dealer.  Although substantially
all  the  Contracts  in  the Company's loan  portfolio  were  acquired
without  recourse,  the  dealer remains  liable  to  the  Company  for
liabilities  arising from certain representations and warranties  made
by  the dealer with respect to compliance with applicable federal  and
state laws and valid title to the vehicle.

      The  Company purchases a Contract only after the dealer (seller)
and  the Company arrive at a negotiated price for the Contract and the
dealer  has  provided the Company with the requisite  proof  that  the
vehicle  is  properly titled, that the Company has a  perfected  first
priority  lien on the financed vehicle, that the customer has obtained
the  required collision insurance naming the Company as loss payee and
the installment sales contract has been fully and accurately completed
and  validly executed. Once the Company has received and approved  all
required  documents, it pays the dealer for the Contract and commences
servicing the Contract through maturity.

      The  Company  requires the owner of the vehicle  to  obtain  and
maintain  collision insurance, naming the Company as the  loss  payee,
with  a deductible of not more than $500.  The Company does not  offer
collision insurance. Both the Company and its dealers offer purchasers
of  vehicles  certain  other  "add on products".  These  products  are
offered  by  the dealer on behalf of the Company or by the  automobile
dealer  on behalf of the dealership at the time of sale. They  consist
of  a  roadside assistance plan, extended warranty protection,  credit
life  insurance,  credit  accident and  health  insurance  and  credit
property  insurance. If the purchaser so desires, the  cost  of  these
products  may  be included in the amount financed under the  Contract.
As  of  March  31,  2000,  approximately 20% of  the  borrowers  under
Contracts in the Company's loan portfolio had elected to purchase "add
on products".

<PAGE> 5

Direct Consumer Loans

      Although  the Company is licensed to make small direct  consumer
loans up to $25,000, the average loan made to date by the Company  had
an initial principal balance of approximately $2,500. The Company does
not  expect the average loan size to increase significantly within the
foreseeable future and does not presently intend to make loans at  the
maximum  size  permitted under its license.  The Company offers  loans
primarily to borrowers under the Contracts previously purchased by the
Company.   In  deciding whether or not to make  a  loan,  the  Company
considers  the individual's credit history, job stability, income  and
impressions  created during a personal interview with a  Company  loan
officer.   Additionally,  because  approximately  90%  of  the  direct
consumer  loans  made  to  date  have been  made  to  borrowers  under
Contracts previously purchased by the Company, the payment history  of
the  borrower under the Contract is a significant factor in making the
loan  decision.   The direct consumer loan program was implemented  in
April  1995  and is not currently a significant source of revenue  for
the Company.  As of March 31, 2000, loans made by the Company pursuant
to  its direct consumer loan program constituted approximately 4.3% of
the aggregate principal amount of the Company's loan portfolio.  As of
March 31, 2000, the average APR for direct consumer loans made by  the
Company  was 25.54%, with a range of 18 to 30%. The Company  currently
purchases  between  400  and 700 indirect  contracts  each  month  and
originates between 50 and 100 direct consumer loans each month.

      In  connection with its direct consumer loan program the Company
also  offers  health and accident insurance coverage and  credit  life
insurance  to borrowers.  Borrowers in approximately 60% of the  1,009
direct consumer loan transactions outstanding as of March 31, 2000 had
elected  to  purchase insurance coverage offered by the Company.   The
cost  of  this  insurance is included in the amount  financed  by  the
borrower.


Financing Sources

      The  Company  finances  the acquisition of  Contracts  with  its
retained  earnings, cash flow from operations, loans  from  investors,
insiders  and a revolving line of credit with BankAmerica. In November
1999  the Company expanded its line of credit capacity to $45 million,
extended  the  maturity  date of such line to November  30,  2002  and
reduced the rate of interest payable under the line. No assurance  can
be  given  that  the size of the line will be increased  or  that  the
maturity date will be extended beyond November 30, 2002.

     As of March 31, 2000, the Company owed approximately $1.3 million
to  seven  investors who purchased notes issued by the Company.  These
notes  bear  interest at rates from 10.5 % to 12%. In most cases,  the
Company's  obligation to repay the note is subordinated to payment  of
its obligations under the BankAmerica line of credit.

      The  BankAmerica line of credit is secured by all assets of  the
Company. The interest rate payable by the Company on funds drawn under
the line of credit is based on either the current prime rate published
by  BankAmerica  or  several Libor pricing  options.  In  addition  to
interest, the Company also pays a monthly fee to BankAmerica equal  to
 .25%  of  the amount available under the line of credit that  has  not
been  drawn  upon.  As  of  March 31,  2000,  the  Company  had  drawn
approximately  $38  million under the line of credit.   The  revolving
line expires on November 30, 2002.

<PAGE> 6

Underwriting Guidelines

      The  Company's typical customer is 30 years old, has  a  monthly
gross  income of $1,500 and a credit history that fails  to  meet  the
lending  standards of most banks and credit unions.  Among the  credit
problems  experienced by the Company's customers that  resulted  in  a
poor  credit  history are: unpaid revolving credit  card  obligations;
unpaid  medical  bills;  unpaid student loans; prior  bankruptcy;  and
evictions  for  nonpayment  of rent.  The Company  believes  that  its
customer profile is similar to that of its direct competitors.

      Prior to its approval of the purchase of a Contract, the Company
is  provided with a standardized credit application completed  by  the
consumer   which  contains  information  relating  to  the  consumer's
background,  employment, and credit history. The Company also  obtains
credit  reports from Equifax, TRW or TransUnion which are  independent
reporting  services.  The Company verifies the  consumer's  employment
history, income and residence. In most cases consumers are interviewed
by telephone by a Company application processor.

      The  Company  utilizes internal buying guidelines  used  by  its
Branch  Managers  and  underwriters  when  purchasing  Contracts.  Any
Contract that does not meet these guidelines must be approved  by  the
senior  management  of the Company. The Company  currently  has  three
Regional  Managers charged with managing the specific  branches  in  a
defined  geographic area. In addition to a variety  of  administrative
duties,  the  Regional Managers are responsible for  monitoring  their
assigned   branch's   compliance  with  the   Company's   underwriting
standards.

       The   Company  continues  to  utilize  its  Special  Operations
Department ("SOD") to perform on-site audits of branch compliance with
Company  buying  guidelines.  SOD will audit  Company  branches  on  a
schedule that is variable depending on the size of the branch,  length
of  time  a  branch has been open, current tenure of  branch  manager,
previous  branch  audit  score  and  current  and  historical   branch
profitability.   SOD   reports  directly   to   the   Accounting   and
Administrative Management of the Company. The Company believes that an
independent review and audit of its branches that is not tied  to  the
sales  function of the Company is imperative, in order to  assure  the
information obtained is impartial.

      The  Company uses essentially the same criteria in  analyzing  a
direct  consumer  loan  as  it does in analyzing  the  purchase  of  a
Contract. Lending decisions regarding direct consumer loans  are  made
based  upon  a  review  of  the customer's  loan  application,  credit
history,  job stability, income, in-person interviews with  a  Company
loan  officer and the value of the collateral offered by the  borrower
to secure the loan.  To date, since approximately 90% of the Company's
direct loans have been made to individuals whose automobiles have been
financed  by  the  Company, the customer's payment history  under  the
automobile installment sale agreement is a significant factor  in  the
lending  decision.  The decision process with respect to the  purchase
of Contracts is similar, although the customer's prior payment history
with  automobile loans is weighted more heavily in the decision making
process  and the collateral value of the automobile being financed  is
considered.

      After reviewing the information included in the loan application
and  taking  the  other factors into account, Company  representatives
categorize   the   borrower   using   internally   developed    credit
classifications of "A", indicating high creditworthiness, through "D",
indicating lower creditworthiness.

      In  the  absence  of other factors, such as a favorable  payment
history on a Contract held by the Company, the Company generally makes
direct  consumer loans only to individuals rated in categories "B"  or
higher.   Contracts are financed for individuals who fall  within  all
four  acceptable rating categories utilized, "A" through "D".  Usually
borrowers who fall within the two highest categories are purchasing  a
two  to  four year old, low mileage used automobile from the inventory
of  a new car or (franchise dealer), while borrowers in the two lowest
categories  are purchasing an older, high mileage automobile  from  an
independent  used automobile dealer.  Approximately 5%  of  the  loans
financed  by the Company are with customers rated in the "A" category,
15% are rated "B", 70% are rated "C" and 10% are rated "D".

<PAGE> 7

      Upon  credit  approval of the customer and the  receipt  of  all
required  title  and  insurance documentation, the  Company  pays  the
dealer for the Contract.  The Company typically purchases the Contract
for  a  price that approximates the wholesale value of the  automobile
being financed.  The amount the Company is willing to pay a dealer for
a  particular Contract depends upon the credit rating of the customer.
The  Company  will pay more (e.g. purchase the Contract at  a  smaller
discount  from  the original principal amount) for  Contracts  as  the
credit  risk of the customer improves. The discounts from the  initial
principal amount of Contracts purchased by the Company range  from  5%
to  30%.   The Company's current established guidelines for  discounts
are  5% for borrowers rated in the "A" category, 7.5% for those in the
"B", 10% for those in the "C" categories and 15% or more for those  in
the  "D"  category.  Purchases of Contracts at discounts that  do  not
fall within the guidelines require the prior approval of the Company's
senior management.


Servicing and Monitoring of Contracts

      The  Company  requires  all customers  to  obtain  and  maintain
collision  insurance  covering  damage  to the  vehicle.   Failure  to
maintain  insurance constitutes a default under the Contract  and  the
Company  may  at  its  discretion repossess the  vehicle.   To  reduce
potential  loss due to insurance lapse, the Company has the legal  and
contractual  right  to  force  place  its  own  collateral  protection
insurance policy which covers loss due to physical damage to  vehicles
not covered by collision insurance.

      The Company's Management Information Services personnel maintain
a  number  of  reports to monitor compliance by borrowers  with  their
obligations  under  Contracts and direct loans made  by  the  Company.
These  reports  may  be accessed on a real-time basis  throughout  the
Company by management personnel, including branch office managers  and
staff,  at  computer  terminals located in the main  office  and  each
branch  office.   The  reports  include:  delinquency  aging  reports,
insurance  due reports, customer promises reports, vehicle information
reports,  purchase  reports,  dealer  analysis  reports,  static  pool
reports, and repossession reports.

