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 SEPTEMBER 30, 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 October 31st, 2003 there were 5,061,088 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 September 30, 2003...............................3

        Condensed Consolidated Statements of
        Income for  the  three and six months
        ended September 30, 2003 and 2002......................4

        Condensed Consolidated Statements of Cash Flows
        for the six months ended September 30, 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. Disclosures and Controls..............................23


Part II. Other Information

Item 1.  Legal Proceedings....................................24

Item 2.  Changes in Securities................................24

Item 3.  Defaults upon Senior Securities......................24

Item 4.  Submission of Matters to a Vote of
         Security Holders.....................................24

Item 5.  Other Information....................................24

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

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

         Certification........................................26
         Certification........................................27

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


<PAGE> 3

<TABLE>
<CAPTION>

Part I. Item 1
                     Nicholas Financial, Inc.
               Condensed Consolidated Balance Sheet
                             (Unaudited)

                                                   September 30,
                                                        2003
                                                 ----------------
<S>                                              <C>
Assets
Cash                                               $ 1,984,453
Finance receivables, net                            92,122,665
Accounts receivable                                     13,526
Prepaid expenses and other assets                      864,339
Property and equipment, net                            511,989
Deferred income taxes                                3,005,123
                                                   ------------
Total assets                                       $98,502,095
                                                   ============

Liabilities
Line of credit                                      $65,010,238
Drafts payable                                          521,974
Notes payable - related party                           991,530
Accounts payable                                      3,742,609
Dividends payable                                       253,354
Derivatives                                           1,932,077
Income taxes payable                                    735,007
Deferred revenues                                       999,732
                                                    ------------
Total liabilities                                    74,186,521

Shareholders' equity
Preferred stock, no par: 5,000,000 shares
authorized;none issued and outstanding                        -
Common stock, no par: 50,000,000 shares
authorized; 5,061,088 shares issued and
outstanding                                           4,570,041
Other comprehensive loss                             (1,202,718)
Retained earnings                                    20,948,251
                                                    ------------
                                                     24,315,574
                                                    ------------
Total liabilities and shareholders' equity          $98,502,095
                                                    ============

See accompanying notes.

</TABLE>

<PAGE> 4
<TABLE>
<CAPTION>
                     Nicholas Financial, Inc.
            Condensed Consolidated Statements of Income
                            (Unaudited)


                                   Three months ended        Six months ended
                                      September 30,            September 30,
                                  2003          2002         2003         2002
                                 --------------------------------------------------
<S>                         <C>            <C>           <C>          <C>
Revenue:
Interest income on
 finance receivables         $6,074,327    $5,492,139     $12,062,800  $10,725,488
Sales                            70,750        92,939         142,308      175,315
                             -----------------------------------------------------
                              6,145,077     5,585,078      12,205,108   10,900,803
Expenses:
Cost of sales                    11,615        25,652          28,689       42,820
Marketing                       220,591       155,860         431,823      309,341
Administrative                2,481,856     2,114,689       4,797,733    4,096,548
Provision for credit losses     404,156       582,138         984,155    1,129,204
Depreciation                     62,500        42,000         132,218       79,000
Interest expense                968,310       967,632       1,955,638    1,931,695
                              ----------------------------------------------------
                              4,149,028     3,887,971       8,330,256    7,588,608
Operating income before
 income taxes                 1,996,049     1,697,107       3,874,852    3,312,195

Income tax expense:
Current                         616,493       508,509       2,208,600    1,081,758
Deferred                        130,664       132,442        (748,615)     161,117
                              ----------------------------------------------------
                                747,157       640,951       1,459,985    1,242,875
                              ----------------------------------------------------
Net Income                   $1,248,892    $1,056,156      $2,414,867   $2,069,320
                             =====================================================
Earnings per share - basic        $0.25         $0.21           $0.48        $0.41
                             =====================================================
Earnings per share - diluted      $0.23         $0.20           $0.45        $0.39
                             =====================================================

See accompanying notes.

</TABLE>
<PAGE> 5

<TABLE>
<CAPTION>

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



                                       Six months ended September 30,
                                           2003             2002
                                    ----------------------------------
<S>                                 <C>                <C>
Operating activities
Net income                           $ 2,414,867        $  2,069,320
Adjustments to reconcile
 net income to net cash provided
  by operating activities:
Depreciation                             132,218              79,000
Provision for credit losses              984,155           1,129,204
Deferred income taxes                   (836,391)            161,117
Changes in operating assets
 and liabilities:
Accounts receivable                        2,702              (4,604)
Prepaid expenses and other assets       (227,066)           (323,055)
Accounts payable                         671,733            (291,170)
Drafts payable                          (142,546)           (121,320)
Income taxes payable                     629,132            (110,116)
Deferred revenues                         82,843             255,781
                                     ---------------------------------
Net cash provided by operating
 activities                            3,711,647           2,844,157

Investing activities
Purchase and origination of
 finance contracts                   (34,313,256)        (31,145,587)
Principal payments received           27,384,548          24,565,321
Purchase of property and
 equipment, net of disposals            (176,611)           (118,151)
                                     --------------------------------
Net cash used in investing
  activities                          (7,105,319)         (6,698,417)

Financing activities
Issuance of notes payable -
  related party                          182,920             107,094
Net proceeds from line of credit       4,850,000           4,260,000
Payment of dividend                     (253,354)                  -
Sale of common stock                     117,348              34,130
                                      -------------------------------
Net cash provided by
 financing activities                  4,896,914           4,401,224
                                      -------------------------------
Net increase in cash                   1,503,242             546,964

Cash, beginning of period                481,211              51,239
                                     --------------------------------
Cash, end of period                  $ 1,984,453          $  598,203
                                     ================================
See accompanying notes.

