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, 2002



    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 31st, 2003 there were 5,002,021 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, 2002...............................3

         Condensed Consolidated Statements of Income
          for the three and nine months ended
          December 31, 2002 and 2001............................4

         Condensed Consolidated Statements of Cash
          Flows for the nine months ended
          December 31, 2002 and 2001............................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..............................22


Part II. Other Information

         Item 1. Legal Proceedings.............................23
         Item 2. Changes in Securities.........................23
         Item 3. Defaults upon Senior Securities...............23
         Item 4. Submission of Matters to a Vote of
                  Security Holders.............................23

Item 5.  Other Information.....................................23

Item 6.  Exhibits and Reports on Form 8-K......................23

         Signatures............................................24

         Exhibit Index.........................................27


<PAGE> 3

Part I. Item 1

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

<TABLE>
<CAPTION>
                                               December 31, 2002
                                              -------------------
<S>                                              <C>
Assets
Cash                                               $   738,841
Finance receivables, net                            81,747,124
Accounts receivable                                     19,542
Prepaid expenses and other assets                      867,332
Property and equipment, net                            406,818
Deferred income taxes                                1,321,300
                                                 --------------
Total assets                                       $85,100,957
                                                 ==============
Liabilities
Line of credit                                     $57,333,426
Drafts payable                                         309,724
Notes payable - related party                          654,376
Accounts payable                                     2,614,682
Derivatives                                          2,040,258
Income tax payable                                     991,754
Deferred revenues                                      949,958
                                                 --------------
Total liabilities                                   64,894,178

Shareholders' equity
Preferred stock, no par: 5,000,000 shares
 authorized; none issued and outstanding                     -
Common stock, no par: 50,000,000 shares
 authorized; 5,002,021 shares issued
 and outstanding                                     4,443,133
Other comprehensive loss                            (2,073,541)
Retained earnings                                   17,837,187
                                                 --------------
                                                    20,206,779
                                                 --------------
Total liabilities and shareholders' equity         $85,100,957
                                                 ==============

See accompanying notes.

</TABLE>

<PAGE> 4

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

<TABLE>
<CAPTION>
                                   Three months ended       Nine months ended
                                       December 31,            December 31,
                                    2002        2001         2002       2001
                                --------------------------------------------------
<S>                           <C>          <C>          <C>          <C>
Revenue:
Interest income on
 finance receivables           $5,350,248  $4,923,210    $16,075,736  $14,312,868
Sales                              78,850      85,852        254,165      274,894
                               --------------------------------------------------
                                5,429,098   5,009,062     16,329,901  14,587,762
Expenses:
Cost of sales                      19,865      15,932         62,685      59,494
Marketing                         172,388     134,724        481,729     383,196
Administrative                  2,012,342   1,846,227      6,108,890   5,328,805
Provision for credit losses       548,554     500,679      1,677,758   1,281,104
Depreciation and amortization      51,000      60,365        130,000     165,365
Interest expense                1,023,976     949,068      2,955,671   2,955,481
                               --------------------------------------------------
                                3,828,125   3,506,995     11,416,733  10,173,445
                               --------------------------------------------------
Operating income before
 income taxes                   1,600,973   1,502,067      4,913,168   4,414,317

Income tax expense:
 Current                        1,585,769     392,265      2,667,527   1,403,411
 Deferred                        (993,962)    161,269       (832,845)    250,852
                               --------------------------------------------------
                                  591,807     553,534      1,834,682   1,654,263
                               --------------------------------------------------
Net Income                     $1,009,166    $948,533     $3,078,486  $2,760,054
                               ==================================================

Earnings per share - basic          $0.20       $0.19          $0.62       $0.57
                               ==================================================
Earnings per share - diluted        $0.19       $0.18          $0.58       $0.53
                               ==================================================


See accompanying notes.

