UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                       Washington, DC  20549

                            FORM 10-QSB

X     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
  SECURITIES ACT OF 1934 FOR THE PERIOD ENDED DECEMBER 31, 2003



    TRANSITION REPORT PURSUANT TO 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.
      (Exact name of registrant as specified 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)

                          (727) 726-0763
       (Registrant's telephone number, Including area code)

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

Indicate  by check mark whether the registrant (1) has filed  all
reports  required  to be filed by Section 13  and  15(d)  of  the
Securities  Exchange Act of 1934 during the preceding  12  months
(or for such shorter periods 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 ____.


As of January 31, 2004 there were 5,080,288 shares of common
stock outstanding.


<PAGE> 2


                    Nicholas Financial, Inc.
                           Form 10-QSB
                              Index


Part I. Financial Information                                Page

Item 1. Financial Statements (Unaudited)

        Condensed Consolidated Balance Sheet as
         of December 31, 2003.................................3

        Condensed Consolidated Statements of Income
         for  the  three and nine months ended
         December 31, 2003 and 2002...........................4

        Condensed Consolidated Statements of Cash
         Flows for the nine months ended
         December 31, 2003 and 2002...........................5

        Notes to the Condensed Consolidated
         Financial Statements.................................6

Item 2. Management's Discussion and Analysis of Financial
         Condition and Results of Operations.................12

Item 3. Controls and Procedures..............................23


Part II. Other Information

Item 6. Exhibits and Reports on Form 8-K.....................24

        Signatures...........................................25

        Exhibit Index........................................28

<PAGE> 3


Part I. Item 1


                     Nicholas Financial, Inc.
               Condensed Consolidated Balance Sheet
                            (Unaudited)

<TABLE>
<CAPTION>

                                                December 31,
                                                    2003
                                              ----------------
<S>                                             <C>
Assets
Cash                                             $ 2,161,193
Finance receivables, net                          92,835,072
Accounts receivable                                   32,395
Assets held for resale                               676,635
Prepaid expenses and other assets                    361,104
Property and equipment, net                          561,127
Deferred income taxes                              3,049,950
                                                ------------
Total assets                                     $99,677,476
                                                ============
Liabilities
Line of credit                                   $66,010,290
Drafts payable                                       473,587
Notes payable - related party                        981,530
Accounts payable                                   3,453,175
Dividends payable                                    253,354
Derivatives                                        1,351,076
Deferred revenues                                  1,045,207
                                                ------------
Total liabilities                                 73,568,219

Shareholders' equity
Preferred stock, no par: 5,000,000 shares
 authorized; none issued and outstanding                   -
Common stock, no par: 50,000,000 shares
 authorized; 5,069,688 shares issued
 and outstanding                                   4,696,014
Accumulated other comprehensive loss                (841,045)
Retained earnings                                 22,254,288
                                                 -----------
Total shareholders' equity                        26,109,257
                                                 -----------
Total liabilities and shareholders' equity       $99,677,476
                                                ============
</TABLE>

See accompanying notes.


<PAGE> 4


                     Nicholas Financial, Inc.
            Condensed Consolidated Statements of Income
                            (Unaudited)


<TABLE>
<CAPTION>
                               Three months ended         Nine months ended
                                   December 31,              December 31,
                                2003         2002         2003          2002
                             ---------------------------------------------------
<S>                         <C>            <C>        <C>         <C>
Revenue:
Interest income on
 finance receivables         $6,334,652   $5,350,248   $18,397,452   $16,075,736
Sales                            50,447       78,850       192,755       254,165
                             ---------------------------------------------------
                              6,385,099    5,429,098    18,590,207    16,329,901

Expenses:
Cost of sales                    10,456       19,865        39,145        62,685
Marketing                       221,459      172,388       653,282       481,729
Administrative                2,437,986    2,012,342     7,235,719     6,108,890
Provision for credit losses     632,873      548,554     1,617,028     1,677,758
Depreciation                     30,000       51,000       162,218       130,000
Interest expense                950,109    1,023,976     2,905,747     2,955,671
                              --------------------------------------------------
                              4,282,883    3,828,125    12,613,139    11,416,733
                              --------------------------------------------------
Operating income
 before income taxes          2,102,216    1,600,973     5,977,068     4,913,168

Income tax expense:
 Current                      1,060,332    1,585,769     3,356,708     2,667,527
 Deferred                      (264,155)    (993,962)   (1,100,546)     (832,845)
                              --------------------------------------------------
                                796,177      591,807     2,256,162     1,834,682
                              --------------------------------------------------
Net income                   $1,306,039   $1,009,166    $3,720,906    $3,078,486
                             ===================================================
Earnings per share - basic        $0.26        $0.20         $0.74         $0.62
                             ===================================================
Earnings per share - diluted      $0.24        $0.19         $0.69         $0.58
                             ===================================================
Dividends declared                    -            -         $0.10             -
                             ===================================================

</TABLE>

See accompanying notes.

<PAGE> 5

                    Nicholas Financial, Inc.
          Condensed Consolidated Statements of Cash Flows
                            (Unaudited)


<TABLE>
<CAPTION>
                                   Nine months ended December 31,
                                       2003             2002
                                 -----------------------------------
<S>                                <C>              <C>

Operating activities
Net income                          $ 3,720,906      $ 3,078,486
Adjustments to reconcile net
 income to net cash provided
 by operating activities:
Depreciation                             162,218         130,000
Provision for credit losses            1,617,028       1,677,758
Deferred income taxes                 (1,100,546)       (832,845)
Changes in operating
 assets and liabilities:
Accounts receivable                      (16,167)         (5,098)
Prepaid expenses, other assets
 and assets held for resale             (400,466)       (350,677)
Accounts payable and
 other liabilities                       477,803        (805,737)
Drafts payable                          (190,933)       (109,392)
Income taxes payable                    (201,379)        921,902
Deferred revenues                        128,318         294,402
                                     ----------------------------
 Net cash provided by
  operating activities                 4,196,782       3,998,799

Investing activities
Purchase and origination
 of finance contracts                (48,982,384)    (43,112,044)
Principal payments received           40,708,394      35,754,549
Purchase of property and
 equipment, net of disposals            (255,749)       (165,969)
                                     ----------------------------
 Net cash used in investing
  activities                          (8,529,739)     (7,523,464)

Financing activities
Issuance of notes payable -
 related party                           172,920         112,094
Net proceeds from line of credit       5,850,052       4,060,000
Payment of dividend                     (253,359)              -
Sale of common stock                     243,321          40,173
                                     ---------------------------
 Net cash provided by
  financing activities                 6,012,939       4,212,267
                                     ---------------------------
Net increase in cash                   1,679,982         687,602

Cash, beginning of period                481,211          51,239
                                     ---------------------------
Cash, end of period                  $ 2,161,193       $ 738,841
                                     ===========================

</TABLE>

See accompanying notes.

<PAGE> 6


                     Nicholas Financial, Inc.
     Notes to the Condensed Consolidated Financial Statements
                           (Unaudited)

                        December 31, 2003


1. Basis of Presentation

The   accompanying  unaudited  condensed  consolidated  financial
statements of Nicholas Financial, Inc. (the "Company") have  been
prepared  in  accordance  with  accounting  principles  generally
accepted  in  the United States for interim financial information
and  with  the  instructions  to  Form  10-QSB  pursuant  to  the
Securities and Exchange Act of 1934, as amended in Article 10  of
Regulation  SB.  Accordingly, they do  not  include  all  of  the
information  and  footnotes  required  by  accounting  principles
generally  accepted  in the United States for complete  financial
statements.   In  the  opinion  of  management,  all  adjustments
(consisting  of  normal recurring accruals) considered  necessary
for a fair presentation have been included. Operating results for
interim  periods are not necessarily indicative  of  the  results
that  may be expected for the fiscal year ending March 31,  2004.
For  further  information,  refer to the  condensed  consolidated
financial  statements  and  footnotes  thereto  included  in  the
Company's  Annual Report on Form 10-KSB for the year ended  March
31, 2003, as filed with the Securities and Exchange Commission on
June 30, 2003.