</TABLE>
<PAGE> 6

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

                       September 30, 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
the  six  months  ended September 30, 2003  are  not  necessarily
indicative  of  the  results that may be expected  for  the  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-K for the year
ended March 31, 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.

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:

<PAGE> 7


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


<TABLE>
<CAPTION>


3. Earnings Per Share (continued)



                                    Three months ended      Six months ended
                                       September 30,         September 30,
                                      2003       2002       2003        2002
                                 ------------------------------------------------
<S>                              <C>         <C>         <C>         <C>
Numerator:
 Numerator for basic
 earnings per share -
 Net income available
 to common stockholders           $1,248,892  $1,056,156  $2,414,867  $2,069,320

Denominator:
 Denominator for basic
 earnings per share -
 weighted average shares           5,038,318   5,010,351   5,022,622   5,004,909

 Effect of dilutive securities:
 Employee stock options              366,858     305,659     330,195     324,398
                                   ----------------------------------------------
 Denominator for diluted
 earnings per share -  adjusted
 weighted-average  shares and
 assumed conversions               5,405,176   5,316,010   5,352,817   5,329,307
                                   ==============================================
Earnings per share - basic             $0.25       $0.21       $0.48       $0.41
                                   ==============================================
Earnings per share - diluted           $0.23       $0.20       $0.45       $0.39
                                   ==============================================


</TABLE>

<PAGE> 8

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




4. Finance Receivables

The Company charges-off receivables when an individual account
has become more than 120 days contractually delinquent. In the
event of a repossession the charge-off will occur in the month in
which the vehicle was repossessed.

Costs associated with repossession, transport and auction
preparation expenses are charges reported under operating
expenses in the period in which they were incurred. The Company
maintains full responsibility for repossessions. There is no
relationship between the Company and the dealer with respect to a
given contract once the assignment of that contract is complete.
The dealer has no vested interest in the performance of any
installment contract the Company purchases.

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

  Finance receivables, gross contract        $146,989,453
    Less:
       Unearned interest                      (35,197,359)
                                            --------------
                                              111,792,094
       Dealer discounts                       (13,693,961)
       Allowance for credit losses             (5,975,468)
                                            --------------
       Finance receivables, net              $ 92,122,665
                                            ==============

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

5. Line of Credit

The  Company has a $75 million Line of Credit facility (the Line)
which  expires  on November 30, 2004. Borrowings under  the  Line
bear  interest  at the prime rate plus twenty-five basis  points.
The Company also has several LIBOR pricing options available.  If
the  outstanding balance falls below $10 million the  Line  bears
interest at the prime rate plus 2.00%. Pledged as collateral  for
this credit facility are all of the assets of Nicholas Financial,
Inc.  As  of  September 30, 2003 the outstanding  amount  of  the
credit  facility was $65,010,238, the amount available under  the
line  of  credit  was $9,989,762. As of September  30,  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 6.60% with principal and interest due within 30-days
upon demand. The notes totaled $991,530 at September 30, 2003.

<PAGE> 9


                     Nicholas Financial, Inc.
     Notes to the Condensed Consolidated Financial Statements
                            (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  September  30,  2003,
approximately $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 3.46% and 3.78% and paid an average fixed  rate
of  6.04%  and 6.77% during the three months ended September  30,
2003,  2002, respectively. Under the swap agreements, the Company
received an average variable rate of 3.49% and 3.99% and paid  an
average fixed rate of 6.19% and 6.85% during the six months ended
September  30,  2003, 2002, respectively. A  loss  of  $1,932,077
related to the fair value of the swaps at September 30, 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 disclosed  in  the  table
below.

<TABLE>
<CAPTION>

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



                                     Notional     Fixed Rate
 Date Entered     Effective Date     Amount       Of Interest   Maturity  Date
--------------------------------------------------------------------------------
<S>               <C>                <C>           <C>          <C>
 August 19, 1999   August 19, 1999   $10,000,000    5.80%       August 1, 2003
 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
                            (Unaudited)



8. Stock Options

In  December  2002,  the  Financial  Accounting  Standards  Board
("FASB")  issued  Statement  of  Financial  Accounting  Standards
(SFAS)      No.      148,     "Accounting     for     Stock-Based
Compensation-Transition  and  Disclosure"   which   amends   FASB
Statement  No.  123.   SFAS 148 provides alternative  methods  of
transition for a voluntary change to the fair value based  method
of  accounting  for stock-based-employee compensation.  SFAS  148
also  amends the disclosure requirements of SFAS 123  to  require
more   prominent  and  more  frequent  disclosures  in  financial
statements  concerning  the effects of stock-based  compensation.
The  effective date of SFAS 148 is for fiscal years ending  after
December 15, 2002.