</TABLE>

<PAGE> 5
                    Nicholas Financial, Inc.
          Condensed Consolidated Statements of Cash Flows
                            (Unaudited)

<TABLE>
<CAPTION>

                                           Nine months ended December 31,
                                              2002               2001
                                        ---------------------------------------
<S>                                      <C>               <C>
Operating activities
Net income                                $ 3,078,486       $ 2,760,054
Adjustments to reconcile net income
 to net cash provided by operating
 activities:
Depreciation                                  130,000           165,365
Provision for credit losses                 1,677,758         1,281,104
Deferred income taxes                        (832,845)          250,852
Changes in operating assets and
 liabilities:
Accounts receivable                            (5,098)            1,321
Prepaid expenses and other assets            (350,677)         (102,686)
Accounts payable                             (805,737)         (275,795)
Drafts payable                               (109,392)                -
Principal payments received                35,754,549        31,196,298
Income taxes payable                          921,902           (93,819)
Deferred revenues                             294,402            74,076
                                          ------------------------------
Net cash provided by operating
 activities                                39,753,348        35,256,770

Investing activities
Purchase of finance contracts             (43,112,044)      (38,216,607)
Purchase of property and equipment,
 net of disposals                            (165,969)         (116,262)
                                          ------------------------------
Net cash used in investing activities     (43,278,013)      (38,332,869)

Financing activities
Issuance of notes payable - related party     112,094           223,274
Net Proceeds from line of credit            4,060,000         2,850,000
Sale of common stock                           40,173            72,733
                                          ------------------------------
Net cash provided by financing activities   4,212,267         3,146,007
                                          ------------------------------
Net increase in cash                          687,602            69,908

Cash, beginning of period                      51,239           233,167
                                          ------------------------------
Cash, end of period                       $   738,841       $   303,075
                                          ==============================

See accompanying notes.

</TABLE>

<PAGE> 6

                     Nicholas Financial, Inc.
     Notes to the Condensed Consolidated Financial Statements
                           (Unaudited)
                        December 31, 2002


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  nine  months  ended December 31, 2002  are  not  necessarily
indicative  of  the  results that may be expected  for  the  year
ending  March  31, 2003. 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, 2002.

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 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.

<PAGE> 7

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


3. Earnings Per Share

<TABLE>
<CAPTION>

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:


                                    Three months ended     Nine months ended
                                       December 31,           December 31,
                                     2002        2001       2002        2001
                                 -----------------------------------------------
<S>                              <C>         <C>        <C>         <C>
Numerator:
 Numerator for basic earnings per
  share - Net income available to
  common stockholders             $1,009,166  $ 948,533  $3,078,486  $2,760,054
 Effect of dilutive securities:
    Convertible debt                       -          -           -      17,491
                                  ---------------------------------------------
 Numerator for dilutive earnings
  per share - income available to
  common stockholders after
  assumed conversions             $1,009,166   $948,533  $3,078,486  $2,777,545
                                  =============================================

Denominator:
 Denominator for basic earnings
  per share - weighted average
  shares                           5,003,592  4,980,860   5,004,470   4,831,586

 Effect of dilutive securities:
  Employee stock options             274,025    294,768     307,607     290,794
  Convertible debt                         -          -           -     135,910
                                   --------------------------------------------
 Denominator for diluted earnings
  per share - adjusted weighted-
  average shares and
  assumed conversions              5,277,617  5,275,628   5,312,077   5,258,290
                                   ============================================
Earnings per share - basic             $0.20      $0.19       $0.62       $0.57
                                   ============================================
Earnings per share - diluted           $0.19      $0.18       $0.58       $0.53
                                   ============================================

</TABLE>

<PAGE> 8


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


4. Finance Receivables

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

<TABLE>
  <S>                                      <C>
   Finance receivables, gross contract      $128,992,200
    Less:
       Unearned interest                     (30,455,591)
                                           --------------
                                              98,536,609
       Dealer discount                       (12,110,424)
       Allowance for credit losses            (4,679,061)
                                           --------------
       Finance receivables, net             $ 81,747,124
                                           ==============
</TABLE>

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 .25%. 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.  and
its subsidiaries.


6. Notes Payable - Related Party

The Company's notes payable consist of unsecured notes bearing
interest at 9.5% with principal and interest due within 30-days
upon demand. The notes totaled $654,376 at December 31, 2002 and
are held by a related party.