2. Revenue Recognition

Interest  income on finance receivables is recognized  using  the
interest   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.

The  Company attributes all of its dealer discount and a  portion
of unearned income to a reserve for credit losses.   Such amounts
reduce the interest recognized over the life of the contract. The
Company  receives  a  commission for selling add-on  services  to
consumer  borrowers  and  amortizes the commission,  net  of  the
related  costs,  over  the term of the loan  using  the  interest
method. The Company's net fees charged for processing a loan  are
recognized  as an adjustment to the yield and are amortized  over
the life of the loan using the interest method.

The  amount  of future unearned income represents the  amount  of
finance  charges the Company expects to fully earn over the  life
of  the current portfolio, and is computed as the product of  the
contract  rate, the contract term, and the contract  amount.  The
Company  aggregates the contracts purchased during a  three-month
period  for  all of its branch locations. After the  analysis  of
purchase  date accounting is complete, any uncollectable  amounts
would be contemplated in the allowance for credit losses.

<PAGE> 7


                    Nicholas Financial, Inc.
     Notes to the Condensed Consolidated Financial Statements
                           (continued)
                           (Unaudited)






3. 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:


<TABLE>
<CAPTION>

                                  Three months ended       Nine months ended
                                      December 31,            December 31,
                                    2003       2002         2003        2002
                               ------------------------------------------------
<S>                             <C>        <C>        <C>        <C>
Numerator for earnings
per share - net income         $1,306,039   $1,009,166   $3,720,906  $3,078,486
                               ================================================

Denominator:
 Denominator for basic
  earnings per share -
  weighted average shares       5,064,623    5,003,592    5,036,730   5,004,470

 Effect of dilutive securities:
  Employee stock options          374,366      274,025      359,085     307,607
                               ------------------------------------------------

 Denominator for diluted
  earnings per share            5,438,989    5,277,617    5,395,815   5,312,077
                               ================================================
Earnings per share - basic          $0.26        $0.20        $0.74       $0.62
                               ================================================
Earnings per share - diluted        $0.24        $0.19        $0.69       $0.58
                               ================================================

</TABLE>

<PAGE> 8


                    Nicholas Financial, Inc.
     Notes to the Condensed Consolidated Financial Statements
                           (continued)
                           (Unaudited)


4. Finance Receivables

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

 Finance receivables, gross contract      $147,649,215
    Less: Unearned interest                (34,935,642)
                                         --------------
    Finance receivables, net
     of unearned interest                  112,713,573
       Dealer discounts                    (13,593,218)
       Allowance for credit losses          (6,285,283)
                                         --------------
    Finance receivables, net              $ 92,835,072
                                         ==============


The terms of the receivables range from 12 to 60 months and bear
a weighted average effective interest rate of  approximately 24%.


5. Line of Credit

The  Company has a $75 million Line of Credit facility (the Line)
which  expires on November 30, 2004. The Company may  borrow  the
lesser  of  the  $75  million  or  amounts  based  upon  formulas
principally   related  to  a  percentage  of   eligible   finance
receivables, as defined. Borrowings under the Line may  be  under
various  LIBOR pricing options or at the prime rate plus  twenty-
five basis points. Prime rate based borrowings are generally less
than  $5  million. Pledged as collateral for this credit facility
are  all of the assets of Nicholas Financial, Inc. As of December
31,  2003  the  outstanding amount of  the  credit  facility  was
approximately $66 million and the amount available under the line
of  credit was approximately $9 million. As of December 31,  2003
the Company was in full compliance with all debt covenants.

6. Notes Payable - Related Party

The  Company's  notes payable consist of unsecured notes  bearing
interest at 6.29% with principal and interest due within  30-days
upon demand. The notes totaled $981,530 at December 31, 2003  and
are held by a related party.

<PAGE> 9
                     Nicholas Financial, Inc.
     Notes to the Condensed Consolidated Financial Statements
                           (continued)
                           (Unaudited)


7. Derivatives and Hedging

  The Company is party to interest rate swap agreements which are
derivative  instruments.  For  derivative  instruments  that  are
designated  and qualify as a cash flow hedge (i.e.,  hedging  the
exposure  to  variability in expected future cash flows  that  is
attributable to a particular risk, such as interest  rate  risk),
the  effective  portion  of the gain or loss  on  the  derivative
instrument is reported as a component of comprehensive income and
reclassified  into earnings in the same period or periods  during
which the hedged transaction affects earnings. The remaining gain
or  loss on the derivative instrument in excess of the cumulative
change  in  the  present value of the future cash  flows  of  the
hedged item, if any, is recognized in current earnings during the
period of change.

The  Company has entered into interest rate swap agreements  that
effectively  convert  a portion of its floating-rate  debt  to  a
fixed-rate  basis,  thus  reducing the impact  of  interest  rate
changes  on  future  interest  expense.  At  December  31,   2003
$50,000,000  of the Company's borrowings have been designated  as
the hedged items to interest rate swap agreements. Under the swap
agreements,  the  Company received an average  variable  rate  of
3.35% and 4.08% and paid an average fixed rate of 5.73% and 7.07%
during  the  three  months  ended December  31,  2003  and  2002,
respectively. Under the swap agreements, the Company received  an
average  variable  rate of 3.45% and 3.98% and  paid  an  average
fixed  rate  of  6.03%  and 6.93% during the  nine  months  ended
December  31,  2003 and 2002, respectively. A loss of  $1,351,076
related  to the fair value of the swaps at December 31, 2003  has
been  recorded  in the caption derivatives on the balance  sheet.
Amounts  of net losses on derivative instruments expected  to  be
reclassified from comprehensive income to earnings in the next 12
months  are  not  expected to be material. The Company  has  also
entered  into  one  forward locking swap included  in  the  table
below.

The Company has entered into the following cash-flow hedges:

<TABLE>
<CAPTION>

    Date              Effective      Notional   Fixed Rate   Maturity
   Entered              Date          Amount    Of Interest    Date
------------------------------------------------------------------------
<S>                <C>             <C>           <C>     <C>
 May 17, 2000       May 17, 2000    $10,000,000   6.87%   May 17, 2004
 October 5, 2001    October 5, 2001 $10,000,000   3.85%   October 5, 2004
 June 28, 2002      June 28, 2002   $10,000,000   3.83%   July 2, 2005
 January 6, 2003    April 2, 2003   $10,000,000   3.35%   April 2, 2007
 January 31, 2003   August 1, 2003  $10,000,000   3.20%   August 2, 2006
 February 26, 2003  May 17, 2004    $10,000,000   3.91%   May 19, 2008

</TABLE>

The  Company  has also entered into various interest rate  option
agreements with maturities through May 17, 2004.

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. There has historically  been  no
ineffectiveness associated with the Company's hedges.