The  Company has an employee stock incentive plan (the  SIP)  for
officers, directors and key employees under which 557,866  shares
of  common  stock were reserved for issuance as of September  30,
2003.  Options  currently granted by the Company  generally  vest
over a five-year period.

Previous  to SFAS 148 the Company had elected to follow  APB  25,
"Accounting   For   Stock   Based  Compensation"    and   related
Interpretations  in  accounting for its  employee  stock  options
because  the alternative, fair value method, provided  for  under
SFAS  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.

The  following table contains the pro forma net income and  basic
and fully diluted earnings per share under the fair value method.
The fair value method uses the Black-Scholes option-pricing model
to  determine compensation expense associated with the  Company's
options.

<TABLE>
<CAPTION>
                         Three months ended   Six months ended
                           September 30         September 30
                         2003         2002    2003        2002
                        ---------------------------------------
<S>                     <C>         <C>         <C>         <C>
Net Income               $1,248,892  $1,056,156  $2,414,867  $2,069,320
Basic earnings per share       $.25        $.21        $.48        $.41

Fully diluted earnings
  per share                    $.23        $.20        $.45        $.39
Stock based employee
 compensation cost under
 the Fair Value Method       $9,021     $20,103     $21,033     $44,312
Pro forma net income     $1,239,871  $1,036,053  $2,393,834  $2,025,008
Pro forma basic earnings
 per share                     $.25        $.21        $.48        $.40
Pro forma diluted earnings
 per share                     $.23        $.19        $.45        $.38

</TABLE>

<PAGE> 11

                    Nicholas Financial, Inc.
     Notes to the Condensed Consolidated Financial Statements
                           (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 six months ended September 30, 2003 and
2002, respectively.

<TABLE>
<CAPTION>
                        Three months ended       Six months ended
                           September 30            September 30
                         2003         2002      2003          2002
                     ------------------------------------------------
<S>                  <C>          <C>         <C>        <C>
Net Income            $1,248,892   $1,056,156  $2,414,867 $2,069,320

Mark to market
interest rate swaps      463,896     (407,715)    199,627   (654,587)
                     ------------------------------------------------
Comprehensive income  $1,712,788    $648,441  $2,614,494  $1,414,713
                     ================================================

</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  month  period
ended  September 30, 2003 to $1,248,892 from $1,056,156  for  the
three  month  period ended September 30, 2002.  Consolidated  net
income  increased  for the six month period ended  September  30,
2003 to $2,414,867 from $2,069,320 for the six month period ended
September  30,  2002.  Earnings were  favorably  impacted  by  an
increase   in  the  outstanding  loan  portfolio.  The  Company's
Nicholas  Data  Services  (NDS)  subsidiary  did  not  contribute
significantly  to  consolidated operations in the  three  or  six
month periods ended September 30, 2003 or 2002.


<TABLE>
<CAPTION>

                                          Portfolio Summary

                             Three months ended           Six months ended
                                September 30                 September 30
                              2003         2002           2003           2002
                         --------------------------------------------------------------
<S>                     <C>              <C>           <C>           <C>
Average Net
Finance Receivables(1)   111,195,574      97,378,535    109,204,020   95,579,869

Average Indebtedness(2)   64,162,081      57,165,923     63,200,691   56,373,558

Total Finance Revenue(3)   6,074,326       5,492,139     12,062,800   10,725,488

Interest Expense             968,310         967,632      1,955,638    1,931,695

Net Finance Revenue        5,106,016       4,524,507     10,107,162    8,793,793

Weighted average
Contractual rate(5)           23.55%          23.84%         23.55%       23.84%

Gross Portfolio Yield(4)      21.85%          22.56%         22.09%       22.44%

Average Cost of
 Borrowed Funds                6.04%           6.77%          6.19%        6.85%

Provision for Credit
Losses as a
Percentage of Average
Net Finance Receivables        1.45%           2.39%          1.80%        2.36%

Net Portfolio Yield (4)       16.91%          16.19%         16.71%       16.04%

Operating Expenses as a
Percentage of Average Net
Finance Receivables (6)        9.71%           9.21%          9.57%        9.07%

Pre-tax Yield as a
Percentage of Average
Net Finance Receivables(7)     7.21%           6.98%          7.14%        6.97%

Write-off to Liquidation(8)    9.89%           9.29%          8.85%        8.60%

Net Charge-Off Percentage(9)   8.58%           7.97%          7.63%        7.47%

See accompanying notes.

</TABLE>
<PAGE> 13


(1) Average net finance receivables represent the average of  net
    finance  receivables throughout the period.      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  the  Line  of Credit  and  notes  payable-
    related  party.   Average cost of borrowed  funds  represents
    interest expense as a percentage of average indebtedness.

(3) Does  not  include revenue of $70,750 and $92,939  associated
    with  the  Company's software subsidiary NDS  for  the  three
    months ended September 30, 2003 and 2002, respectively.  Does
    not  include revenue of $142,308 and $175,315 associated with
    the  Company's  software subsidiary NDS for  the  six  months
    ended September 30, 2003 and 2002, respectively.