      The  delinquency report is an aging report that  provides  basic
information  regarding each account and indicates  accounts  that  are
past due.  The report includes information such as the account number,
address  of the borrower, home and work phone numbers of the borrower,
original   term  of  the  Contract,  number  of  remaining   payments,
outstanding balance, due dates, date of last payment, number  of  days
past due, scheduled payment amount, amount of last payment, total past
due, and special payment arrangements or agreements.

      Accounts that are less than 120 days matured are included on the
delinquency report on the first day that the contract is contractually
past  due. After an account has matured more than 120 days, it is  not
included on the delinquency report until it is 11 days past due.  Once
an  account  becomes  30 days past due, repossession  proceedings  are
implemented  unless  the  borrower  provides  the  Company   with   an
acceptable  explanation for the delinquency and displays a willingness
and  ability to make the payment, and there is an agreed upon plan  to
return the account to current status.  When an account is 60 days past
due,  the Company ceases amortization of the Contract and repossession
proceedings are initiated.  At 120 days delinquent, if the vehicle has
not  yet been repossessed, the account is written off.  Once a vehicle
has  been  repossessed, the related loan balance no longer appears  on
the delinquency report.  It then appears on the Company's repossession
report and is sold, either at auction or to an automobile dealer.

      When  an  account  becomes delinquent, the  Company  immediately
contacts the borrower to determine the reason for the delinquency  and
to  determine if arrangements for payment can appropriately  be  made.
Once  payment arrangements acceptable to the Company have  been  made,
the  information is entered in its database and is used to generate  a
"Promises  Report",  which  is utilized by the  collection  staff  for
account follow up.

<PAGE> 8

      The  Company generates an insurance report to monitor compliance
with  the  insurance obligations imposed upon borrowers.  This  report
includes  the  account  number,  name and  address  of  the  borrower,
information regarding the insurance carrier, summarizes the  insurance
coverage,  identifies the expiration date of the policy, and  provides
basic  information regarding payment dates and term of  the  Contract.
This  report  assists  the  Company  in  identifying  borrowers  whose
insurance  policy is up for renewal or in jeopardy of being  canceled.
The  Company sends written notices to, and makes direct contact  with,
borrowers  whose insurance policies are about to lapse or be canceled.
If  the borrower fails to provide proof of coverage within 30 days  of
notice, the Company has the option of purchasing insurance and  adding
the  cost  and  applicable  finance charges  to  the  balance  of  the
Contract.

       The  Company  prepares  a  repossession  report  that  provides
information  regarding repossessed vehicles and aids  the  Company  in
disposing   of  repossessed  vehicles.   In  addition  to  information
regarding the borrower, this report provides information regarding the
date of repossession, date the vehicle was sold, number of days it was
held  in  inventory  prior to sale, year and make  and  model  of  the
vehicle,  mileage,  payoff amount on the Contract,  NADA  book  value,
Black  Book  value,  suggested sale price, location  of  the  vehicle,
original  dealer, and notes other information that may be  helpful  to
the Company such as the condition of the vehicle.

      The Company also prepares a dealer analysis report that provides
information  regarding each dealer from which it purchases  Contracts.
This  report allows the Company to analyze the volume of business done
with  each  dealer and the terms on which it purchased Contracts  from
the dealer.

      The Company's policy is to aggressively pursue legal remedies to
collect  deficiencies from customers. Delinquency notices are sent  to
customers and verbal requests for payment are made beginning  when  an
account  becomes 11 days delinquent.  When an account becomes 30  days
delinquent   and  the  borrower  has  not  made  payment  arrangements
acceptable to the Company or has failed to respond to the requests for
payment,  a  repossession request form is prepared by the  responsible
branch  office  employee for approval by the branch  manager  for  the
vicinity  in  which the borrower lives. Once the repossession  request
has  been  approved, first by the Branch Manager and secondly  by  his
Regional Manager, it must then be approved by a corporate officer. The
repossessor delivers the vehicle to a secure location specified by the
Company  where  it  is held. The Company maintains relationships  with
several licensed repossession firms which repossess vehicles for  fees
that  range  from  $150  to  $300 for each  vehicle  repossessed.   As
required  by Florida, Georgia and North Carolina law, the customer  is
notified by certified letter that the vehicle has been repossessed and
that  to retain the vehicle he must make arrangements satisfactory  to
the Company and pay the amount owed under the Contract within ten days
after  delivery of the letter.  The minimum requirement for return  of
the  vehicle is payment of all past due amounts under the Contract and
all expenses associated with the repossession incurred by the Company.
If  satisfactory arrangements for return of the vehicle are  not  made
within  the  statutory period, the Company then  sends  title  to  the
vehicle  to  the state title transfer department which then  registers
the vehicle in the name of the Company.  The Company then either sells
the vehicle to a dealer or has it transported to an automobile auction
for  sale.  On average, approximately 30 days lapse between  the  time
the Company takes possession of a vehicle and the time it is sold by a
dealer or at auction.  During its most recent fiscal year, repossessed
vehicles have been sold at prices that average approximately $1,200 to
$1,800 less than the price paid by the Company for the Contract.  When
the  Company  determines  that there is  a  reasonable  likelihood  of
recovering  part or all of any deficiency against the  borrower  under
the  Contract, it pursues legal remedies available to it including law
suits,  judgement  liens  and  wage  garnishments.  Historically,  the
Company  has  recovered  approximately 12% of deficiencies  from  such
borrowers.

<PAGE> 9

Marketing and Advertising

      The  Company's  Contract marketing efforts are  directed  toward
automobile  dealers. The Company attempts to meet  dealers'  needs  by
offering   highly-responsive,  cost-competitive  and  service-oriented
financing  programs.  The Company relies on its  Regional  and  Branch
Managers  to  solicit agreements for the purchase  of  Contracts  with
automobile  dealers  located within a 25 mile radius  of  each  branch
office. The Branch Manager provides dealers with information regarding
the Company and the general terms upon which the Company is willing to
purchase  Contracts.  The Company presently has no plans to  implement
any  other forms of advertising for the purchase of Contracts such  as
radio or newspaper advertisements.

      Currently,  the  primary  method  utilized  by  the  Company  in
soliciting borrowers under its direct consumer loan program is through
direct mailings followed by telephone calls to individuals who have  a
good  credit history with the Company with Contracts purchased by  the
Company.  The Company intends to expand its solicitation of such loans
when  management believes its staff is adequately trained to  evaluate
credit risks associated with such loans.


The  Industry

      The non-prime automobile finance market is highly fragmented and
historically  has  been serviced by a variety of  financial  entities,
including   captive   finance   subsidiaries   of   major   automobile
manufactures,  banks, independent finance companies,  and  small  loan
companies.  Many  of  these  financial entities  do  not  consistently
provide financing to this market. Although prime borrowers represent a
large  segment  of  the automobile financing market,  there  are  many
potential  purchasers  of  automobiles who do  not  qualify  as  prime
borrowers.  Purchasers  considered by  the  Company  to  be  non-prime
borrowers  are  generally  unable to obtain  credit  from  traditional
sources  of  automobile financing. The Company believes that,  because
these potential purchasers represent a substantial market, there is  a
demand  by  automobile dealers with respect to financing for non-prime
borrowers   that  has  not  been  effectively  served  by  traditional
automobile financing sources.

      In  the past four years the Company has seen several of its most
aggressive  competitors  report unexpected  losses  due  to,  but  not
limited  to,  inadequate reserves and accounting  irregularities.  The
Company  believes the circumstances causing the industry  turmoil  are
the  result  of  poor  reserve analysis, overall lack  of  responsible
financial  management and insufficient internal controls. The  Company
believes that its static pool reserve analysis, internal controls  and
experienced  management team will enable the Company to  continue  its
history  of  accurate  and reliable financial reporting,  although  no
assurances can be given in this regard.


Computerized Information System

      The  Company's  operations utilize integrated  computer  systems
developed  by  NDS  to  enhance its ability  to  respond  to  customer
inquiries, to monitor the performance of its indirect and direct  loan
portfolio and the performance of individual borrowers under Contracts.
All  personnel  are  provided  with instant,  simultaneous  access  to
information  from a single shared database.  The Company  has  created
specialized programs to automate the tracking of loans from inception.
The  capacity  of the networking system includes the Company's  branch
office locations.  See the discussion above the caption Servicing  and
Monitoring  of  Contracts  for  a summary  of  the  different  reports
prepared by the Company.

<PAGE> 10

Strategy

      The Company's business strategy is to continue its growth and to
increase its profitability through greater penetration in its  current
markets,   controlled  geographic  expansion  into  new  markets   and
selective  portfolio acquisitions. As of the date of this report,  the
Company has no commitments or agreements in principle with respect  to
any   expansion   into  new  geographic  markets  or   any   portfolio
acquisitions.  The  Company  also intends to  continue  its  expansion
through the increased origination of additional direct consumer loans.
The Company believes that opportunity for growth continues to exist in
the  States  of  Florida, Georgia and North Carolina  and  intends  to
continue its expansion activities in such states. The Company is  also
exploring  the  possibility  of  expanding  into  other  South-Eastern
States.

Competition

       The   consumer  finance  industry  is  fragmented  and   highly
competitive.   There  are  numerous financial service  companies  that
provide consumer credit in the markets served by the Company including
banks, other consumer finance companies, and captive finance companies
owned  by  automobile  manufacturers and  retailers.   Many  of  these
companies  have significantly greater resources than the Company.  The
Company  does not believe that increased competition for the  purchase
of  Contracts will cause a reduction in the interest rate  payable  by
the  purchaser of the automobile.  However, increased competition  for
the  purchase of Contracts will enable automobile dealers to shop  for
the best price, thereby giving rise to an erosion in the discount from
the initial principal amount at which the Company would be willing  to
purchase Contracts.