<PAGE> 10


                    Nicholas Financial, Inc.
     Notes to the Condensed Consolidated Financial Statements
                           (continued)
                           (Unaudited)


8. Stock Options

The  Company  has an employee stock incentive plan for  officers,
directors and key employees under which 548,066 shares of  common
stock were reserved for issuance as of December 31, 2003. Options
currently  granted by the Company generally vest over a five-year
period.

As  permitted  under Statement of Financial Accounting  Standards
(SFAS)  No.  148,  "Accounting  for  Stock-Based  Compensation  -
Transaction  and Disclosure"' which amended SFAS 123, "Accounting
for  Stock-Based  Compensation",  the  Company  has  elected   to
continue  to follow the intrinsic value method in accounting  for
its stock-based employee compensation arrangements as defined  by
Accounting Principles Board Opinion (APB) No. 25, "Accounting for
Stock Issued to Employees", and related interpretations including
FASB  Interpretation No. 44, "Accounting for Certain Transactions
Involving Stock Compensation", an interpretation of APB.  25.  No
stock-based   employee   compensation  cost   is   reflected   in
operations,  as  all options granted under those  plans  have  an
exercise  price  equal  to  or above  the  market  value  of  the
underlying common stock on the date of grant.

The fair value method uses the Black-Scholes option-pricing model
to  determine compensation expense associated with the  Company's
options.  The follow table illustrates the effect on  net  income
and  net  income  per share if the Company had applied  the  fair
value  recognition provisions of SFAS 123 to stock-based employee
compensation:

<TABLE>
<CAPTION>
                            Three months ended      Nine months ended
                               December 31,             December 31,
                             2003        2002         2003       2002
                        -------------------------------------------------
<S>                      <C>         <C>         <C>         <C>
Net Income                $1,306,039  $1,009,166  $3,720,906  $3,078,486
 Basic earnings
  per share                    $0.26       $0.20       $0.74       $0.62
 Fully diluted
  earnings per share           $0.24       $0.19       $0.69       $0.58

 Stock based employee
  compensation cost under
  the Fair Value Method      $10,509     $15,282     $32,535     $59,594
Pro forma net income      $1,295,530    $993,884  $3,688,371  $3,018,892
 Pro forma basic
  earnings per share           $0.26       $0.19       $0.73       $0.60

 Pro forma diluted
   earnings per share          $0.24       $0.18       $0.68       $0.57

</TABLE>

<PAGE> 11


                    Nicholas Financial, Inc.
     Notes to the Condensed Consolidated Financial Statements
                           (continued)
                           (Unaudited)





9. Comprehensive Income

The  Company is party to interest rate swap agreements which  are
derivative  instruments.  For  derivative  instruments  that  are
designated  and qualify as a cash flow hedge (i.e.,  hedging  the
exposure  to  variability in expected future cash flows  that  is
attributable to a particular risk, such as interest  rate  risk),
the  effective  portion  of the gain or loss  on  the  derivative
instrument is reported as a component of comprehensive income and
reclassified  into earnings in the same period or periods  during
which the hedged transaction affects earnings.

The  following  table  reconciles net income  with  comprehensive
income for the three and nine months ended December 31, 2003  and
2002.

<TABLE>
<CAPTION>

                      Three months ended        Nine months ended
                          December 31,             December 31,
                        2003        2002         2003        2002
                    ------------------------------------------------
<S>                 <C>         <C>         <C>         <C>
Net income           $1,306,039  $1,009,166  $3,720,906  $3,078,486

Mark to market
 - interest rate
 swaps(net of tax)      361,673      80,676     561,300    (573,911)
                    ------------------------------------------------
Comprehensive
 income              $1,667,712  $1,089,842  $4,282,206  $2,504,575
                    ================================================

</TABLE>


<PAGE> 12


Part I. Item 2
         MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                CONDITION AND RESULTS OF OPERATIONS
Introduction

   Consolidated net income increased for the three and nine month
periods  ended  December 31, 2003 to $1,306,039  and  $3,720,906,
respectively, compared to $1,009,166 and $3,078,486 for the three
and  nine  month  periods ended December 31, 2002,  respectively.
Earnings   were  favorably  impacted  by  an  increase   in   the
outstanding  loan portfolio, a reduction in the average  cost  of
borrowed  funds  and  a  reduction in the  charge-off  rate.  The
Company's  software subsidiary, Nicholas Data Services  (NDS),did
not  contribute significantly to consolidated operations  in  the
three or nine month periods ended December 31, 2003 or 2002.

                        Portfolio Summary
                        -----------------

<TABLE>
<CAPTION>
                        Three  months ended     Nine  months ended
                              December 31,         December 31,
                          2003       2002      2003      2002
                  -------------------------------------------------
<S>                    <C>        <C>        <C>        <C>

Average finance
 receivables, net of
 unearned interest(1) $112,338,303  $98,504,403  $110,248,781  $96,554,714
                      ====================================================
Average
 indebtedness (2)      $66,328,452  $57,952,802   $64,243,278  $56,899,973
                      ====================================================

Total finance
 revenue(3)             $6,334,652   $5,350,248   $18,397,452  $16,075,736

Interest expense           950,109    1,023,976     2,905,747    2,955,671

Net finance revenue     $5,384,543   $4,326,272   $15,491,705  $13,120,065
                      ====================================================

Weighted average
contractual rate(5)         23.85%       23.79%        24.02%       24.21%
                           =================================================

Average cost of
borrowed funds (2)           5.73%        7.07%         6.03%        6.93%
                           =================================================

Gross portfolio yield(4)    22.56%       21.73%        22.25%       22.20%

Interest expense as a
percentage of average
finance  receivables,
net of unearned interest     3.38%        4.16%         3.51%        4.08%

Provision for credit
losses as a percentage
of average finance
receivables, net of
unearned interest            2.25%        2.23%         1.96%        2.32%

Net portfolio yield(4)      16.93%       15.34%        16.78%       15.80%

Expenses as a percentage
of average finance
receivables, net of
unearned interest (6)        9.39%        8.69%         9.51%        8.88%

Pre-tax yield as a
percentage of average
finance receivables,
net of unearned interest(7)  7.54%        6.65%         7.27%        6.92%
                            ================================================
Write-off to
liquidation(8)               9.64%       11.97%         9.12%        9.88%
Net charge-off
percentage (9)               8.11%       10.50%         7.79%        8.62%

</TABLE>

<PAGE> 13

(1) Average   finance  receivables,  net  of  unearned   interest
    represents  the  average of gross finance  receivables,  less
    unearned interest throughout the period.

(2) Average   indebtedness  represents  the  average  outstanding
    borrowings  under  the Line and notes payable-related  party.
    Average  cost  of borrowed funds represents interest  expense
    as a percentage of average indebtedness.

(3) Total  finance revenue does not include revenue generated  by
    NDS.  See  page  14 for detail on NDS revenue for  the  three
    months  ended  December 31, 2003 and 2002, respectively.  See
    page  15 for detail on NDS revenue for the nine months  ended
    December 31, 2003 and 2002, respectively.

(4) Gross portfolio yield represents total finance revenues as  a
    percentage  of average finance receivables, net  of  unearned
    interest. Net portfolio yield represents net finance  revenue
    minus  the  provision for credit losses as  a  percentage  of
    average finance receivables, net of unearned interest.

(5) Weighted  average  contractual rate represents  the  weighted
    average   annual  percentage  rate  (APR)  of  all  contracts
    purchased  during  the three and nine months  ended  December
    31, 2003 and 2002, respectively.