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

(5) Weighted  average  contractual rate represents  the  weighted
    average annual percentage rate (APR) of all contracts in  the
    portfolio during the period.

(6)
    Does  not  include operating expenses of $66,585 and  $96,460
    associated  with  the Company's software subsidiary  NDS  for
    the   three  months  ended  September  30,  2003  and   2002,
    respectively.   Does  not  include  operating   expenses   of
    $136,066  and $193,166 associated with the Company's software
    subsidiary  NDS for the six months ended September  30,  2003
    and 2002, respectively.

(7) Pre-tax  yield represents net portfolio yield minus operating
    expenses as a percentage of interest earning      assets

(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  net finance receivables outstanding  during  the
    period.


<PAGE> 14


Three  months  ended September 30, 2003 compared  to  three  months
ended September 30, 2002


 Interest Income and Loan Portfolio

       Interest  revenue increased 11% to $6.1  million  for  the
period ended September 30, 2003, from $5.5 million for the period
ended  September  30,  2002. The net finance  receivable  balance
totaled $92.1 million at September 30, 2003, an increase  of  13%
from  the $81.5 million at September 30, 2002. The primary reason
net  finance  receivables  increased  was  the  increase  in  the
receivable  base of several existing branches and the opening  of
three  additional branch locations. The gross finance  receivable
balance  increased  13% to $147.0 million at September  30,  2003
from  $129.6  million at September 30, 2002. The  primary  reason
interest  revenue increased was the increase in  the  outstanding
loan  portfolio. The gross portfolio yield decreased from  22.56%
for  the period ended September 30, 2002 to 21.85% for the period
ended September 30, 2003. The net portfolio yield increased  from
16.19% for the period ended September 30, 2002 to 16.91% for  the
period  ended  September  30, 2003. The primary  reason  for  the
increase  in  the  net portfolio yield was  an  decrease  in  the
provision  for  credit losses for the period ended September  30,
2003.

 Computer Software Business

   Sales  for  the period ended September 30, 2003  were  $70,750
compared  to $92,939 for the period ended September 30,  2002,  a
decrease of 24%.  This decrease was primarily due to attrition in
the  customer base. The Cmpany expects this trend to continue  as
it  continues to focus on its core business of consumer  finance.
Cost of sales and operating expenses decreased from $105,682  for
the  period  ended September 30, 2002 to $78,200 for  the  period
ended September 30, 2003.

 Operating Expenses

   Operating expenses, excluding provision for credit losses  and
interest expense, increased to $2.8 million for the period  ended
September  30,  2003  from  $2.3 million  for  the  period  ended
September   30,   2002.  This  increase  of  19%  was   primarily
attributable  to  the  additional staffing  of  several  existing
branches, increased general operating expenses and the opening of
three  additional  branch  offices.  Operating  expenses   as   a
percentage  of interest earning assets increased from  9.21%  for
the period ended September 30, 2002 to 9.71% for the period ended
September 30, 2003.

 Interest Expense

      Interest expense increased to $968,310 for the period ended
September  30, 2003 as compared to $967,632 for the period  ended
September 30, 2002. The average indebtedness for the period ended
September 30, 2003 increased to $64.2 million compared  to  $57.2
million  for  the period ended September 30, 2002. This  increase
was  offset  by  a  decrease in the average cost  of  outstanding
borrowings from 6.77% during the three months ended September 30,
2002 to 6.04% during the three months ended September 30, 2003.


<PAGE> 15

Six  months  ended September 30, 2003 compared to six months  ended
September 30, 2002


 Interest Income and Loan Portfolio

       Interest  revenue increased 12% to $12.1 million  for  the
period  ended  September 30, 2003, from  $10.7  million  for  the
period  ended  September  30, 2002. The  net  finance  receivable
balance  totaled $92.1 million at September 30, 2003, an increase
of  13% from the $81.5 million at September 30, 2002. The primary
reason net finance receivables increased was the increase in  the
receivable  base of several existing branches and the opening  of
three  additional branch locations. The gross finance  receivable
balance  increased  13% to $147.0 million at September  30,  2003
from  $129.6  million at September 30, 2002. The  primary  reason
interest  revenue increased was the increase in  the  outstanding
loan  portfolio. The gross portfolio yield decreased from  22.44%
for  the period ended September 30, 2002 to 22.09% for the period
ended September 30, 2003. The net portfolio yield increased  from
16.04% for the period ended September 30, 2002 to 16.71% for  the
period  ended  September  30, 2003. The primary  reason  for  the
increase  in  the  net  portfolio yield was  a  decrease  in  the
provision  for  credit losses for the period ended September  30,
2003.

 Computer Software Business

   Sales  for  the period ended September 30, 2003 were  $142,308
compared to $175,315 for the period ended September 30,  2002,  a
decrease of 19%. This decrease was primarily due to attrition  in
the customer base. The Company expects this trend to continue  as
it  continues to focus on its core business of consumer  finance.
Cost of sales and operating expenses decreased from $193,166  for
the  period  ended September 30, 2002 to $164,755 for the  period
ended September 30, 2003.