     The Company's target market consists of persons who are generally
unable  to  obtain  traditional used car financing  because  of  their
credit  history, the vehicle's mileage or age.  The Company  has  been
able to expand its automobile finance business in the non-prime credit
market by offering to purchase Contracts on terms that are competitive
with those of other companies which purchase automobile receivables in
that  market segment.  Because of the daily contact that many  of  its
employees  have with automobile dealers located throughout the  market
areas  served by it, the Company is generally aware of the terms  upon
which  its  competitors  are  offering  to  purchase  Contracts.   The
Company's  policy  is  to  modify its terms  if  necessary  to  remain
competitive.  The  Company has no intention  and  will  not  sacrifice
credit  quality, its purchasing criteria or prudent business practices
in  order to meet the competition or be driven by unrealizable  growth
expectations. The Company expects to analyze new lending programs  and
marketing  methods  which may be implemented  with  the  objective  of
increasing  profits and or its market share, including the possibility
of  offering to purchase portfolios of seasoned Contracts from dealers
in bulk transactions from $50,000 to $5,000,000.

     The Company's ability to compete effectively with other companies
offering similar financing arrangements depends upon maintaining close
business  relationships with dealers of new  and  used  vehicles.   No
single  dealer out of the approximately 700 dealers that  the  Company
has  contractual  relationships with accounted  for  over  3%  of  its
business volume for the fiscal year ended March 31, 2000.

<PAGE> 11

Regulation

      The  Company's  financing operations are subject to  regulation,
supervision  and  licensing under various  Federal,  State  and  local
statutes  and ordinances.  Additionally, the procedures that  must  be
followed  by  the  Company  in connection  with  the  repossession  of
vehicles  securing Contracts are regulated by the States  of  Florida,
Georgia  and  North Carolina.  To date, the Company's operations  have
been conducted exclusively in the States of Florida, Georgia and North
Carolina.  Accordingly, the laws of such states as well as  applicable
Federal  laws,  govern  the  Company's  operations.   Compliance  with
existing laws and regulations applicable to the Company has not had  a
material  adverse  effect  on  the  Company's  operations.  Management
believes that it maintains all requisite licenses and permits  and  is
in  material  compliance with all applicable Local, State and  Federal
regulations.

     The Company maintains a Retail Installment Seller's License and a
Sales  Finance Company License with the Florida Department of  Banking
and  Finance,  the  Georgia Secretary of State  (Business  Services  &
Regulation)  and  the North Carolina Secretary of State.  Pursuant  to
regulations of the State of Florida governing the Company's  financing
business activities, the Department of Banking and Finance conducts an
on  site  audit of each of the Company's Florida branches annually  to
monitor  compliance with the applicable regulations.  The  regulations
govern, among other matters, licensure requirements, requirements  for
maintenance of proper records, payment of required fees to  the  State
of  Florida, Georgia and North Carolina, maximum interest  rates  that
may be charged on loans to finance used vehicles and proper disclosure
to customers regarding financing terms.


Employees

      The Company's executive management and various support functions
are centralized at the Company's Corporate Headquarters in Clearwater,
Florida.   As  of March 31, 2000 the Company employed a  total  of  84
persons,  five of whom work for NDS and 79 of whom work  for  Nicholas
Financial.  The Company provides paid holidays, vacation,  sick  time,
jury  time, health and life insurance, long-term disability insurance,
dental  insurance  and  a  retirement plan  that  includes  a  Company
matching formula on employee contributions as well as a Company profit
sharing  contribution for all qualified employees.  No  employees  are
covered  by a collective bargaining agreement and the Company believes
it has good relations with its employees.


<PAGE> 12

Item 2. Description of Properties

     The Company leases its Headquarters and branch office facilities.
Its  Headquarters, located at 2454 McMullen Booth Road, Building C  in
Clearwater, Florida, consists of approximately 6,800 square feet.  The
Company  occupies  the  space pursuant to a lease  that  commenced  on
January 1, 2000 and expires on December 31,  2004. The current monthly
rent  is $7,855, with annual increases of approximately 2.25% in  each
subsequent year of the lease. Management believes this office space is
adequate to meet its needs for the foreseeable future.

      Each  of  the  Company's 18 branch offices located  in  Florida,
Georgia  and  North  Carolina consists of approximately  1,200  square
feet.  These offices are located in office parks, shopping centers  or
strip  malls and are occupied pursuant to leases with an initial  term
of  from  two to five years at annual rates ranging from approximately
$8.00  to  $16.00  per  square foot. The Company believes  that  these
facilities  and  additional or alternate space  available  to  it  are
adequate to meet its needs for the foreseeable future.


Item 3. Legal Proceedings

      The  Company  is  not  a  party to any  material  pending  legal
proceedings other than ordinary routine litigation incidental  to  its
business  none  of which, in the opinion of management,  will  have  a
material  adverse effect on the Company's business, financial position
or results of operations.


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

      No  matters were submitted to a vote of security holders  during
the quarter ended March 31, 2000.


<PAGE> 13

                               PART II



Item 5. Market for Common Equity and Related Stockholder Matters

      In  September 1997, the Company applied to the NASD for approval
to  list  its common stock on NASDAQ SmallCap System. On December  23,
1997 the Company's NASDAQ application was approved and trading of  the
Company's  common  stock commenced on December  29,  1997,  under  the
symbol "NICKF". On February 17, 1998, the Board of Directors passed  a
Resolution  removing the Company's common stock from  listing  on  the
Vancouver  Stock  Exchange. Effective March 11,  1998,  the  Company's
common stock listing was removed from the Vancouver Stock Exchange.

      Holders of Common Stock are entitled to receive dividends if and
when declared by the Board of Directors out of funds legally available
therefor.   It  has  been the Company's policy to retain  earnings  to
finance the growth of its business.  Accordingly, the Company has  not
issued  a cash dividend and has no plans to do so in the near  future.
As  of  March  31, 2000, there were approximately 500 stockholders  of
record of the Company's Common Stock.

      Effective  May 5,1999 the Company's NASDAQ stock symbol  changed
from "NICKF" to "NICK".

     The following table reflects the high and low sale prices for the
Company's common stock on NASDAQ for fiscal 2000 and fiscal 1999.

<TABLE>
<S>                                       <C>          <C>
Price Range of Common Stock:

Year ended March 31, 2000                   High        Low
     First Quarter ...........              $4.55       $3.50
     Second Quarter...........               5.50        3.63
     Third Quarter............               5.38        4.03
     Fourth Quarter............              5.75        4.13

Year ended March 31, 1999                   High        Low
     First Quarter ...........              $3.75       $2.88
     Second Quarter...........               3.25        2.13
     Third Quarter............               3.63        2.25
     Fourth Quarter............              4.38        3.00

</TABLE>
<PAGE> 14

Item  6.  Management's Discussion and Analysis of Financial  Condition
and Results of Operations


Overview

     Consolidated net income increased in the fiscal year ended  March
31,  2000 to $2,577,568 or $1.01 per diluted share from $1,602,356  or
$0.65  per  diluted  share in the fiscal year ended  March  31,  1999.
Earnings for the year were favorably impacted by significant growth in
the outstanding loan portfolio, improved portfolio performance and  an
improvement in the cost of funds.

The following table sets forth certain financial data:


<TABLE>
<CAPTION>
                                           Years Ended March 31
                                           2000            1999
                                        --------------------------
<S>                                    <C>            <C>
Average Net Finance Receivables(1)      $55,015,469    $43,578,531

Average Indebtedness(2)                 34,530,273     27,923,366

Interest Income                          13,557,371      9,922,689

Interest Expense                          2,771,100      2,358,838

Net Interest Income                      10,786,271      7,563,851
                                         -------------------------

Gross Portfolio Yield(3)                     24.64%         22.77%

Average Cost of Borrowed Funds(2)             8.03%          8.45%

Net Interest Spread(4)                       16.61%         14.32%
                                         -------------------------

Net Portfolio Yield(3)                       19.61%         17.36%
                                         -------------------------

Write-off  to Liquidation                     6.71%          7.93%

Net Charge-Off Percentage                     5.88%          6.84%

<FOOTNOTE>

(1)Average  net  finance  receivables represent  the  average  of  net
  finance  receivables  throughout the year.  Net finance  receivables
  represents  gross  finance  receivables less  any  unearned  finance
  charges related to those receivables.

(2)Average  Indebtedness represents the average outstanding borrowings
  under  its  line  of  credit, subordinated debt and  notes  payable.
  Average  cost  of  borrowed  funds represents  interest  expense  as
  percentage of average indebtedness.

(3)Gross portfolio yield represents interest income as a percentage of
  average  finance  receivables.  Net portfolio yield  represents  net
  interest income as a percentage of average finance receivables.

(4)Net  interest  spread represents the gross portfolio yield less the
  average cost of borrowed funds.

</TABLE>
<PAGE> 15


Fiscal 2000 compared to Fiscal 1999


Interest Income and Loan Portfolio

     Interest  income  on  finance receivables, predominantly  finance
charge income, increased 37% to $13.6 million in fiscal 2000 from $9.9
million  in  fiscal 1999.  The net finance receivable balance  totaled
$52.0  million  at March 31, 2000, an increase of 30% from  the  $39.9
million  at  March  31,  1999.  The gross finance  receivable  balance
increased 31% to $82.8 million at March 31, 2000 from $63.4 million at
March 31, 1999. The primary reason interest revenue increased was  the
increase  in  the outstanding loan portfolio. The primary  reason  the
gross  portfolio  yield  increased  was  the  result  of  lower   than
anticipated write-off's on the existing portfolio. The primary  reason
net  finance receivables increased was the opening of three additional
offices  and the increased receivable base of several existing  branch
offices.


Computer Software Business

       In fiscal 2000, the revenues of NDS were $517,445 compared with
fiscal 1999 revenues of $495,849, an increase of 4%. This increase was
primarily  due  to  an increase in the installations  of  upgrades  to
existing  customers, driven by the year 2000 issue.  Operating  income
for  fiscal  2000  was  $13,205 compared with an operating  income  of
$24,245  for fiscal 1999. The Company expects both operating  revenues
and income of NDS to remain stable, although no assurance can be given
in this regard.