(6) Operating  expenses  do  not include  interest  expense,  the
    provision  for credit losses or operating expenses associated
    with  NDS.  See page 14 for detail on NDS operating  expenses
    for  the  three  months ended December  31,  2003  and  2002,
    respectively.  See  page  15  for  detail  on  NDS  operating
    expenses  for  the nine months ended December  31,  2003  and
    2002, respectively.

(7) Pre-tax  yield represents net portfolio yield minus operating
    expenses as a percentage of average finance receivables,  net
    of unearned interest.

(8)      Liquidation  is defined as beginning receivable  balance
    plus    current    period   purchases   minus    voids    and
    refinances minus ending receivable balance.

(9) Net  charge-off percentage represents net charge-offs divided
    by  average  finance  receivables, net of  unearned  interest
    outstanding during the period.


Note:For  comparability purposes, all three and  nine  month  key
     performance  indicators expressed as percentages  have  been
     annualized.

<PAGE> 14


Three months ended December 31, 2003 compared to three months ended
December 31, 2002


 Interest Income and Loan Portfolio

       Interest  income  increased 18% to $6.3  million  for  the
period  ended December 31, 2003, from $5.4 million for the period
ended December 31, 2002. The average finance receivables, net  of
unearned  interest equaled $112.3 million for  the  period  ended
December 31, 2003, an increase of 14% from the $98.5 million  for
the  period  ended December 31, 2002. The primary reason  average
finance  receivables, net of unearned interest increased was  the
increase in the receivable base of several existing branches  and
the opening of two additional branch locations. The gross finance
receivable balance increased 15% to $148 million at December  31,
2003  from $129 million at December 31, 2002. The primary  reason
interest  income  increased was the increase in  the  outstanding
loan  portfolio. The gross portfolio yield increased from  21.73%
for  the period ended December 31, 2002 to 22.56% for the  period
ended  December 31, 2003. The net portfolio yield increased  from
15.34%  for the period ended December 31, 2002 to 16.92% for  the
period  ended  December  31, 2003. The primary  reasons  for  the
increase in the net portfolio yield was a decrease in charge-offs
and  a  reduction in the cost of borrowed funds  for  the  period
ended  December 31, 2003. The net charge-off percentage  for  the
period  ended December 31, 2003 was 8.11% compared to 10.50%  for
the period ended December 31, 2002.

 Computer Software Business

   Sales  for  the  period ended December 31, 2003  were  $50,447
compared  to  $78,850 for the period ended December 31,  2002,  a
decrease of 36%. This decrease was primarily due to lower revenue
from  the existing customer base during the period ended December
31,  2003.  Cost  of sales and operating expenses decreased  from
$115,073  for the period ended December 31, 2002 to  $65,754  for
the period ended December 31, 2003.

Expenses

       Operating expenses, excluding provision for credit  losses
and  interest expense, increased to $2.6 million for  the  period
ended  December 31, 2003 from $2.2 million for the  period  ended
December   31,   2002.  This  increase  of  18%   was   primarily
attributable  to  the  additional staffing  of  several  existing
branches, increased general operating expenses and the opening of
two additional branch offices. Operating expenses as a percentage
of  finance receivables, net of unearned interest increased  from
8.69%  for  the period ended December 31, 2002 to 9.38%  for  the
period ended December 31, 2003.

 Interest Expense

      Interest expense decreased to $950,109 for the period ended
December 31, 2003 as compared to $1,023,976 for the period  ended
December 31, 2002. The average indebtedness for the period  ended
December  31, 2003 increased to $66.3 million compared  to  $58.0
million for the period ended December 31, 2002. This increase was
offset  by a decrease in the average cost of borrowed funds  from
7.07%  during the three months ended December 31, 2002  to  5.73%
during the three months ended December 31, 2003.


<PAGE> 15



Nine months ended December 31, 2003 compared to nine months ended
December 31, 2002


 Interest Income and Loan Portfolio

       Interest  income increased 14% to $18.4  million  for  the
period ended December 31, 2003, from $16.1 million for the period
ended December 31, 2002. The average finance receivables, net  of
unearned  interest equaled $110.2 million for  the  period  ended
December 31, 2003, an increase of 14% from the $96.6 million  for
the  period  ended December 31, 2002. The primary reason  average
finance  receivables, net of unearned interest increased was  the
increase in the receivable base of several existing branches  and
the opening of two additional branch locations. The gross finance
receivable balance increased 15% to $148 million at December  31,
2003  from $129 million at December 31, 2002. The primary  reason
interest  income  increased was the increase in  the  outstanding
loan  portfolio. The gross portfolio yield increased from  22.20%
for  the period ended December 31, 2002 to 22.25% for the  period
ended  December 31, 2003. The net portfolio yield increased  from
15.80%  for the period ended December 31, 2002 to 16.78% for  the
period  ended  December  31, 2003. The primary  reasons  for  the
increase  in  the net portfolio yield was a decrease  in  charge-
offs,  a  reduction  in the provision for  credit  losses  and  a
reduction  in  the  cost of borrowed funds for the  period  ended
December  31, 2003. The net charge off percentage for the  period
ended  December  31, 2003 was 7.79% compared  to  8.62%  for  the
period ended December 31, 2002.

 Computer Software Business

   Sales  for  the period ended December 31, 2003  were  $192,755
compared  to $254,165 for the period ended December 31,  2002,  a
decrease of 24%. This decrease was primarily due to lower revenue
from  the  existing customer base during the nine  month  period.
Cost of sales and operating expenses decreased from $351,059  for
the  period  ended December 31, 2002 to $230,509 for  the  period
ended December 31, 2003.

 Expenses

       Operating expenses, excluding provision for credit  losses
and  interest expense, increased to $7.9 million for  the  period
ended  December 31, 2003 from $6.7 million for the  period  ended
December   31,   2002.  This  increase  of  18%   was   primarily
attributable  to  the  additional staffing  of  several  existing
branches, increased general operating expenses and the opening of
two additional branch offices. Operating expenses as a percentage
of  finance receivables, net of unearned interest increased  from
8.88%  for  the period ended December 31, 2002 to 9.51%  for  the
period ended December 31, 2003.

 Interest Expense

       Interest  expense was $2.9 million for  the  period  ended
December  31,  2003 as compared to $3.0 million  for  the  period
ended  December 31, 2002. The average indebtedness for the period
ended  December 31, 2003 increased to $64.2 million  compared  to
$56.9  million  for  the  period ended December  31,  2002.  This
increase was offset by a decrease in the average cost of borrowed
funds  from 6.93% during the nine months ended December 31,  2002
to 6.03% during the nine months ended December 31, 2003.

<PAGE> 16


Contract Procurement

  The Company purchases contracts in the states listed below. The
Company  has  been  expanding its contract procurement  in  South
Carolina,   Ohio,  Michigan  and  Virginia.  Please  see   Future
Expansion.   The   contracts  purchased  by   the   Company   are
predominately  for  used vehicles, less than  3%  were  new.  The
average  model  year  collateralizing the  portfolio  is  a  1998
vehicle.

   The  amounts  shown in the table below represent  the  finance
receivables,  net  of  unearned interest  of  indirect  contracts
purchased.