 Operating Expenses

       Operating expenses, excluding provision for credit  losses
and  interest expense, increased to $5.4 million for  the  period
ended  September 30, 2003 from $4.5 million for the period  ended
September   30,   2002.  This  increase  of  19%  was   primarily
attributable  to  the  additional staffing  of  several  existing
branches, increased general operating expenses and the opening of
three  additional  branch  offices.  Operating  expenses   as   a
percentage  of interest earning assets increased from  9.07%  for
the period ended September 30, 2002 to 9.57% for the period ended
September 30, 2003.

 Interest Expense

       Interest expense increased to $2.0 million for the  period
ended  September  30, 2003 as compared to $1.9 million   for  the
period ended September 30, 2002. The average indebtedness for the
period  ended  September  30,  2003 increased  to  $63.2  million
compared  to  $56.4  million for the period ended  September  30,
2002. This increase was offset by a decrease in the average  cost
of  outstanding borrowings from 6.85% during the six months ended
September 30, 2002 to 6.19% during the six months ended September
30, 2003.


<PAGE> 16

Contract Procurement

The  Company purchases contracts in the states listed below.  The
amounts  shown in the table below represent the total face  value
of contracts acquired. The decrease in purchases for the State of
Florida is primarily due to increased competition and the lack of
expansion in that state during the current year. The Company  has
sixteen  branch  locations  in Florida  and  does  not  have  any
immediate plans for additional expansion in Florida. The  Company
has  been  expanding its contract procurement in North  Carolina,
South  Carolina, Ohio, Virginia and Michigan. 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  1999  vehicle.   Contracts
purchased and originated are shown at face value.


<TABLE>
<CAPTION>

         Maximum
         allowable
         Interest       3 Months Ended          6 Months Ended
 State    rate (1)    9/30/03    9/30/02      9/30/03      9/30/02
------------------------------------------------------------------
 <C>       <C>     <C>         <C>          <C>          <C>
  FL       30%      $9,077,354  $9,760,594   $19,125,752  $19,259,893
  OH       25%       3,109,399   2,131,955     6,214,025    3,678,333
  GA       29%       2,263,364   2,092,776     4,570,548    3,866,887
  NC       29%       1,998,984   1,957,783     3,969,578    3,955,127
  SC       29%         743,924     586,870     1,479,639    1,098,633
  MI       25%         612,723           -     1,068,257            -
  VA       29%         184,573       8,400       201,613       55,042
                  ----------------------------------------------------
                   $17,990,321 $16,538,378   $36,629,412  $31,913,915
                 =====================================================

</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            6 Months Ended
                      9/30/03       9/30/02     9/30/03      9/30/02
-----------------------------------------------------------------------
    <S>           <C>           <C>          <C>          <C>
Purchases          $17,990,321   $16,538,378  $36,629,412  $31,913,915
Weighted APR            24.00%        24.03%       23.96%       24.32%
Average Discount         8.95%         8.81%        8.95%        8.82%
Average Term(mths)          43            41           44           41
Average Loan            $8,082        $8,273       $8,138       $8,194
Number of Contracts      2,226         1,999        4,501        3,895

</TABLE>

<TABLE>
<CAPTION>

                             Direct Loans Originated
                       3 Months Ended        6 Months Ended
                    9/30/03     9/30/02    9/30/03     9/30/02
--------------------------------------------------------------------------
<S>                <C>        <C>        <C>         <C>
Originations        $961,073   $935,539  $1,893,856  $2,046,435
Weighted  APR         26.29%      26.08%     26.46%      25.82%
Average Term(mths)        28          21         27          22
Average Loan          $2,930      $3,057     $2,896      $3,134
Number of Loans          328         306        654         653

</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 71 Contracts
with  an  aggregate  initial principal  amount  of  approximately
$574,735.  As of September 30, 2003, the Company had  446  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,
Ohio,  Michigan and Virginia. 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  discount  represents the difference between  the  face
value  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 therefore 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
months  ended  September  30,  2003  were  $496,826  compared  to
$566,869  for the three months ended September 30, 2002. Reserves
accreted into income for the six months ended September 30,  2003
were  $1,020,951 compared to $1,147,920 for the six months  ended
September 30, 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. As of September 30, 2003, the Company
had  established reserves for losses on Contracts of  $19,468,081
or 13.65% of gross outstanding receivables under the Contracts.


<PAGE> 18


The following table sets forth a reconciliation of the changes in
dealer discount on Contracts.