Operating Expenses

     Operating  expenses  excluding provision for  credit  losses  and
interest  expense increased to $5.8 million in fiscal 2000  from  $4.5
million   in   fiscal  1999.  This  increase  of  29%  was   primarily
attributable  to  the  opening of three additional  branch  locations,
increasing  the  number  of  employees  in  several  existing   branch
locations  and also increasing the number of corporate personnel.  The
Company has increased its work force from 71 employees at the  end  of
fiscal 1999 to 84 employees at the end of fiscal 2000.


Interest Expense

     Interest  expense  increased to $2.8 million in  fiscal  2000  as
compared to $2.4 million in fiscal 1999. This increase was due  to  an
increase in average outstanding borrowings from $27.9 million to $34.5
million.  The effect of this increase was offset in part by a decrease
in  the  Company's effective average cost of borrowing from  8.45%  in
fiscal 1999 to 8.03% in fiscal 2000.


Analysis of Credit Losses

    Because of the nature of the borrowers under the Contracts and its
direct  consumer loan program, the Company considers the establishment
of  adequate reserves for credit losses to be imperative.  The Company
segregates  its  Contracts  into pools for  purposes  of  establishing
reserves  for losses.  Each such pool consists of the loans  purchased
by  a  Company branch office during a three month period.  The average
pool  consists  of  75 Contracts with an aggregate  initial  principal
amount  of  approximately $593,027. As of March 31, 2000, the  Company
had 238 active pools.

<PAGE> 16

     The  Company pools Contracts according to branch location because
the  branches  purchase  contracts in  different  markets  located  in
Florida,  Georgia  and North Carolina. All Contracts  purchased  by  a
branch during a fiscal quarter comprise a pool. This method of pooling
by  branch  and  quarter allows the Company to evaluate the  different
markets  where the branches operate. The pools also allow the  Company
to evaluate the different levels of customer income, stability, credit
history, and the types of vehicles purchased in each market.

     A  pool  retains an amount equal to 100% of the discount  into  a
reserve  for  credit  losses. In situations  where,  at  the  date  of
purchase, the discount is determined to be insufficient to absorb  all
potential  losses  associated  with the  pool,  a  portion  of  future
unearned  income associated with that specific pool will be  added  to
the  reserves for credit losses until total reserves have reached  the
appropriate  level.  Subsequent to the purchase, if  the  reserve  for
credit  losses is determined to be inadequate for a pool which is  not
fully  liquidated,  then  a charge to income is  used  to  reestablish
adequate reserves. If a pool is fully liquidated and has any remaining
reserves, the excess reserves are recognized as income.

     In  analyzing  a pool, the Company considers the  performance  of
prior  pools originated by the branch office, the performance of prior
Contracts  purchased from the dealers whose Contracts are included  in
the  current  pool,  the  credit rating of  the  borrowers  under  the
Contracts  in  the  pool, and current market and economic  conditions.
Each  pool  is analyzed monthly to determine if the loss reserves  are
adequate  and  adjustments  are made if  they  are  determined  to  be
necessary.  As of March 31, 2000, the Company had established reserves
for  losses on Contracts of $10,968,714 or 13.25% of gross outstanding
receivables under the Contracts.

<PAGE> 17

   The  following  tables  present certain information  regarding  the
delinquency rates experienced by the Company with respect to Contracts
and under its direct consumer loan program:

<TABLE>
<CAPTION>
                                   Year Ended         Year Ended
                                 March 31, 2000      March 31, 1999
                                 --------------      --------------
<S>                         <C>  <C>    <C>      <C> <C>      <C>
Contracts
Gross Balance Outstanding         $79,218,572         $61,486,782


                              Dollar               Dollar
Delinquencies                 Amount    Percent    Amount     Percent
                            ----------  -------   ----------  -------
30 to 59 days               $1,710,659   2.16%    $1,404,387   2.28%
60 to 89 days                  171,880   0.22%       307,239   0.50%
90 + days                       88,949   0.11%       155,271   0.25%
                            ----------            ----------
Total Delinquencies         $1,971,488            $1,866,897

Total Delinquencies as a
percent of outstanding balance           2.49%                 3.03%



Direct Loans
Gross Balance Outstanding          $3,574,364          $1,952,418

Delinquencies

30 to 59 days                   15,421   0.43%         9,791   0.50%
60  to 89 days                   6,301   0.18%        12,186   0.62%
90 +  days                       4,746   0.13%         6,009   0.31%
                                ------                ------
Total  Delinquencies           $26,468               $27,986

Total Delinquencies  as
apercent of outstanding Balance          0.74%                 1.43%


</TABLE>

The  provision  for  credit losses was $1,069,719 in  fiscal  2000  as
compared to $940,922 in fiscal 1999. This was primarily the result  of
a  30%  increase  in  the net portfolio over last  year.  The  Company
decreased  its  total reserve percentage from 13.48% of gross  finance
receivables  for fiscal year ended March 31, 1999 to  13.25%  for  the
fiscal year ended March 31, 2000. Management believes that the reserve
adjustments  made during fiscal 2000 are consistent with  its  reserve
methodology.


<PAGE> 18

Income Taxes

   The  provision  for income taxes in fiscal 2000  increased  85%  to
$1,853,229 from $1,003,242 in fiscal 1999 as a result of higher pretax
income  and  the  reversal  of  a prior year  income  tax  benefit  in
connection  with  a shareholder warrant. The Company's  effective  tax
rate increased from 38.50% in fiscal 1999 to 41.83% in fiscal 2000.


Net Income

   As  a  result  of  the  above factors, net  income  increased  from
$1,602,356 in fiscal 1999 to $2,577,568 in fiscal 2000.


Liquidity and Capital Resources

The  Company's  cash flows for fiscal 2000 and 1999 are summarized  as
follows:

<TABLE>
<CAPTION>

                                      Fiscal          Fiscal
                                       2000            1999
                                   -------------   -------------
<S>                                 <C>             <C>
Cash provided by (used in):
  Operations                         $4,946,212      $2,217,609
  Investing activities -
   (primarily purchase of
    installment contracts)          (13,366,705)     (8,523,794)

  Financing activities                8,170,258       6,511,643
                                     ----------       ---------
Net increase (decrease) in cash       $(250,235)       $205,458
                                     ==========       =========
</TABLE>

      The  Company's primary use of working capital during fiscal year
2000 was the funding of the purchase of Contracts.  The Contracts were
financed substantially through borrowings on the Company's $45 million
line  of credit.  The line of credit, which expires in November  2002,
is  secured primarily by Contracts, and available borrowings are based
on  a  percentage of qualifying Contracts. As of March  31,  2000  the
Company  had  approximately $6.6 million available under the  line  of
credit. Since inception, the Company has also funded a portion of  its
working capital needs from cash flows from operating activities.

      The  self-liquidating nature of installment Contracts and  other
loans enables the Company to assume a higher debt-to-equity ratio than
in most businesses. The amount of debt the Company incurs from time to
time  under  these financing mechanisms depends on the Company's  need
for  cash  and it's ability to borrow under the terms of its  line  of
credit. The Company believes that borrowings available under the  line
of  credit as well as cash flow from operations and, if necessary, the
issuance  of additional subordinated debt and or additional securities
in  the  capital  markets, will be sufficient to meet its  short  term
funding needs.

<PAGE> 19


Impact of Inflation

      The  Company  is  affected by inflation primarily  by  increased
operating  costs, and expenses including increases in interest  rates.
Inflationary  pressures  on operating costs  and  expenses  have  been
offset by the Company's continued emphasis on stringent operating  and
cost  controls and to a lesser extent by modest increases  in  support
rates from its software subsidiary, NDS. Management believes that  the
Company's  financial  position has enabled it to  negotiate  favorable
interest  rates. No assurances can be given that the Company  will  be
able to continue to do so in the future.

      The  Company  believes  that a downturn  in  the  economy  would
increase  the  number  of  purchasers  of  automobiles  financed  with
Contracts.  During a modest downturn in economic activity more  people
will experience a reduction in income because of downsizing, fewer and
smaller  raises, and the necessity of accepting lower paying jobs.  In
addition,  it  may  be difficult for individuals who have  financially
over-extended themselves to meet their debt obligations and  they  may
find  it  necessary  to  purchase used rather  than  new  automobiles.
Although the number of potential customers can be expected to increase
during  periods of slow economic activity, the number of  defaults  in
payment  obligations can also be expected to increase with a resulting
increase in repossessions of vehicles securing Contracts.  The Company
is  not  able  to  predict whether or not the net  effect  of  such  a
downturn would be favorable or unfavorable to the operating results of
the  Company, although the Company believes that a severe downturn  in
economic  activities  could  have a material  adverse  effect  on  its
business, financial condition and results of operations.


Future Expansion

      The  Company  will  seek to continue its expansion  through  the
purchase  of  additional  Contracts and the expansion  of  its  direct
consumer loan program.  In order to increase the size of the Company's
portfolio of Contracts, it will be necessary for the Company  to  open
additional branch offices and increase the size of its revolving  line
of  credit  arrangement,  either with its current  lender  or  another
lender.   The  Company,  from time to time, has  and  will  meet  with
private  investors  and  financial  institutions  that  specialize  in
investing in subordinated debt. The Company believes that the addition
of  more  debt that is subordinate to the line of credit will make  it
possible  for the Company to continue to meet or exceed its  covenants
under  the  loan  agreement, increase the amount of funds  drawn  down
under  its line of credit, and draw funds under the line at  a  faster
rate.   The Company also intends to continue its policy of not  paying
dividends and using earnings from operations to purchase Contracts  or
make direct consumer loans. The Company believes that opportunity  for
growth  continues to exist in Florida, Georgia and North Carolina  and
intends  to  continue its expansion activities in  those  states.  The
Company is also exploring the possibility of expanding into additional
states; but it does not have any current plans to do so. No assurances
can  be given that the Company will be able to continue to expand  its
operations.


Item 7. Financial Statements

The  following financial statements are filed as part of  this  report
(see pages 20-40)

  Report of Independent Auditors..............................20

  Audited Consolidated Financial Statements

  Consolidated Balance Sheets.................................21
  Consolidated Statements of Income and Retained Earnings.....22
  Consolidated Statements of Cash Flows.......................23
  Notes to the Consolidated Financial Statements..............24

<PAGE> 20

                 Report of Independent Auditors

To the Board of Directors of
Nicholas Financial, Inc.