<TABLE>
<CAPTION>

              Maximum
             allowable
             Interest        3 Months Ended            9 Months Ended
     State    rate (1)    12/31/03    12/31/02     12/31/03      12/31/02
 =============================================================================
    <S>       <C>      <C>          <C>          <C>           <C>
      FL       30%      $8,226,294   $7,667,048   $27,210,545   $26,790,694

      GA       29%       1,802,773    1,844,048     6,384,776     5,679,668

      NC       29%       1,581,909    1,755,160     5,548,857     5,694,837

      SC       29%         664,595      568,994     2,144,234     1,667,627

      OH       25%       2,267,575    1,714,623     8,453,317     5,373,214

      VA       29%         438,850       10,432       611,901        65,475

      MI       29%         597,254            -     1,665,511             -
                      ------------------------------------------------------
   Total               $15,579,250  $13,560,305   $52,019,141   $45,271,515
                      ======================================================

</TABLE>



      (1) The allowable maximum interest rates by State is subject
        to change and are governed  by  the  individual states the
        Company conducts business in.

<TABLE>
<CAPTION>


                   Indirect Contracts Purchased
                 ---------------------------------


                            3 Months Ended            9 Months Ended
                         12/31/03   12/31/02       12/31/03    12/31/02
    -------------------------------------------------------------------
      <S>             <C>          <C>          <C>          <C>
       Purchases       $15,579,250  $13,560,305  $52,019,141  $45,271,515
       Weighted APR         23.66%       23.66%       23.88%       24.11%
       Average Discount      8.80%        9.00%        8.91%        8.87%
       Average Term(mnths)      43           40           43           41
       Average Loan         $8,110       $8,091       $8,128       $8,157
       Number of Contracts   1,921        1,676        6,400        5,550

</TABLE>


Loan Origination

The  following  table  represents  information  on  direct  loans
originated by the Company, net of unearned interest.

<TABLE>
                     Direct Loans Originated
                    -------------------------

                      3 Months Ended           9 Months Ended
                    12/31/03   12/31/02      12/31/03    12/31/02
   ---------------------------------------------------------------
  <S>               <C>          <C>       <C>         <C>
   Originations      $1,047,014   $935,909  $2,940,870  $2,982,344
   Weighted APR          26.64%     26.60%      26.52%      26.07%
   Average Term(mnths)       24         20          26          21
   Average Loan          $2,755     $2,713      $2,844      $2,988
   Number of Loans          380        345       1,034         998

</TABLE>

<PAGE> 17


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 68 Contracts
with  an  aggregate finance receivables, net of unearned interest
of  approximately $554,000. As of December 31, 2003, the  Company
had 469 active pools.

   The  Company  pools  Contracts according  to  branch  location
because  the  branches  purchase contracts in  different  markets
located  in  Florida,  Georgia, North Carolina,  South  Carolina,
Virginia, Michigan and Ohio. 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.

  Contracts are purchased from many different dealers and are all
purchased on an individual contract by contract basis. Individual
contract pricing is determined by the automobile dealerships  and
is  generally the lesser of state maximum interest rates  or  the
maximum  interest  rate  at which the customer  will  accept.  In
certain  markets,  competitive forces will  drive  down  contract
rates  from  the  maximum  rate to a level  where  an  individual
competitor is willing to buy an individual contract. The  Company
only  buys  contracts on an individual basis and never  purchases
contracts in batches.

   Dealer  discounts  represent the  difference  between  finance
receivables, net of unearned interest of an installment  contract
and  the  amount  of  money the Company  actually  pays  for  the
contract. The discount negotiated by the Company is a function of
the credit quality of the customer and the wholesale value of the
vehicle. The automotive dealer accepts these terms by executing a
dealer  agreement with the Company. The entire amount of discount
relates  to  credit quality and is considered to be part  of  the
credit  loss reserve. The Company utilizes a static pool approach
to  track portfolio performance. A static 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  through  the
provision is used to reestablish adequate reserves. If a pool  is
fully  liquidated  and  has any remaining  reserves,  the  excess
reserves  are immediately recognized into income. For  pools  not
fully  liquidated, that are determined to have  excess  reserves,
such  excess amounts are accreted into income over the  remaining
life  of  the pool. Reserves accreted into income for  the  three
month  period ended December 31, 2003 were $442,665  compared  to
$301,326 in the period ended December 31, 2002. Reserves accreted
into  income  for the nine months ended December  31,  2003  were
$1,439,542  compared to $1,415,651 for the period ended  December
31, 2002.

   The Company has definitive underwriting guidelines it utilizes
to  determine  which contracts to purchase. These guidelines  are
very specific and result in all loan purchases having common risk
characteristics.  The Company utilizes its District  Managers  to
evaluate their respective branch locations for adherence to these
underwriting  guidelines. The Company also utilizes  an  internal
audit   department  to  assure  adherence  to  its   underwriting
guidelines.  The Company utilizes the branch model  which  allows
for  contract  purchasing to be done on the  branch  level.  Each
Branch Manager will interpret the guidelines differently and as a
result  the  common risk characteristics will be the same  on  an
individual  branch level but not necessarily compared to  another
branch.

   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.

<PAGE> 18




The following table sets forth a reconciliation of the changes in
dealer discounts on indirect contracts.

<TABLE>
<CAPTION>

                          Three months ended     Nine months ended
                              December 31,           December 31,
                          2003        2002        2003         2002
                        ----------------------------------------------
<S>                    <C>        <C>          <C>          <C>
Balance at beginning
 of period              $13,693,963 $11,850,964   $12,394,089  $11,098,758
Discounts acquired
 on new volume            2,504,121   2,160,225     8,468,596    7,378,298
Losses absorbed          (2,420,384) (2,748,703)   (6,668,320)  (6,625,413)
Recoveries                  258,184     280,002       838,396      805,170
Discounts accreted         (442,665)   (301,326)   (1,439,542)  (1,415,651)
                        ---------------------------------------------------
Balance at end of
  period                $13,593,219 $11,241,162   $13,593,219   $11,241,162
                        ===================================================

Dealer discounts
 as a percent of
 gross indirect
 contracts                    9.50%       9.05%         9.50%         9.05%

</TABLE>

<TABLE>
<CAPTION>

The following table sets forth a reconciliation of the changes in
the allowance for credit losses on indirect contracts.

                        Three months ended          Nine months ended
                           December 31,               December 31,
                         2003        2002          2003          2002
                    ------------------------------------------------------
<S>                  <C>          <C>           <C>          <C>
Balance at beginning
 of period            $5,774,119   $4,980,530   $5,428,681    $4,266,314
Current period
 provision               467,085      447,398    1,331,193     1,457,387
Losses absorbed         (129,872)     (97,300)    (648,542)     (393,073)
                     ----------------------------------------------------
Balance at end
 of period            $6,111,332   $5,330,628   $6,111,332    $5,330,628
                     ====================================================
Allowance as a percent
 of gross indirect
 contracts                 4.27%        4.29%         4.27%        4.29%

</TABLE>


<TABLE>
<CAPTION>

The following table sets forth a reconciliation of the changes in
the allowance for credit losses on direct loans.

                         Three months  ended        Nine months ended
                             December 31,              December 31,
                           2003        2002          2003        2002
                    -------------------------------------------------------
<S>                    <C>          <C>           <C>          <C>
Balance at beginning
 of period              $201,349     $202,310      $176,126     $200,612
Current period
 provision                87,660      101,156       207,707      220,371
Losses absorbed          (55,235)     (57,929)     (138,974)    (156,982)
Recoveries                 9,638        8,921        22,627       24,052
Discounts accreted       (69,461)     (36,763)      (93,535)     (70,358)
                     ----------------------------------------------------
Balance at end
 of period              $173,951     $217,695      $173,951     $217,695
                     ====================================================
Allowance as a percent
 of gross direct loan
 receivables               3.83%        4.58%         3.83%        4.58%


</TABLE>

Total Discounts and
 Allowances at end
 of period           $19,878,501  $16,789,485   $19,878,501  $16,789,485
                     ====================================================
Discounts and
 Allowances as a
 percent of gross
 receivables              13.46%       13.02%        13.46%       13.02%

<PAGE> 19


    The  average  dealer  discount  associated  with  new  volume
remained consistent with last year. For the three and nine months
ended  December 31, 2003 the average discount was 8.80% and 8.91%
respectively,  as compared to 8.98% and 8.87% for the  three  and
nine  months  ended December 31, 2002, respectively. The  Company
does  not  consider these changes to be material and is  not  the
result of any change in buying philosophy or competition.