<TABLE>
<CAPTION>

                       Three months ended       Six months ended
                         September 30,            September 30,
                          2003    2002            2003     2002
                  ------------------------------------------------------------
<S>                  <C>            <C>           <C>           <C>
Balance at
beginning of period   $13,358,345    $11,686,394   $12,394,089   $11,259,898

Discounts acquired
 on new volume          2,896,626      2,675,639     5,964,475     5,218,073
Losses absorbed        (2,391,406)    (2,148,048)   (4,247,938)   (3,937,298)
Recoveries                303,148        276,746       580,212       525,774
Reserves accreted        (472,752)      (538,609)     (996,877)   (1,114,325)
                     --------------------------------------------------------
Balance at
end of period         $13,693,961    $11,952,122   $13,693,961   $11,952,122
                     ========================================================
Reserves as a
percent of gross
Finance receivables         9.60%          9.58%         9.60%         9.58%
                     ========================================================

</TABLE>

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

<TABLE>
                       Three months ended       Six months ended
                         September 30,            September 30,
                       2003        2002          2003        2002
                   ------------------------------------------------
<S>                 <C>         <C>           <C>         <C>

Balance at
beginning of period        $5,736,120  $4,452,746  $5,428,681   $4,105,174

Current period provision      344,655     518,525     864,108    1,009,989
Losses absorbed              (306,656)    (91,898)   (518,670)    (235,791)
                          -------------------------------------------------
Balance at
end of period              $5,774,119  $4,879,373  $5,774,119   $4,879,372
                         ==================================================
Reserves as a
percent of gross
Finance receivables             4.05%       3.91%       4.05%        3.91%
                         ==================================================
</TABLE>


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

<TABLE>
<CAPTION>

                       Three months ended       Six months ended
                         September 30,     September 30,
                      2003    2002     2003     2002
                    ------------------------------------------------
<S>                   <C>        <C>        <C>         <C>
Balance at
beginning of period    $201,017   $226,747   $176,126    $200,612

Current period
provision                59,501     63,613    120,047     119,215
Losses absorbed         (42,488)   (67,851)   (83,739)    (98,448)
Recoveries                7,393      8,060     12,989      14,525
Reserves accreted       (24,074)   (28,260)   (24,074)    (33,595)
                       --------------------------------------------
Balance at end of
period                 $201,349   $202,309   $201,349    $202,309
                       ===========================================
Reserves as a
percent of gross
Finance receivables       4.59%      4.19%      4.59%       4.19%
                       ===========================================

</TABLE>


<TABLE>
<S>                 <C>         <C>         <C>          <C>
Total reserves
at end of period    $19,669,429 $17,033,804  $19,669,429 $17,033,804

Reserves as a
percent of gross
Finance receivables      13.38%      13.15%       13.38%      13.15%

</TABLE>

<PAGE> 19

The  average dealer discount associated with new volume increased
for  the  three and six months ended September 30, 2003 to  8.95%
and  8.95%  respectively, from 8.81% and 8.82% for the three  and
six  months  ended September 30, 2002, respectively. The  Company
does  not consider these changes to be material and such  changes
are  not  the  result  of  any change  in  buying  philosophy  or
competition.

The  provision for credit losses decreased for the three and six-
month  periods ended September 30, 2003 to $404,156 and  $984,155
respectively,  as  compared to $582,138 and  $1,129,204  for  the
three  and  six-month  periods ended  September  30,  2002.  This
reduction  is  primarily  attributed  to  an  increase   in   the
collections  of ancillary charges from existing customers.  To  a
lesser  extent,  the provision for credit losses decreased  as  a
result  of  static pool performance meeting or exceeding  Company
expectations.

The  Company's  losses  as a percentage of liquidation  increased
during the three and six months periods ended September 30,  2003
as  compared to last year. The three and six-month periods  ended
September  30, 2003 were 9.89% and 8.85% compared  to  9.29%  and
8.60%  for  the  three and six-month periods ended September  30,
2002.   The   Company  anticipates  portfolio  performance   will
deteriorate  in  the near term, but will stabilize  in  the  long
term,   unless  the  overall  economic  conditions  and   current
unemployment  rates continue to decline. In response  to  current
conditions  the  Company  has raised its initial  target  reserve
percentage  on new static pools to 12.2% 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 period ended September  30,  2003
decreased to 2.63% from 2.88% for the period ended September  30,
2002.  The  delinquency  percentage for direct  loans  more  than
thirty  days  past  due for the period ended September  30,  2003
increased to 2.99% from 2.08% for the period ended September  30,
2002.  The  Company  does not give significant  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 current period losses were  11.33%
and  12.23%  for the three and six-month periods ended  September
30,  2003 as compared to 12.34% and 12.65% for the three and six-
month  periods  ended  September 30, 2002.  The  Company  expects
recoveries  as a percent of losses to decline in the  future,  as
the Company continues to expand, it will become more difficult to
implement  the  loss recovery model in geographic  areas  further
away from the Company's origin.

Reserves accreted into income for the three and six-month periods
ended   September   30,   2003  were  $496,826   and   $1,020,951
respectively as compared to $566,869 and $1,147,920 for the three
and  six-month periods ended September 30, 2002. 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,   more
specifically;  static  pools more than fifty  percent  liquidated
have  seen an increase in the default rate when compared to prior
year  pool  performance during their same liquidation cycle.  The
Company  attributes  this  increase to overall  general  economic
conditions  and  more specifically to the increased  unemployment
rate in the Company's markets.