We  have audited the accompanying consolidated balance sheets  of
Nicholas  Financial, Inc. and subsidiaries as of March  31,  2000
and  1999, and the related consolidated statements of income  and
retained earnings and cash flows for the years then ended.  These
financial  statements  are the responsibility  of  the  Company's
management. Our responsibility is to express an opinion on  these
financial statements based on our audits.

We  conducted  our  audits in accordance with auditing  standards
generally accepted in the United States. Those standards  require
that we plan and perform the audit to obtain reasonable assurance
about  whether  the  financial statements are  free  of  material
misstatement.  An  audit includes examining,  on  a  test  basis,
evidence  supporting the amounts and disclosures in the financial
statements.  An  audit  also includes  assessing  the  accounting
principles used and significant estimates made by management,  as
well  as evaluating the overall financial statement presentation.
We  believe  that our audits provide a reasonable basis  for  our
opinion.

In  our  opinion,  the  financial statements  referred  to  above
present  fairly,  in  all  material  respects,  the  consolidated
financial  position of Nicholas Financial, Inc. and  subsidiaries
at  March 31, 2000 and 1999, and the consolidated results of  its
operations  and  its  cash  flows for the  years  then  ended  in
conformity with accounting principles generally accepted  in  the
United States.



                                                Ernst & Young,LLP

May 24, 2000
Tampa, Florida

<PAGE> 21


            Nicholas Financial, Inc. and Subsidiaries
                   Consolidated Balance Sheets


<TABLE>
<CAPTION>
                                                     March 31
                                                 2000        1999
                                            -------------------------
<S>                                         <C>          <C>
Assets
Cash                                        $   259,183  $   509,418
Finance receivables, net                     52,015,107   39,923,471
Accounts receivable                              20,922       22,932
Prepaid expenses and other assets               392,684      308,844
Property and equipment, net                     331,594      217,293
Deferred income taxes                         1,115,888    1,275,056
                                            -------------------------
Total assets                                $54,135,378  $42,257,014
                                            =========================

Liabilities
Line of credit                              $38,414,549  $29,964,549
Notes payable-related party                   1,318,008    1,606,765
Accounts payable                              2,695,622    1,735,356
Income taxes payable                             44,965            -
Deferred revenues                               518,718      387,944
Other liabilities                                16,232       21,699
                                            -------------------------
                                             43,008,094   33,716,313

Shareholders' Equity
Preferred stock, no par: 5,000,000 shares
authorized; none issued and outstanding               -            -
Common stock, no par: 50,000,000 shares
authorized; 2,352,008 and 2,349,108 shares
issued and outstanding, respectively          3,711,602    3,702,587
Retained earnings                             7,415,682    4,838,114
                                            -------------------------
                                             11,127,284    8,540,701
                                            -------------------------
Total liabilities and shareholders' equity  $54,135,378  $42,257,014
                                            =========================

See accompanying notes.

</TABLE>
<PAGE> 22

            Nicholas Financial, Inc. and Subsidiaries
     Consolidated Statements of Income and Retained Earnings


<TABLE>
<CAPTION>
                                                Year ended March 31
                                                 2000         1999
                                              ------------------------
<S>                                          <C>          <C>
Revenue:
 Interest income on finance receivables       $13,557,371  $ 9,922,689
 Sales                                            517,445      495,849
                                              ------------------------
                                               14,074,816   10,418,538
Expenses:
 Cost of sales                                     90,471      102,368
 Marketing                                        396,307      369,968
 Administrative                                 5,225,373    3,950,839
 Provision for credit losses                    1,069,719      940,922
 Depreciation                                      91,049       90,005
 Interest expense                               2,771,100    2,358,838
                                              ------------------------
                                                9,644,019    7,812,940
                                              ------------------------
Operating income before income taxes            4,430,797    2,605,598

Income tax expense (benefit):
 Current                                        1,694,061    1,327,520
 Deferred                                         159,168     (324,278)
                                              ------------------------
                                                1,853,229    1,003,242
                                              ------------------------
Net income                                      2,577,568    1,602,356
                                              ========================

Retained earnings, beginning of year            4,838,114    3,235,758
                                              ------------------------
Retained earnings, end of year                 $7,415,682   $4,838,114
                                              ========================
Earnings per share:
     Basic                                          $1.10         $.68
                                              ========================
     Diluted                                        $1.01         $.65
                                              ========================

Weighted average  shares - basic                2,352,286    2,357,984
                                              ========================
Weighted average  shares - diluted              2,656,315    2,622,782
                                              ========================
See accompanying notes.

</TABLE>
<PAGE> 23

            Nicholas Financial, Inc. and Subsidiaries
              Consolidated Statements of Cash Flows

<TABLE>
<CAPTION>

                                              Year ended March 31
                                                 2000      1999
                                            --------------------------
<S>                                         <C>          <C>
Cash flows from operating activities

Net income                                   $ 2,577,568  $ 1,602,356
Adjustments to reconcile net income to net
cash provided
 by operating activities:
  Depreciation                                    91,049       90,005
  Provision for credit losses                  1,069,719      940,922
  Deferred income taxes                          159,168     (324,278)
  Changes in operating assets and
   liabilities:
   Accounts receivable                             2,010          473
   Prepaid expenses and other assets             (83,840)     (61,999)
   Deferred revenues                             130,774      146,815
   Accounts payable                              960,266       (7,102)
   Other liabilities                              (5,467)         299
   Income taxes payable                           44,965     (169,882)
                                            --------------------------
Net cash provided by operating activities      4,946,212    2,217,609

Investing activities

Increase in finance receivables, net of
 principal collected                         (13,161,355)  (8,439,982)
Purchase of property and equipment, net of
 disposals                                      (205,350)     (83,812)
                                            --------------------------
Net cash used in investing activities        (13,366,705)  (8,523,794)

Financing activities

(Repayment) proceeds of notes payable
 -related party                                 (288,757)      15,170
Net proceeds from line of credit               8,450,000    6,533,955
Sale (repurchase) of common stock                  9,015      (37,482)
                                            --------------------------
Net cash provided by financing activities      8,170,258    6,511,643
                                            --------------------------
Net (decrease) increase in cash                 (250,235)     205,458
Cash, beginning of year                          509,418      303,960
                                            --------------------------
Cash, end of year                               $259,183     $509,418
                                            ==========================

See accompanying notes.

</TABLE>
<PAGE> 24

            Nicholas Financial, Inc. and Subsidiaries
         Notes to the Consolidated Financial Statements
                         March 31, 2000


1. Organization

Nicholas  Financial,  Inc. (NFI, Canada) is  a  Canadian  holding
company incorporated under the laws of British Columbia with  two
wholly-owned United States subsidiaries, Nicholas Data  Services,
Inc.  (NDS)  and Nicholas Financial, Inc. (NFI). NDS  is  engaged
principally in the development, marketing and support of computer
application  software.  NFI is engaged principally  in  providing
installment  sales  financing. Both NDSI and  NFI  are  based  in
Florida, U.S.A. The accompanying financial statements are  stated
in  U.S  dollars and are presented in accordance with  accounting
principles generally accepted in the United States.

2. Accounting Policies

Consolidation

The  consolidated financial statements include  the  accounts  of
NFI,  Canada  and  its wholly-owned subsidiaries,  NDS  and  NFI,
collectively   referred  to  as  the  Company.  All  intercompany
transactions and balances have been eliminated.

Property and Equipment

Property  and  equipment are recorded at cost.  Expenditures  for
repairs  and  maintenance  are charged to  expense  as  incurred.
Depreciation  of  property and equipment is  computed  using  the
straight-line  method  over the estimated  useful  lives  of  the
assets as follows:

          Automotive                            3 years
          Equipment                             5 years
          Furniture and fixtures                7 years
          Leasehold improvements             Lease term

<PAGE> 25

            Nicholas Financial, Inc. and Subsidiaries
   Notes to the Consolidated Financial Statements (continued)


2. Accounting Policies (continued)

Allowance for Loan Losses

The  allowance  for loan losses is increased by  charges  against
earnings  and  decreased by charge-offs (net of  recoveries).  In
addition to the allowance for loan losses, a nonrefundable dealer
reserve  has been established using unearned interest and  dealer
discounts to absorb potential credit losses. To the extent actual
credit  losses  exceed these reserves, a bad  debt  provision  is
recorded;  and  to  the extent credit losses are  less  than  the
reserve, the reserve is accreted into income as an adjustment  to
the  interest  yield  over  the term of  the  underlying  finance
receivables.

Management's periodic evaluation of the adequacy of the allowance
is  based  on  the  Company's  past loan  experience,  known  and
inherent  risks  in  the portfolio, adverse situations  that  may
affect  the borrower's ability to repay, the estimated  value  of
any underlying collateral, and current economic conditions.

Income Taxes

Income  taxes  are  accounted for under the asset  and  liability
method.  Deferred tax assets and liabilities are  recognized  for
the  future tax consequences attributable to differences  between
the  financial statement carrying amounts of existing assets  and
liabilities and their respective tax bases and operating loss and
tax credit carryforwards. Deferred tax assets and liabilities are
measured  using  enacted tax rates expected to apply  to  taxable
income  in  the  years in which those temporary  differences  are
expected  to be recovered or settled. The effect on deferred  tax
assets  and liabilities of a change in tax rate is recognized  in
income in the period that includes the enactment date.

<PAGE> 26

            Nicholas Financial, Inc. and Subsidiaries
   Notes to the Consolidated Financial Statements (continued)



2. Accounting Policies (continued)

Revenue Recognition

Revenues  resulting from the sale of hardware  and  software  are
recognized upon delivery of the products. Revenues from  software
support maintenance and lease agreements are recognized pro  rata
over  the  life  of the agreements. The unamortized  amounts  are
included in the caption "deferred revenues."

Interest  income on finance receivables is recognized  using  the
interest  (actuarial)  method.  Accrual  of  interest  income  on
finance  receivables  is suspended when a loan  is  contractually
delinquent  for 60 days or more or the collateral is repossessed,
whichever is earlier.