    The provision for credit losses increased to $632,873 for the
three  months ended December 31, 2003 from $548,554 for the three
months  ended  December  31,  2002. For  the  nine  months  ended
December  31,  2003 the provision for credit losses decreased  to
$1,617,028  compared  to $1,677,758 for  the  nine  months  ended
December 31, 2002.

   The  Company's  write-offs  as  a  percentage  of  liquidation
decreased  from  11.97% and 9.88% for the  three  and  nine-month
periods ended December 31, 2002, respectively, to 9.64% and 9.12%
for  the  three and nine-month periods ended December  31,  2003,
respectively. The Company anticipates portfolio performance  will
stabilize  in  the near term but will continue to  be  higher  in
relation  to past years when the overall economic conditions  and
unemployment  rate was better. In response to current  conditions
the  Company has raised its initial target reserve percentage  on
new  static  pools  to  12.4% from 11.8%. The  Company  does  not
believe   there  have  been  any  significant  changes  in   loan
concentrations,  terms or quality of contracts  purchased  during
the  current fiscal year that would have contributed to the  rise
in  losses.  The delinquency percentage for contracts  more  than
thirty days past due for the nine month period ended December 31,
2003  decreased to 2.71% from 3.07% for the period ended December
31,  2002. The delinquency percentage for direct loans more  than
thirty  days  past  due for the period ended  December  31,  2003
decreased  to  2.24% from 2.52% for the nine month  period  ended
December  31,  2002. The Company does not give much consideration
to  short-term  trends  in  delinquency when  evaluating  reserve
levels.  Delinquency  percentages tend to be  very  volatile  and
often  are  not necessarily an indication of future  losses.  The
Company  utilizes  a static pool approach to analyzing  portfolio
performance  and  looks at specific pool performance  and  recent
trends  as  leading  indicators  to  future  performance  of  the
portfolio.

    Recoveries  as  a percentage of write-offs  were  10.28%  and
11.55%  for  the three and nine-month periods ended December  31,
2003,  respectively, as compared to 10.00%  and  11.56%  for  the
three   and   nine-month  periods  ended   December   31,   2002,
respectively.  Recoveries are seasonally lower  in  the  December
quarter  and the current year results are consistent  with  prior
reporting periods.

   Reserves  accreted  into income for the three  and  nine-month
periods  ended  December 31, 2003 were $512,126  and  $1,533,077,
respectively,  as  compared to $338,089 and  $1,486,009  for  the
three   and   nine-month  periods  ended   December   31,   2002,
respectively.  The  amount and timing of reserves  accreted  into
income  is a function of individual static pool performance.  The
Company  has  seen  deterioration  in  the  performance  of   the
portfolio  for  static pools more than eighty percent  liquidated
when  compared  to historical pool performance  during  the  same
liquidation  cycle. The Company attributes this increase  to  the
gradual shift in recent years towards purchasing "simple interest
contracts"  as  opposed  to "pre-compute contracts".  This  shift
towards  simple  interest  contracts has  been  dictated  by  the
marketplace  and not by the Company. The difference  between  the
two  types of contracts is as follows: pre-compute contracts have
a  stated total interest and cannot be effected by the timeliness
or  amount  of  payments received. In contrast,  simple  interest
contracts  charge interest based on the timeliness and amount  of
payments received. Two identical contracts relative to the amount
financed,  term  and annual percentage rate of  interest  charged
"APR"  will result in different amounts of interest being charged
to  an individual based on the amount and timing of payments made
under  the  contract. The Company knows there  is  a  correlation
between  delinquency  and  losses as  a  result  simple  interest
contracts  will have greater principal balances at  the  time  of
loss  compared to a pre-compute contract. This greater  principal
balance at the time of repossession will result in a greater loss
subsequent to the sale of the repossessed vehicle.

<PAGE> 20

<TABLE>
<CAPTION>

   The following tables present certain information regarding the
delinquency  rates  experienced by the Company  with  respect  to
Indirect contracts purchased and Direct loans originated:



                      December 31, 2003      December 31, 2002
                   ----------------------  ----------------------
<S>                <C>  <C>     <C>          <C>   <C>      <C>
Indirect contracts
Gross balance
 outstanding             $143,113,043              $124,238,870

                       Dollar                   Dollar
Delinquencies          Amount    Percent*       Amount     Percent*
                      --------   --------      --------    --------
30 to 59 days        $2,836,531    1.98%       $2,595,883     2.09%
60 to 89 days           805,643    0.56%          852,351     0.69%
90   +  days            247,261    0.17%          363,195     0.29%
                     ----------   ------       ----------     -----
Total delinquencies  $3,889,435    2.71%       $3,811,429     3.07%


Direct Loans
Gross balance
 outstanding               $4,536,172                $4,753,330

Delinquencies

30 to 59 days          $ 37,451    0.83%         $ 52,074     1.10%
60 to 89 days            33,612    0.74%           46,896     0.99%
90 + days                30,354    0.67%           20,869     0.43%
                       --------    -----         --------    ------
Total delinquencies    $101,417    2.24%         $119,839     2.52%

*Delinquencies as a
percent of outstanding balance

</TABLE>

   The  delinquency percentage for indirect contracts  more  than
thirty  days  past  due for the period ended  December  31,  2003
decreased  to 2.71% from 3.07% for the period ended December  31,
2002.  The  delinquency  percentage for direct  loans  more  than
thirty  days  past  due for the period ended  December  31,  2003
decreased  to 2.24% from 2.52% for the period ended December  31,
2002.

   The  Company  does not give much consideration  to  short-term
trends in delinquency percentages when evaluating reserve levels.
Delinquency  percentages tend to be very volatile and  often  are
not  necessarily  an  indication of future  losses.  The  Company
utilizes   a   static   pool  approach  to  analyzing   portfolio
performance  and  looks at specific pool performance  and  recent
trends  as  leading  indicators  to  future  performance  of  the
portfolio.


Income Taxes

  The Company's effective tax rate remained relatively consistent
at  37.87% and 37.75% for the three and nine month periods  ended
December  31, 2003, respectively, compared to 36.97%  and  37.34%
for   the  three  and  nine  months  ended  December  31,   2002,
respectively.