<PAGE> 20

      The  current  unemployment rate compared to last  year  has
risen.  The  Company believes there is a correlation between  the
unemployment rate and future portfolio performance.  The  Company
does  not anticipate the unemployment level to rise significantly
in  the future nor does it expect it to drop significantly in the
future,  therefore  the Company does not plan  on  increasing  or
decreasing reserves based on the current unemployment  rate.  The
number of voluntary repossessions has remained steady for the six
months  ended  September 30, 2003 as compared to the  six  months
ended  September  30,  2002. As a result of  this  stability  the
Company believes the current reserve levels are adequate in  this
regard. The number of bankruptcy filings has increased during the
six months ended September 30, 2003 as compared to the six months
ended September 30, 2002.

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> 21


   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>


                        Three Months Ended      Three Months Ended
                        September 30, 2003      September 30, 2002
                      ---------------------    --------------------

<S>                   <C>  <C>      <C>        <C>  <C>      <C>
Contracts
Gross Balance
 Outstanding                $142,611,322             $124,728,292

                          Dollar                  Dollar
Delinquencies             Amount   Percent*       Amount     Percent*
---------------       ------------ -------       ---------   ---------
30 to 59 days         $ 2,554,310   1.79%      $ 2,538,101     2.03%
60 to 89 days             921,969   0.65%          733,604     0.59%
90   +  days              269,734   0.19%          325,314     0.26%
                       -----------  -----      ------------   ------
Total Delinquencies   $ 3,746,013              $ 3,597,019

*Total Delinquencies
 as percent of
 outstanding balance                2.63%                      2.88%

Direct Loans
Gross Balance
Outstanding                  $ 4,378,131              $ 4,829,199

Delinquencies

30 to 59 days            $ 67,549   1.54%         $ 72,985     1.51%
60 to 89 days              15,716   0.36%           14,414     0.30%
90 + days                  47,737   1.09%           13,150     0.27%
                        ---------   -----         ---------    -----
Total Delinquencies      $131,002                 $100,549

*Total Delinquencies
 as a percent of
 outstanding balance                2.99%                      2.08%


</TABLE>

  The  delinquency percentage for contracts more than thirty days
past  due for the three months ended September 30, 2003 was 2.63%
compared to 2.88% for the three months ended September 30,  2002.
The delinquency percentage for direct loans more than thirty days
past  due for the three months ended September 30, 2003 was 2.99%
compared to 2.08% for the three months ended September 30, 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
estimates  future  portfolio performance by  considering  several
factors.  The most significant factors are described as  follows.
The  Company analyzes historical static pool performance for each
branch location when determining appropriate reserve levels.  The
Company  utilizes  internal branch audits  as  an  indication  to
future static pool performance. (See pg.7 of the Company's  March
31, 2003 10-KSB "Underwriting Guidelines" for more information on
branch location audits) The Company also considers such things as
the current unemployment rate in markets the Company operates in,
the  percentage of voluntary repossessions as compared  to  prior
periods,  the  percentage of bankruptcy filings  as  compared  to
prior periods and other leading economic indicators.

<PAGE> 22


Income Taxes

  The Company's effective tax rate remained relatively consistent
at  37.43%  and 37.68% for the three and six month periods  ended
September  30, 2003 compared to 37.77% and 37.52% for  the  three
and six months ended September 30, 2002.


Liquidity and Capital Resources

The  Company's cash flows for the six months ended September  30,
2003 and September 30, 2002 are summarized as follows:

<TABLE>
<CAPTION>
                                Six months ended   Six months ended
                                   September 30,     September 30,
                                       2003              2002
                              ---------------------------------------
 <S>                              <C>                 <C>
  Cash provided by:
   Operating Activities -          $ 3,711,647         $  2,844,157
   Investing Activities -
   (primarily purchase of
    Contracts)                      (7,105,319)          (6,698,417)
   Financing Activities              4,896,914            4,401,224

   Net increase in cash              1,503,242              546,964

</TABLE>

      The  Company's  primary use of working capital  during  the
three  months  ended September 30, 2003 was the  funding  of  the
purchase of Contracts.  The Contracts were financed substantially
through  borrowings on the Company's Line of Credit. The Line  of
Credit   is   secured  primarily  by  Contracts,  and   available
borrowings are based on a percentage of qualifying Contracts.  As
of September 30, 2003 the Company had approximately $10.0 million
available under the Line of Credit. 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 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  the  sale  of  additional
securities in the capital markets, will be sufficient to meet its
short term funding needs.

   The Company renewed its credit facility on June 28, 2002.  The
new  loan  agreement expires November 30, 2004 and bears interest
at  the  prime  rate plus .25% and offers several  LIBOR  pricing
options.  The  new  loan  agreement  released  Bank  One   as   a
participating bank and added First Tennessee Bank. The Company is
pleased with its new banking relationship and believes it will be
beneficial for future expansion.

  On August 11, 2003 the Company announced a $.10 per share semi-
annual cash dividend. The Company intends to continue the cash
dividend program, 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> 23

Future Expansion

       The   Company   currently  operates  twenty-eight   branch
locations, fifteen in the State of Florida, three in the State of
Georgia,  three in the State of North Carolina, one in the  state
of South Carolina, five in the state of Ohio and one in the state
of Michigan.