Earnings Per Share

Basic  earnings per share excludes any dilutive effects of common
stock  equivalents  such  as options, warrants,  and  convertible
securities.  Diluted earnings per share includes the  effects  of
dilutive options, warrants, and convertible securities. Basic and
diluted earnings per share have been computed as follows:

<PAGE> 27
            Nicholas Financial, Inc. and Subsidiaries
   Notes to the Consolidated Financial Statements (continued)



2. Accounting Policies (continued)

<TABLE>
<CAPTION>
                                              Year ended March 31
                                                2000        1999
                                          --------------------------
<S>                                       <C>            <C>
Numerator:

 Numerator for basic earnings per share
  -Net income available to
  common stockholders                      $2,577,568     $1,602,356

 Effect of dilutive securities:
     Convertible debt                          94,023         99,636
                                          --------------------------
 Numerator for dilutive earnings
  per share - income available to
  common stockholders after
  assumed conversions                      $2,671,591     $1,701,992
                                          ==========================
Denominator:
 Denominator for basic earnings per
  share - weighted average shares           2,352,286      2,357,984
 Effect of dilutive securities: (A)
  Employee stock options                       54,231              -
  Convertible debt                            249,798        264,798
                                          --------------------------
 Denominator for diluted earnings per
  share - adjusted weighted-average
  shares and assumed conversions            2,656,315      2,622,782
                                          ==========================
Earnings per share - basic                      $1.10          $0.68
                                          ==========================
Earnings per share - diluted                    $1.01          $0.65
                                          ==========================

<FOOTNOTE>
Footnote A:
    Options                                         -        215,200
    Warrants                                  333,333        333,333

 The  options  and  warrants above were
outstanding  but  not included  in  the
computation  of  diluted  earnings  per
share  because  the  effect  would   be
antidilutive.

</TABLE>
<PAGE> 28

            Nicholas Financial, Inc. and Subsidiaries
   Notes to the Consolidated Financial Statements (continued)



2. Accounting Policies (continued)

Stock Option Accounting

The  Company  has  elected to follow Accounting Principles  Board
Opinion  No. 25, "Accounting for Stock Issued to Employees"  (APB
25)  and  related  interpretations in accounting  for  its  stock
option grants and to present the disclosure requirements relating
to   stock-based   compensation  plans  required   by   Financial
Accounting  Standards  Board Statement No. 123,  "Accounting  for
Stock-Based Compensation" (FAS 123).

Financial Instruments

The   Company's   financial  instruments   consist   of   finance
receivables,   accounts  receivable,  line   of   credit,   notes
payable-related  party and accounts payable. For  each  of  these
financial instruments, the carrying value approximates  its  fair
value.

The   Company's  financial  instruments  that  are   exposed   to
concentrations of credit risk are primarily finance  receivables,
which  are  concentrated in the States of  Florida,  Georgia  and
North  Carolina.  The Company provides credit during  the  normal
course of business and performs ongoing credit evaluations of  it
customers. The Company maintains allowances for potential  credit
losses  which,  when  realized, have been  within  the  range  of
management's  expectations.  The  Company  perfects   a   primary
security  interest  in  all  vehicles  financed  as  a  form   of
collateral.

Use of Estimates

The  preparation  of the financial statements in conformity  with
generally  accepted accounting principles requires management  to
make  estimates and assumptions that affect the amounts  reported
in  the  financial  statements  and  accompanying  notes.  Actual
results could differ from those estimates.

Statement of Cash Flows

Cash paid for income taxes for the years ended March 31, 2000 and
1999  was  $1,596,183 and $1,550,316 respectively. Cash paid  for
interest  for  the  years  ended March  31,  2000  and  1999  was
$2,631,370 and $2,322,178, respectively.


<PAGE> 29

            Nicholas Financial, Inc. and Subsidiaries
   Notes to the Consolidated Financial Statements (continued)



Recent Accounting Pronouncements

In  June  1998, the Financial Accounting Standards  Board  issued
Statement  No.  133 , Accounting for Derivative  Instruments  and
Hedging  Activities (FAS 133). The Company expects to  adopt  the
new statement effective April 1, 2001. The Statement will require
the Company to recognize all derivatives on the balance sheet  at
fair value. The Company does not anticipate that the adoption  of
the  Statement will have a significant effect on its  results  of
operations or financial position.

3. Finance Receivables

Finance   receivables  consist  of  consumer  automobile  finance
installment contracts and are detailed as follows:

<TABLE>
<CAPTION>
                                         2000          1999
                                     --------------------------
    <S>                              <C>           <C>
     Finance receivables,
      gross contract                  $82,792,936   $63,439,200
     Less:
      Unearned interest               (19,809,115)  (14,967,179)
                                      --------------------------
                                       62,983,821    48,472,021

      Nonrefundable dealer reserve     (8,444,103)   (6,643,593)
      Allowance for credit losses      (2,524,611)   (1,904,957)
                                     --------------------------
      Finance receivables, net        $52,015,107   $39,923,471
                                     ==========================
</TABLE>

The  terms of the receivables range from 12 to 60 months and bear
a  weighted average effective interest rate of 24% for both  2000
and 1999, respectively.

<PAGE> 30
            Nicholas Financial, Inc. and Subsidiaries
   Notes to the Consolidated Financial Statements (continued)



3. Finance Receivables (continued)

The following table sets forth a reconciliation of the changes in
nonrefundable dealer reserves for the years ended March 31.

<TABLE>
<CAPTION>
                                         2000            1999
                                      --------------------------
<S>                                  <C>             <C>
Balance at beginning of year          $6,643,593      $4,525,034
Discounts acquired on new volume       6,785,407       5,330,351
Recoveries                               520,264         269,151
Accreted to income                    (2,046,012)       (724,520)
Losses absorbed                       (3,459,149)     (2,756,423)
                                      --------------------------
Balance at end of year                $8,444,103      $6,643,593
                                      ==========================
Reserve as a percent of gross
finance receivables                       10.20%          10.47%
                                      ==========================

The following table sets forth a reconciliation of the changes in
the allowance for doubtful accounts for the years ended March 31.


                                         2000           1999
                                     ----------------------------
Balance at beginning of year          $1,904,957     $1,612,106
Current year provision                 1,069,719        940,922
Accreted to income                      (80,607)       (36,138)
Losses absorbed                        (369,458)      (611,933)
                                      --------------------------
Balance at end of year                $2,524,611     $1,904,957
                                      ==========================
Reserve as a percent of gross
finance receivables                        3.05%          3.00%
                                      ==========================

</TABLE>
<PAGE> 31

            Nicholas Financial, Inc. and Subsidiaries
   Notes to the Consolidated Financial Statements (continued)



4. Property and Equipment

<TABLE>
<CAPTION>

                                    Accumulated   Net Book
                            Cost    Depreciation   Value
                          --------------------------------
    <S>                   <C>        <C>         <C>
     2000
     Automotive            $88,670    $11,230     $77,440
     Equipment             326,155    201,813     124,342
     Furniture and
     fixtures              138,304     85,715      52,589
     Leasehold
     improvements          166,225     89,002      77,223
                          --------------------------------
                           $719,354   $387,760   $331,594
                          ================================
     1999
     Automotive             $45,664    $13,466    $32,198
     Equipment              276,476    160,463    116,013
     Furniture and
     fixtures               117,596     72,660     44,936
     Leasehold
     improvements            92,643     68,497     24,146
                          --------------------------------
                           $532,379   $315,086   $217,293
                          ================================
</TABLE>
<PAGE> 32

            Nicholas Financial, Inc. and Subsidiaries
   Notes to the Consolidated Financial Statements (continued)


5. Line of Credit

The  Company has a $45,000,000 line of credit facility (the Line)
with BA Business Credit, Inc. of which $38,414,540 is outstanding
at  March  31,  2000  and  which expires on  November  30,  2002.
Borrowings  under the Line bear interest at the Bank  of  America
prime   rate  or  several  Libor  pricing  options.  Pledged   as
collateral  for  this credit facility are all of  the  assets  of
Nicholas Financial Inc. and its subsidiaries.

On  May  11, 1999 the Company entered into an interest rate  swap
with  a  notional amount of $10 million at a fixed rate of 5.81%,
maturing  on  May  24, 2002. On May 21, 1999 the Company  entered
into  two interest rate swaps with notional amounts of $5 million
each, at fixed rates of 5.81% and 6.08%, maturing on May 24, 2001
and May 24, 2004, respectively.

On  August  18,  1999 the Company terminated a  $5  million  swap
maturing on May 24, 2004 in exchange for $52,000. In addition the
Company entered into an interest rate swap with a notional amount
of  $10  million at a fixed rate of 5.80%, provided that  30  day
libor  does not exceed 8%, maturing on May 24, 2003. In the event
30  day libor exceeds 8.00% , the fixed rate of 5.80% would  swap
back  to  the  variable rate for all periods where 30  day  libor
exceeds 8.00%.

The  Company  utilizes  the above noted interest  rate  swaps  to
manage  its interest rate exposure. The swaps effectively convert
a  portion  of the Company's floating rate debt to a fixed  rate,
more  closely matching the interest rate characteristics  of  the
Company's finance receivables.

<PAGE> 33

            Nicholas Financial, Inc. and Subsidiaries
   Notes to the Consolidated Financial Statements (continued)



6. Notes Payable-Related Party

Notes payable to shareholders, directors and individuals related
thereto at March 31:

<TABLE>
<CAPTION>

                                               2000      1999
                                             --------------------
    <S>                                     <C>         <C>
     Notes   payable,  unsecured,  with
     interest  at  varying  rates up to
     12%,   quarterly   and  semiannual
     interest  payments   due   through
     January  2002,  at  which time the
     entire   principal   balance   and
     unpaid    interest    is      due,
     subordinated  to  the  Line.   The
     notes   are   convertible  at  the
     option of  the holder, into common
     shares  at  prices  from  $4.50 to
     $6.00 per share.                       $850,000     $1,150,000

     Notes payable,  unsecured interest
     at  12%,  quarterly  interest  due
     through April  2000, at which time
     the  entire   balance  and  unpaid
     interest  is due, subordinated  to
     the Line. The note  is convertible
     at the option of the  holder, into
     common shares at $8.25 per share.       200,000        200,000

     Note  payable, unsecured, interest
     at 12%, principal and interest due
     through August 2001.                    219,270        249,211

     Note  payable, unsecured, interest
     at 12%, principal and interest due
     upon 30 day demand.                      48,738          7,554
                                          --------------------------
                                          $1,318,008     $1,606,765
                                          ==========================
</TABLE>

Maturities of notes payable are summarized as follows:

<TABLE>
<CAPTION>
<S>                                            <C>
 Year ending March 31
 ---------------------
     2001                                         $248,738
     2002                                        1,069,270
                                                ----------
                                                $1,318,008
                                                ==========
</TABLE>

The company incurred interest expense on the above notes of
$197,499 and $200,140 for the years ended March 31, 2000 and
1999, respectively.