<PAGE> 21



Liquidity and Capital Resources

  The  Company's  cash  flows for the nine  month  periods  ended
December  31,  2003  and  December 31,  2002  are  summarized  as
follows:

<TABLE>

                             Nine months ended  Nine months ended
                             December 31, 2003  December 31, 2002
                             -------------------------------------
<S>                             <C>               <C>
Cash provided by (used in):
      Operating Activities -     $4,196,782        $3,998,799

      Investing Activities -
      (primarily purchase of
       Contracts)                (8,529,739)       (7,523,464)

      Financing Activities        6,012,939         4,212,267

      Net increase in cash        1,679,982           687,602


</TABLE>

     The Company's primary use of working capital during the nine
months ended December 31, 2003 was the funding of the purchase of
Contracts.   The  Contracts were financed  substantially  through
borrowings  on  the  Line.  The  Line  is  secured  primarily  by
Contracts, and available borrowings are based on a percentage  of
qualifying  Contracts. As of December 31, 2003  the  Company  had
approximately  $9  million  available  under  the   Line.   Since
inception,  the Company has also funded a portion of its  working
capital needs through 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 its ability to borrow  under
the  terms  of  the  Line. The Company believes  that  borrowings
available  under  the Line as well as cash flow  from  operations
and,  if necessary, the issuance of additional subordinated  debt
and, or the sale of additional securities in the capital markets,
will be sufficient to meet its short term funding needs.

   The Company is currently negotiating an amendment to the Line.
The  amendment is to increase the amount of the Line  and  extend
the  maturity  date.  The  Company believes  it  will  have  this
amendment  completed prior to March 31, 2004, but  no  assurances
can be given that this amendment will be completed.

      On  August 11, 2003 the Company announced a $0.10 per share
annual cash dividend, payable semi-annual. The Company intends to
continue  its cash dividend program for the foreseeable, provided
that  future  earnings meet expectations. The Company  must  also
receive  waivers from its current lenders in order  to  pay  cash
dividends.  The ability for the Company to receive the  necessary
waivers  is  largely  dependent upon  portfolio  performance.  No
assurance can be given that these waivers will be granted.

<PAGE> 22



Future Expansion

     The Company currently operates twenty-nine branch locations,
sixteen  in  Florida, three in Georgia, three in North  Carolina,
five  in Ohio and one branch location in both Michigan and  South
Carolina.  Each  office is budgeted (size of  branch,  number  of
employees and location) to handle up to 1,000 accounts and up  to
$7.5  million  in outstanding receivables. To date  none  of  our
branches have reached this capacity.

   The  Company  currently  intends 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, either with its current
lender  or another lender.  The Company, from time to time,  has
and will meet with investment bankers and financial institutions
discussing  various strategies to meet the future needs  of  the
Company.  The Company believes opportunity for growth  continues
to  exist  in South Carolina, Ohio and Michigan and  intends  to
continue  its expansion activities in those states. The  Company
has  expanded  its automobile financing program in Virginia  and
has  opened its first branch location as of February  10,  2004.
The  Company  is  currently  developing  additional  markets  in
Pensacola, FL, Greenville, SC, Greensboro, NC, and Newport News,
VA.  The  Company  is  developing these  respective  markets  by
utilizing   its   Central  Buying  Office   in   its   Corporate
Headquarters in Clearwater FL to purchase, process  and  service
these Contracts. The Company's strategy is to monitor these  new
markets  and  ultimately decide where and when  to  open  actual
branch locations. No assurances can be given, however, that  any
further such expansion will occur.

Recently Issued Accounting Standards

   In  October  2003, the AICPA issued SOP 03-3, "Accounting  for
Loans or Certain Debt Securities Acquired in a Transfer." SOP 03-
3  applies  to  a loan with evidence of deterioration  in  credit
quality  subsequent  to  its  origination  that  is  acquired  by
completion of a transfer (as defined in SOP 03-3), for  which  it
is  probable at acquisition of such loan, that the acquirer  will
be   unable  to  collect  all  contractually  required   payments
receivable.  SOP  03-3 requires that the acquirer  recognize  the
excess  of  all  cash  flows expected  at  acquisition  over  the
investor's initial investment in the loan as interest income on a
level-yield  basis  over the life of the loan as  the  accretable
yield.  The  loan's contractual required payments  receivable  in
excess  of  the amount of its cash flows expected at  acquisition
(nonaccretable  difference)  should  not  be  recognized  as   an
adjustment to yield, a loss accrual or a valuation allowance  for
credit  risk. Subsequent increases in cash flows expected  to  be
collected  generally  would be recognized  prospectively  through
adjustment of the loan's yield over its remaining life. Decreases
in  cash  flows  expected to be collected would be recognized  as
impairment.  SOP 03-3 is effective for loans acquired  in  fiscal
years  beginning after December 31, 2004. Management is currently
evaluating the provisions of SOP 03-3.

Forward-Looking Information

   This  10-QSB  contains various forward-looking statements  and
information   that   are  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  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 have a direct  bearing  on  the
Company's operating results are fluctuations in the economy,  the
degree  and nature of competition, demand for consumer  financing
in  the markets served by the Company, the Company's products and
services,   increases  in  the  default  rates   experienced   on
Contracts,  adverse regulatory changes in the Company's  existing
and future markets, 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.


<PAGE> 23




Part I. Item 3

                    CONTROLS  AND PROCEDURES

    The  Company  maintains controls and procedures  designed  to
ensure  that information required to be disclosed in the  reports
that  the  Company files or submits under the Securities Exchange
Act  of  1934  is  recorded, processed, summarized  and  reported
within  the time periods specified in the rules and forms of  the
Securities  and Exchange Commission.  Based upon their evaluation
of  those controls and procedures performed as of the end of  the
period  covered  by  this quarterly report, the  chief  executive
officer  and the chief financial officer of the Company concluded
that  the  Company's  disclosure  controls  and  procedures  were
adequate.

      The  Company's Chief Executive Officer and Chief  Financial
Officer  have  evaluated  the change to  the  Company's  internal
control over financial reporting that occurred during our  fiscal
quarter ended December 31, 2003, as required by paragraph (d)  of
Rules  13a-15  and 15d-15 under the Securities  Exchange  Act  of
1934,  as  amended, and have concluded that there  were  no  such
changes  that  materially affected, or are reasonably  likely  to
material  affect, the Company's internal control  over  financial
reporting.


<PAGE> 24

                   Part II - Other Information



Item 6.                                                      (a)
Exhibits - See exhibit index following the signature page.

     (b)  Reports on Form 8-K -

    On  October  3, 2003, we filed a current report on  Form  8-K
announcing that on September 30, 2003, Ernst & Young LLP  advised
the  Company's  audit committee it would resign as the  Company's
independent  auditors. Ernst & Young's reports on  the  Company's
financial statements for the years ended March 31, 2003 and  2002
did  not  contain an adverse opinion or a disclaimer of  opinion,
and  were  not  qualified or modified as  to  uncertainty,  audit
scope,  or  accounting principles. During the fiscal years  ended
March  31, 2003 and 2002, and the subsequent interim period ended
September  30,  2003,  there  were no disagreements  between  the
Company  and Ernst & Young on any matter of accounting principles
or  practices, financial statement disclosures, or auditing scope
or  procedure,  which  disagreements,  if  not  resolved  to  the
satisfaction  of  Ernst & Young, would have  caused  it  to  make
reference   to  the  subject  matter  of  the  disagreements   in
connection with its reports.