 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 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 opportunity for growth continues  to
exist in Florida, Georgia, North Carolina, South Carolina, Ohio,
and Michigan and intends to continue its expansion activities in
those  states. The Company is currently expanding its automobile
financing  program  in the State of Virginia.  The  Company  has
targeted  certain  geographic  locations  within  the  State  of
Virginia where it believes there is a sufficient market for  its
automobile   financing   program.  The  Company   is   currently
purchasing   Contracts  in  the  State  of  Virginia   utilizing
employees  who reside in the State of Virginia. These  employees
are  developing  their respective markets in  Virginia  and  the
Company  has  created a Central Buying Office in  its  Corporate
Headquarters  in  Clearwater Florida 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. The Company is also
analyzing other markets in States the Company does not currently
operate in, however no assurance can be given that any expansion
will occur in these new markets.

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.

Part I. Item 3
                    DISCLOSURES AND CONTROLS

(a)    Evaluation  of  disclosure 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 within 90 days of  the  filing
date  of  this report, the chief executive officer and the  chief
financial  officer  of the Company concluded that  the  Company's
disclosure controls and procedures were adequate.

(b)    Changes  in  internal  controls.   The  Company  made   no
significant changes in its internal controls or in other  factors
that could significantly affect these controls subsequent to  the
date  of  the evaluation of those controls by the chief executive
officer and chief financial officer.


<PAGE> 24

                   Part II - Other Information


Item 1.    Legal Proceedings - None

Item 2.    Changes in Securities - None

Item 3.    Defaults upon Senior Securities - None

Item 4.    Submission of Matters to a Vote of
           Security Holders - None

Item 5.    Other Information - None

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

           (b)  Reports on Form 8-K -


  On August 11, 2003, Nicholas Financial, Inc. (the "Company")
filed an 8-K announcing a cash dividend of $.10 payable semi-
annual to shareholders of record as of September 30, 2003.

  On September 30, 2003, the Company filed an 8-K announcing
Ernst & Young LLP had advised the Company's audit committee that,
following completion of its review of the Company's financial
statements as of, and for the quarter ended September 30, 2003,
it would resign as the Company's independent auditors.

  Ernst & Young's reports on Nicholas' 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 have
not been any disagreements between Nicholas 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.

  Nicholas has commenced the process of retaining new independent
auditors. That process is not yet complete.


<PAGE> 25
                           SIGNATURES

   In  accordance with the requirements of the Securities Act  of
1934, the Registrant certifies that it has reasonable grounds  to
believe that it meets all of the requirements for filing on  Form
10-QSB  and authorized this Report to be signed on its behalf  by
the undersigned, in the City of Clearwater, State of Florida,  on
November 13, 2003.


                    NICHOLAS FINANCIAL, INC.
                          (Registrant)


  Date: November 13, 2003       /s/Peter L Vosotas
                                ------------------------
                                Peter L. Vosotas
                                Chairman, President, Chief
                                Executive Officer
                                (Principal Executive Officer)


  Date: November 13, 2003       /s/Ralph T Finkenbrink
                                --------------------------
                                Ralph T. Finkenbrink
                                (Principal Financial Officer
                                 and Accounting Officer)


<PAGE> 26
                          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)  and  internal  control     over
       financial  reporting  (as defined  in  Exchange  Act Rules
       13a-15(f) and 15d-15(f) for the registrant and have:

          a)Designed  such disclosure controls and procedures, or
            caused such disclosure  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)Designed   such   internal   control  over  financial
            reporting,  or  caused  such  internal  control  over
            financial  reporting  to  be  designed  under     our
            supervision,    to  provide  reasonable     assurance
            regarding  the reliability of financial reporting and
            the  preparation of financial statements for external
            purposes  in  accordance  with  generally    accepted
            accounting principles;

          c)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

          d)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  officers  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 and material weaknesses
            in the design or  operation of internal controls 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  controls  over
            financial reporting.


 Date: November 13, 2003         /s/Peter L Vosotas
                                 -------------------------
                                 Peter L. Vosotas
                                 President &
                                 Chief Executive Officer

<PAGE> 27

                         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)  and  internal  control     over
       financial  reporting  (as defined  in  Exchange  Act Rules
       13a-15(f) and 15d-15(f) for the registrant and have:

          a)Designed  such disclosure controls and procedures, or
            caused such disclosure  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)Designed   such   internal   control  over  financial
            reporting,  or  caused  such  internal  control  over
            financial  reporting  to  be  designed  under     our
            supervision,    to  provide  reasonable     assurance
            regarding  the reliability of financial reporting and
            the  preparation of financial statements for external
            purposes  in  accordance  with  generally    accepted
            accounting principles;

          c)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

          d)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  officers  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 and material weaknesses
            in the design or  operation of internal controls 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  controls  over
            financial reporting.

Dated: November 13, 2003     /s/Ralph T Finkenbrink
                            -------------------------------
                            Ralph T. Finkenbrink
                            Senior Vice President


<PAGE> 28
                          EXHIBIT INDEX

Item 13. 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

<PAGE> 29

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

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)

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

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

<PAGE> 30

Exhibit 99.1


        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  September 30, 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
November 13, 2003


<PAGE> 31

Exhibit 99.2

        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  September 30, 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 T Finkenbrink
---------------------------
Ralph Finkenbrink
Chief Financial Officer
November 13, 2003