<PAGE> 34

            Nicholas Financial, Inc. and Subsidiaries
   Notes to the Consolidated Financial Statements (continued)



7. Income Taxes

The provision for income taxes reflects an effective U.S tax
rate, which differs from the corporate tax rate (34%) for the
following reasons:

<TABLE>
<CAPTION>
                                               2000          1999
                                            -----------------------
 <S>                                        <C>           <C>
 Provision for income taxes at Federal
  statutory rate                             $1,506,471    $885,903
       Increase resulting from:
          State income taxes, net of
          Federal benefit                      $243,694     117,252
          Other                                 103,064          87
                                             ----------------------
                                             $1,853,229  $1,003,242
                                             ======================

The Company's deferred tax assets consist of the following as of
March 31:

                                                 2000       1999
                                             -----------------------
   Allowance for credit losses not
   deductible for tax purposes                $1,038,867  $1,056,988
   Deferred compensation related to stock
   options and warrants                                -     157,000
   Other items                                    77,021      61,068
                                             -----------------------
                                              $1,115,888  $1,275,056
                                             =======================

</TABLE>

NFI,  Canada  has  income  tax  loss  carryforward  balances   of
approximately   Cdn$277,000     (1999-Cdn$256,000)   which    are
available  to  reduce future taxable income and which  expire  as
follows:

For  the  years ended March 31, 2000 and 1999, the Company  would
have  recorded deferred tax assets of approximately  $86,000  and
$82,000, respectively, due primarily to these Canadian income tax
loss carryforwards. The assets, however, are offset entirely by a
valuation  allowance due to the relative uncertainty  surrounding
the realization of the assets.


<PAGE> 35

            Nicholas Financial, Inc. and Subsidiaries
   Notes to the Consolidated Financial Statements (continued)


8. Shareholders' Equity

Changes in the outstanding common stock are as follows:

<TABLE>
<CAPTION>
                                              Number    Common
                                                Of       Stock
                                              Shares
                                          ------------------------
<S>                                        <C>        <C>
Balance at March 31, 1998                    2,357,013  $3,740,069

Changes in 1999:
  Issued in connection with employee bonus
   plan                                          6,595      21,444
  Shares repurchased                           (14,500)    (58,926)
                                           ------------------------
Balance at March 31, 1999                    2,349,108  $3,702,587
                                           ========================

Changes in 2000:
  Issued in connection with employee bonus
   plan                                          4,000      19,000
  Issued for cash upon exercise of options       1,000       3,400
  Shares repurchased                            (2,100)    (13,385)
                                           ------------------------
Balance at March 31, 2000                    2,352,008  $3,711,602
                                           ========================
</TABLE>

The  Company  has a warrant outstanding entitling a  director  to
purchase  333,333 common shares at $5.28 U.S until  September  3,
2000.  At March 31, 2000, the warrant was fully exercisable.

The  Company has an employee stock incentive plan (the  SIP)  for
officers, directors and key employees under which 258,700  shares
of  common stock were reserved for issuance as of March 31, 2000.
Options  currently granted by the Company generally vest  over  a
five year period.

<PAGE> 36

            Nicholas Financial, Inc. and Subsidiaries
   Notes to the Consolidated Financial Statements (continued)


8. Shareholders' Equity (continued)

The   Company   has  elected  to  follow  APB  25,  and   related
Interpretations  in  accounting for its  employee  stock  options
because,   as  discussed  below,  the  alternative   fair   value
accounting  provided for under FAS 123, requires  use  of  option
valuation  models  that were not developed  for  use  in  valuing
employee  stock options. Under APB 25, if the exercise  price  of
the  Company's employee stock options equals the market price  of
the  underlying  stock  on  the date of  grant,  no  compensation
expense is recognized.

Pro forma information regarding net income and earnings per share
as  required by FAS 123 has been determined as if the Company has
accounted  for  its employee stock options and  warrants  granted
subsequent  to December 31, 1994 under the fair value  method  of
that Statement. The fair value for these options and warrants was
estimated  at  the  date  of grant using a  Black-Scholes  option
pricing model with the following weighted-average assumptions for
2000 and 1999;

<TABLE>
<CAPTION>
                                 2000      1999
                                -----------------
<S>                             <C>       <C>
Risk free rate of return         6.40%     5.38%
Volatility factor                0.479     0.531
Expected life                  5 years   5 years
Expected dividends                None      None

</TABLE>

The Black-Scholes option valuation model was developed for use in
estimating the fair value of traded options which have no vesting
restrictions  and  are fully transferable.  In  addition,  option
valuations   models  require  the  input  of  highly   subjective
assumptions   including  the  expected  stock  price  volatility.
Because  the  Company's employee stock options and warrants  have
characteristics  significantly different  from  those  of  traded
options and warrants, and because changes in the subjective input
assumptions  can  materially effect the fair value  estimate,  in
management's  opinion,  the existing models  do  not  necessarily
provide  a  reliable  single measure of the  fair  value  of  its
employee stock options and warrants.

<PAGE> 37

            Nicholas Financial, Inc. and Subsidiaries
   Notes to the Consolidated Financial Statements (continued)


8. Shareholders' Equity (continued)

For  purposes of pro forma disclosures, the estimated fair  value
of  the  options  and warrants is amortized to expense  over  the
option  and  warrant's vesting period. The  Company's  pro  forma
information follows:

<TABLE>
<CAPTION>
                                    2000       1999
                                 ----------------------
<S>                             <C>         <C>
Pro forma net income             $2,511,971  $1,553,839
Pro forma earnings per share:
  Basic                               $1.07        $.66
  Diluted                              $.98        $.63

</TABLE>

The following table reflects activity within the SIP for the
years noted:

<TABLE>
<CAPTION>
                                2000                   1999
                               -------                -------
                          Options  Weighted     Options    Weighted
                             &      Average        &        Average
                         Warrants Exercise Price Warrants Exercise Price
                        ------------------------------------------------
<S>                      <C>         <C>        <C>         <C>
Outstanding-beginning
  of year                 548,533    $4.42       468,120     $5.00
Granted                    70,000     4.75       258,200      3.40
Exercised                  (1,000)    3.40             -         -
Canceled/expired          (25,500)    3.42      (177,787)     3.92
                         --------               --------
Outstanding-end of
year                      592,033     4.62       548,533      4.42
                         ========               ========

Exercisable at end
of year                   371,073     5.09       333,333      5.07
                         ========               ========
Weighted-average fair
value of options granted
during the year                      $2.37                   $1.63

</TABLE>
<PAGE> 38

            Nicholas Financial, Inc. and Subsidiaries
   Notes to the Consolidated Financial Statements (continued)


8. Shareholders' Equity (continued)

<TABLE>
<CAPTION>
                                               Currently Exercisable
                                     Weighted  ----------------------
                          Weighted    Average              Weighted
                           Average   Remaining              Average
                          Exercise  Contractual            Exercise
                Shares      Price      Life      Shares      Price
               ------------------------------------------------------
<S>            <C>         <C>      <C>         <C>         <C>
$3.00 to 3.99   188,700     $3.40    3.20 years  37,740      $3.40
 4.00 to 4.99    70,000      4.75    4.61 years       -          -
 5.00 to 5.28   333,333      5.28    0.42 years 333,333       5.28
               ------------------------------------------------------
 Total          592,033     $4.62    1.80 years 371,073      $5.09
               ========                         =======

</TABLE>

9. Employee Benefit Plans

The  Company  has  a 401(k) profit sharing plan under  which  all
employees are eligible to participate. Employee contributions are
voluntary  and  subject to Internal Revenue Service  limitations.
The  Company  matches,  based  on  annually  determined  factors,
employee  contributions provided the employee  completes  certain
levels  of  service  annually. For 2000  and  1999,  the  Company
recorded  expenses of $19,957 and $17,296, respectively,  related
to  this  plan.  In  September of 1999  the  Board  of  Directors
approved a $100,000 Company profit sharing contribution for 2000.
All  employees who were eligible under the plan received a profit
sharing  contribution that was based on their total  compensation
in relation to the total compensation of all eligible employees.


<PAGE> 39
            Nicholas Financial, Inc. and Subsidiaries
   Notes to the Consolidated Financial Statements (continued)


10. Commitments

The  Company leases its corporate office and branch offices under
operating  lease  agreements  which provide  for  annual  minimum
rental payments as follows:

<TABLE>
<CAPTION>
 Year ending March 31
 ---------------------
    <S>                                          <C>
     2001                                         $309,477
     2002                                          242,437
     2003                                          153,646
     2004                                           31,575
     2005                                           10,459
                                                  --------
                                                  $747,594
                                                  ========
</TABLE>

Rent  expense  for the years ended March 31, 2000  and  1999  was
$270,087 and $217,192, respectively.