        On December 4, 2003, we filed a current report on Form 8-
K   announcing  that  the  Company's  audit  committee   chairman
announced  that  effective December 3, 2003, the Company  engaged
the  accounting  firm  of  Crisp Hughes  Evans  LLP  as  its  new
independent auditors


<PAGE> 25

                           SIGNATURES

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


                    NICHOLAS FINANCIAL, INC.
                          (Registrant)


Date: February 13, 2004      /s/Peter L Vosotas
                             -------------------------
                             Peter L. Vosotas
                             Chairman, President,
                             Chief Executive Officer
                             (Principal Executive Officer)


Date: February 13, 2004      /s/Ralph T Finkenbrink
                             --------------------------
                             Ralph T. Finkenbrink
                             (Principal Accounting Officer)

<PAGE> 26

                          EXHIBIT INDEX

Item 6. Exhibits and Reports on Form 8-K

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

    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

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

10.1.10   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


<PAGE> 27

10.1.11   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

10.1.12   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

10.1.13  Amendment No. 11 to Loan Agreement dated August 1, 2000

    Incorporated   by  reference  to  Exhibit  10.1.13   to   the
    Company's Form 10-KSB for the year ended  March 31, 2001

10.1.14 Amendment No. 12 to Loan Agreement dated March 16, 2001

    Incorporated   by  reference  to  Exhibit  10.1.14   to   the
    Company's Form 10-KSB for the year ended  March 31, 2001

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

10.4.2   Employment  Contract,  dated  March  16,  2001,  between
    Nicholas  Financial, Inc. and Peter L. Vosotas   President  &
    Chief Executive Officer.

    Incorporated by reference to the Company's 2001 Annual  proxy
    statement dated July 2, 2001

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

24  Powers of Attorney (included on signature page hereto)

31.1   Written Certification of the Chief Executive Officer

31.2   Written Certification of the Chief Financial Officer

32.1
Written Statement of the Chief Executive Officer Pursuant  to  18
U.S.C.  1350

32.2
Written Statement of the Chief Financial Officer Pursuant  to  18
U.S.C.  1350


<PAGE> 28

                          Exhibit 31.1
                          CERTIFICATION

I, Peter L. Vosotas, certify that:

     1.I have reviewed this quarterly report on Form 10-QSB of
       Nicholas Financial, Inc.;

     2.Based on my knowledge, this report does not contain any untrue
       statement of a material fact or omit to state a material fact
       necessary  to  make the statements made, in light  of  the
       circumstances under which such statements were  made,  not
       misleading with respect to the period covered by this report;

     3.Based on my knowledge, the financial statements, and other
       financial information included in this report, fairly present in
       all material respects the financial condition, results  of
       operations and cash flows of the registrant as of, and for, the
       periods presented in this report;

     4.The registrant's other certifying officers and I are responsible
       for establishing and maintaining disclosure controls and
       procedures(as defined in Exchange Act Rules 13a-15(e) and
       15d-15(e)) for the registrant and have:

          a)Designed such disclosure controls and procedures, or caused such
            controls and procedures to be designed under our supervision, to
            ensure that material information relating to the registrant,
            including its consolidated subsidiaries, is made known to us by
            others within those entities, particularly during the period in
            which this report is being prepared;

          b)Evaluated the effectiveness of the registrant's disclosure
            controls and procedures and presented in this report our
            conclusions about the effectiveness of the disclosure controls
            and procedures, as of the end of the period covered by this
            report based on such evaluation; and

          c)Disclosed in this report any change in the registrant's internal
            control over financial reporting that occurred during the
            registrant's most recent fiscal quarter that has materially
            affected, or is reasonably likely to materially affect, the
            registrant's internal control over financial reporting; and

     5.The registrant's other certifying officer and I have disclosed,
       based on our most recent evaluation of internal control over
       financial reporting, to the registrant's auditors and the
       audit committee of registrant's board of directors (or persons
       performing the equivalent functions):

          a)all significant deficiencies in the design or operation of
            internal control over financial reporting which are reasonably
            likely to adversely affect the registrant's ability to record,
            process, summarize and report financial information; and

          b)any fraud, whether or not material, that involves management
            or other employees who have a significant role in the
            registrant's internal control over financial reporting.



Date: February 13, 2004           /s/Peter L Vosotas
                                  -----------------------
                                   Peter L. Vosotas
                                   President & CEO
<PAGE> 29

Exhibit 31.2

                          CERTIFICATION


I, Ralph T. Finkenbrink, certify that:

     1.I have reviewed this quarterly report on Form 10-QSB of
       Nicholas Financial, Inc.;

     2.Based on my knowledge, this report does not contain any untrue
       statement of a material fact or omit to state a material fact
       necessary  to  make the statements made, in light  of  the
       circumstances under which such statements were  made,  not
       misleading with respect to the period covered by this report;

     3.Based on my knowledge, the financial statements, and other
       financial information included in this report, fairly present in
       all material respects the financial condition, results  of
       operations and cash flows of the registrant as of, and for, the
       periods presented in this report;

     4.The registrant's other certifying officers and I are responsible
       for establishing and maintaining disclosure controls and
       procedures(as defined in Exchange Act Rules 13a-15(e) and
       15d-15(e)) for the registrant and have:

          a)Designed such disclosure controls and procedures, or caused such
            controls and procedures to be designed under our supervision, to
            ensure that material information relating to the registrant,
            including its consolidated subsidiaries, is made known to us by
            others within those entities, particularly during the period in
            which this report is being prepared;

          b)Evaluated the effectiveness of the registrant's disclosure
            controls and procedures and presented in this report our
            conclusions about the effectiveness of the disclosure controls
            and procedures, as of the end of the period covered by this
            report based on such evaluation; and

          c)Disclosed in this report any change in the registrant's internal
            control over financial reporting that occurred during the
            registrant's most recent fiscal quarter that has materially
            affected, or is reasonably likely to materially affect, the
            registrant's internal control over financial reporting; and

     5.The registrant's other certifying officer and I have disclosed,
       based on our most recent evaluation of internal control over
       financial reporting, to the registrant's auditors and the
       audit committee of registrant's board of directors (or persons
       performing the equivalent functions):

          a)all significant deficiencies in the design or operation of
            internal control over financial reporting which are reasonably
            likely to adversely affect the registrant's ability to record,
            process, summarize and report financial information; and

          b)any fraud, whether or not material, that involves management
            or other employees who have a significant role in the
            registrant's internal control over financial reporting.



Date: February 13, 2004            /s/Ralph T Finkenbrink
                                   ---------------------------
                                   Ralph T. Finkenbrink
                                   Senior Vice-President


<PAGE> 30

Exhibit 32.1
        Written Statement of the Chief Executive Officer
                   Pursuant to 18 U.S.C.  1350

   Solely for the purposes of complying with 18 U.S.C.  1350, I ,
the  undersigned  Chief Executive Officer of Nicholas  Financial,
Inc. (the "Company"), hereby certify, based on my knowledge, that
the  Quarterly  Report  on Form 10-QSB of  the  Company  for  the
quarter  ended  December 31, 2003 (the "Report")  fully  complies
with the requirements of Section 13(a) of the Securities Exchange
Act  of  1934 and that information contained in the Report fairly
presents,  in all material respects, the financial condition  and
results of operations of the Company.



/s/Peter L Vosotas
----------------------
Peter L. Vosotas
Chief Executive Officer
February 13, 2004

<PAGE> 31

Exhibit 32.2
        Written Statement of the Chief Financial Officer
                   Pursuant to 18 U.S.C.  1350

   Solely for the purposes of complying with 19 U.S.C.  1350, I ,
the  undersigned  Chief Financial Officer of Nicholas  Financial,
Inc. (the "Company"), hereby certify, based on my knowledge, that
the  Quarterly  Report  on Form 10-QSB of  the  Company  for  the
quarter  ended  December 31, 2003 (the "Report")  fully  complies
with the requirements of Section 13(a) of the Securities Exchange
Act  of  1934 and that information contained in the Report fairly
presents,  in all material respects, the financial condition  and
results of operations of the Company.


/s/Ralph Finkenbrink
------------------------
Ralph Finkenbrink
Chief Financial Officer
February 13, 2004