<PAGE> 40

            Nicholas Financial, Inc. and Subsidiaries
   Notes to the Consolidated Financial Statements (continued)



11 Segmented Information

The   segments  presented  have  been  identified  based  on  the
difference  in  the  products and services of the  Company's  two
wholly-owned  subsidiaries. Internal financial results  for  each
subsidiary are presented to and reviewed by the senior management
of  the  Company.  Substantially all of the Company's  operations
are in the United States. The industry segments are as follows:

<TABLE>
<CAPTION>
                                              Computer
                                            Application
                                  General   Software and
                                 Financing     Support    Corporate   Total
                               ---------------------------------------------------
  <S>                          <C>            <C>          <C>        <C>
   2000
   Interest Income and Sales    $13,557,371    $517,445           -    $14,074,816
   Operating income (loss)
     before income taxes          4,432,982      13,205     (15,390)     4,430,797
   Income tax expense             1,848,178       5,051           -      1,853,229
   Identifiable assets           53,977,043     156,621       1,714     54,135,378
   Capital expenditures             205,350           -           -        205,350
   Depreciation                      90,895         154           -         91,049

   1999
   Interest Income and Sales     $9,922,689    $495,849     $     -    $10,418,538
   Operating income (loss)
     before income taxes          2,580,853      24,745           -      2,605,598
   Income tax expense               993,714       9,528           -      1,003,242
   Identifiable assets           42,073,291     179,849       3,874     42,257,014
   Capital expenditures              83,812           -           -         83,812
   Depreciation                      86,430       3,575           -         90,005

</TABLE>

12. Subsequent Events


On  May  11, 2000 the Company entered into an interest rate  swap
with  a  notional amount of $10 million at a fixed rate of 6.87%,
provided that 30 day libor does not exceed 7.7%, maturing on  May
11, 2004. In the event 30 day libor exceeds 7.7% , the fixed rate
of  6.87%  would swap back to the variable rate for  all  periods
where 30 day libor exceeds 7.7%.

<PAGE> 41

Item  8.  Changes In and Disagreements with Accountants on  Accounting
and Financial Disclosure

     None.

                              PART III

Item 9. Directors, Executive Officers, Promoters and Control Persons

     The information set forth under the caption "Proposal 1: Election
of  Directors" in the Proxy Statement and Information Circular,  dated
on  or  about  July  3, 2000, for the 2000 Annual General  Meeting  of
Members of Nicholas Financial - Canada to be held August 9, 2000  (the
"Proxy  Statement"),  the  information set  forth  under  the  caption
"Executive Officers and Compensation" in the Proxy Statement, and  the
information  set  forth under the caption "Section 16  (a)  Beneficial
Ownership   Reporting   Compliance"  in  the   Proxy   Statement   are
incorporated by reference.

Additional information regarding the officers is set forth below.

      Peter  L.  Vosotas, age 58,  is the founder of the  Company  and
majority  stockholder of Nicholas Financial-Canada.  He has served  as
Chairman  of  the  Board,  Chief Executive Officer  and  President  of
Nicholas   Financial-Canada  and  each  of  its   subsidiaries   since
formation.  Prior to forming the Company, Mr. Vosotas held  a  variety
of Sales and Marketing positions with Ford Motor Company, GTE and AT&T
Paradyne  Corporation.  Mr Vosotas attended the  United  States  Naval
Academy  and  earned  a  Bachelor  of  Science  Degree  in  Electrical
Engineering from the University of New Hampshire.

      As of March 31, 2000 there was one executive officer who was not
also  a director of Nicholas Financial - Canada. Ralph T. Finkenbrink,
age 38,  has served as Vice-President-Finance of Nicholas Financial  -
Canada  since July 1997. He joined the Company in 1988 and  served  as
Controller of Nicholas Financial and NDS until 1992.  Prior to joining
the Company, he was a staff accountant for MBI, Inc. from January 1984
to  March 1985 and Inventory Control Manager for The Dress Barn,  Inc.
from  March  1985  to  December 1987.  Mr.  Finkenbrink  received  his
Bachelor  of  Science  Degree  in Accounting  from  Mount  St.  Mary's
University in Emmitsburg, Maryland.

<PAGE> 42

Item 10. Executive Compensation

      The  information set forth under the caption "Executive Officers
and  Compensation"  in the Proxy Statement is incorporated  herein  by
reference.


Item   11.  Security  Ownership  of  Certain  Beneficial  Owners   and
Management

      The  information set forth under the caption "Voting Shares  and
Ownership  of Management and Principal Holders" in the Proxy Statement
is incorporated herein by reference.


Item 12.  Certain Relationships and Related Transactions

       The   information   set  forth  under  the   caption   "Certain
Relationships  and  Related Transactions" in the  Proxy  Statement  is
incorporated herein by reference.

<PAGE> 43

                              SIGNATURES

     In accordance with Section 13 or 15(d) of the Securities Exchange
Act  of  1934, the Registrant has duly caused this Report to be signed
on its behalf by the undersigned thereunto duly authorized.

                                   NICHOLAS FINANCIAL, INC.
Dated: June 29, 2000
                                   By:  /s/ Peter L. Vosotas
                                   Peter L. Vosotas
                                   Chairman, Chief Executive Officer
                                   and President

      KNOW  ALL MEN BY THESE PRESENTS that each person whose signature
appears  below constitutes and appoints Peter L. Vosotas and Ralph  T.
Finkenbrink, and each of them, his or her true and lawful attorneys-in-
fact  and  agents, with full power of substitution and resubstitution,
for him or her and in his or her name, place and stead, in any and all
capacities, to sign any and all amendments to this report, and to file
the  same,  with  all  exhibits thereto, and any  other  documents  in
connection  therewith,  with the Securities and  Exchange  Commission,
granting  unto  said attorneys-in-fact and agents, and each  of  them,
full  power  and  authority to perform each and every  act  and  thing
requisite and necessary to be done in and about the premises, as fully
to  all intents and purposes as he or she might or could do in person,
hereby  ratifying  and  confirming all that said attorney-in-fact  and
agents  or  either of them, or their substitutes, may lawfully  do  or
cause to be done by virtue hereof.

      In  accordance with the Securities Exchange Act  of  1934,  this
Report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.

Signature                     Title                           Date

/s/ Peter L. Vosotas     Chairman of the Board, Chief   June 29, 2000
Peter L. Vosotas         Executive  Officer, President
                         and Director


/s/ Ralph T. Finkenbrink Vice President - Finance       June 29, 2000
Ralph T. Finkenbrink     (Principal Financial Officer)


/s/ Ellis P. Hyman            Director                  June 29, 2000
Ellis P. Hyman


/s/ Stephen Bragin            Director                  June 29, 2000
Stephen Bragin


/s/ Alton R. Neal             Director                  June 29, 2000
Alton R. Neal


/s/ Melvin S. Cutler          Director                  June 29, 2000
Melvin S. Cutler

<PAGE> 44

Item 13. Exhibits and Reports on Form 8-K

       (a)  Exhibits


3.1     Articles of Incorporation of Nicholas Financial, Inc. and By-
        Laws

        Incorporated by reference to the Company's Form 10-SB (File
         No. 0-26680) filed on March 13, 1996

4.1     Stock Certificate

        Incorporated by reference to Exhibit 4.1 to the Company's
         Form 10-SB (File No. 0-26680) filed on March 13, 1996

10.1.1  Loan  and Security Agreement dated March 31, 1993  between BA
         Business Credit, Inc. and Nicholas Financial, Inc.

        Incorporated by reference to Exhibit 10.1.1 to the Company's
         Form 10-SB (File No. 0-26680) filed on March 13, 1996

10.1.2  Amendment No. 1 to Loan Agreement dated January 14, 1994

        Incorporated by reference to Exhibit 10.1.2 to the Company's
         Form 10-SB (File No. 0-26680) filed on March 13, 1996

10.1.3  Temporary Line Increase Agreement dated Mach 28, 1994

        Incorporated by reference to Exhibit 10.1.3 to the Company's
         Form 10-SB (File No. 0-26680) filed on March 13, 1996

10.1.4  Amendment No. 2 to Loan Agreement dated June 3, 1994

        Incorporated by reference to Exhibit 10.1.4 to the Company's
         Form 10-SB (File No. 0-26680) filed on March 13, 1996

10.1.5  Amendment No. 3 to Loan Agreement dated July 5, 1994

        Incorporated by reference to Exhibit 10.1.5 to the Company's
         Form 10-SB (File No. 0-26680) filed on March 13, 1996

10.1.6  Amendment No. 4 to Loan Agreement dated March 31, 1995

        Incorporated by reference to Exhibit 10.1.6 to the Company's
         Form 10-SB (File No. 0-26680) filed on March 13, 1996

10.1.7  Amendment No. 5 to Loan Agreement  dated July 13, 1995

        Incorporated  by reference to Exhibit 10.1.7 to the Company's
         Form 10-KSB for the fiscal year ended March 31, 1996

<PAGE> 45

10.1.8  Amendment No. 6 to Loan Agreement  dated May 13, 1996

        Incorporated by reference to Exhibit 10.1.8 to the Company's
         Form 10-QSB for the three months ended June 30, 1996

10.1.9  Amendment No. 7 to Loan Agreement dated July 5, 1997

        Incorporated by reference to Exhibit 10.1.9 to the Company's
         Form 10-QSB for the three months ended September 30, 1997

10.2.0  Amendment No. 8 to Loan Agreement dated September 18, 1998

        Incorporated by reference to Exhibit 10.2.0 to the Company's
         Form 10-QSB for the three months ended September 30, 1998

10.2.1  Amendment No. 9 to Loan Agreement dated November 25, 1998

        Incorporated by reference to Exhibit 10.2.1 to the Company's
         Form 10-QSB for the three months ended December 31, 1998

10.2.2  Amendment No. 10 to Loan Agreement dated November 24, 1999

        Incorporated by reference to Exhibit 10.2.2 to the Company's
         Form 10-QSB for the three months ended December 31, 1999

10.3.1  Employee Stock Option Plan

        Incorporated  by  reference  to the Company's  1999  Annual
         proxy statement dated June 29, 1999

10.3.2  Non-Employee Stock Option Plan

        Incorporated  by  reference  to the Company's  1999  Annual
         proxy statement dated June 29, 1999

10.4.1  Employment Contract, dated November 22, 1999, between
         Nicholas Financial,  Inc. and Ralph Finkenbrink, Senior
         Vice President of Finance.

        Incorporated by reference to Exhibit 10.2.1 to the Company's
         Form 10-QSB for the three months ended December 31, 1999

21      Subsidiaries of Nicholas Financial, Inc.

        Incorporated by reference to the Company's Form 10-SB (File
         No. 0-26680) filed on March 13, 1996

23      Powers of Attorney (included on signature page hereto)

27      Financial Data Schedule (for SEC use only)

         (b)  Reports on Form 8-K
              None