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


7. Derivatives and Hedging

In  June  1998, the Financial Accounting Standards Board ("FASB")
issued  Statement of Financial Accounting Standards ("SFAS")  No.
133,   "Accounting   for  Derivative  Instruments   and   Hedging
Activities" ("SFAS 133"). This statement establishes requirements
for  accounting  and  reporting  of  derivative  instruments  and
hedging activities. SFAS 133 was updated by the issuance of  SFAS
No.  137,  "Accounting  for Derivative  Instruments  and  Hedging
Activities - Deferral of the Effective Date of SFAS No. 133"  and
SFAS  No. 138 "Accounting for Certain Derivative Instruments  and
Certain  Hedging  Activities - amendment of  FASB  Statement  No.
133."   As amended, SFAS 133 established accounting and reporting
standards   for   derivative   instruments,   including   certain
derivative  instruments embedded in other contracts (collectively
referred to as derivatives), and for hedging activities.

The  Company  adopted the provisions of SFAS 133, as  amended  by
SFAS 137 and SFAS 138, on April 1, 2001, which requires that  all
derivative instruments be recorded on the balance sheet  at  fair
value.   The   estimated  fair  value  of  derivative   financial
instruments represents the amount required to enter into  similar
offsetting contracts with similar remaining maturities  based  on
quoted market prices.

The  Company utilizes 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. When entering into contracts intended by the
Company  to  receive  hedge  accounting  treatment,  the  Company
formally designates and documents the financial instrument  as  a
hedge  of  a  specific underlying exposure, as well as  the  risk
management  objectives and strategies for undertaking  the  hedge
transaction.

<TABLE>
<CAPTION>

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


                                       Fixed
            Date          Notional    Rate Of
           Entered         Amount     Interest  Maturity Date
        ----------------------------------------------------
      <S>              <C>             <C>     <C>
       August 19, 1999  $10,000,000     5.80%   August 1, 2003
       May 17, 2000      10,000,000     6.87%   May 17, 2004
       March 30, 2001    10,000,000     4.89%   April 2, 2003
       October 5, 2001   10,000,000     3.85%   October 5, 2004
       June 28, 2002     10,000,000     3.83%   July 2, 2005

</TABLE>


<PAGE> 10

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


7. Derivatives and Hedging (cont.)

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

For  cash-flow hedge transactions, changes in the fair  value  of
the  derivative instrument are recorded as a component  of  other
comprehensive income, and reclassified into earnings in the  same
period  or  periods  during which earnings are  affected  by  the
variability of the cash flows of the hedged item. Any ineffective
portion  of  a  derivative instrument's change in fair  value  is
immediately recognized in earnings.

8. Stock Options

In  December  2003,  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 604,810  shares
of  common  stock were reserved for issuance as of  December  31,
2002.  Options  currently granted by the Company  generally  vest
over a five-year period.

Previous to FAS 148 the Company had elected to follow APB 25, and
related  Interpretations in accounting  for  its  employee  stock
options because the alternative, fair value method, provided  for
under  FAS 123 requires use of option valuation models that  were
not  developed  for use in valuing employee stock options.  Under
APB  25,  if  the exercise price of the Company's employee  stock
options  equals the market price of the underlying stock  on  the
date of grant, no compensation expense is recognized.


<PAGE> 11

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


8. Compensation Based Stock Options (cont.)

The following table contains 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    Nine Months Ended
                                December 31,        December 31,
                              2002       2001      2002        2001
                          ----------------------------------------------
<S>                       <C>        <C>       <C>         <C>
Net income                $1,009,166  $948,533  $3,078,486  $2,760,054

Basic earnings per share       $0.20     $0.19       $0.62       $0.57

Fully diluted earnings
 per share                     $0.19     $0.18       $0.58       $0.53

Stock based employee
 compensation cost under
 the Intrinsic Value Method        -         -           -           -

Stock based employee
 compensation cost under
 the Fair Value Method        15,282    23,729      59,594      77,801

Pro forma net income         993,884   924,804   3,018,892   2,682,253

Pro forma basic earnings
  per share                    $0.20     $0.19       $0.60       $0.56

Pro forma fully diluted
  earnings per share           $0.19     $0.18       $0.57       $0.51

</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 December 31, 2002 to $1,009,166 from $948,533 for the three
month  period  ended December 31, 2001. Earnings  were  favorably
impacted  by  an increase in the outstanding loan portfolio.  The
Company's  Nicholas Data Services subsidiary did  not  contribute
significantly  to consolidated operations in the  three  or  nine
month periods ended December 31, 2002 or 2001.

<TABLE>
<CAPTION>

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

                           Three  months ended       Nine  months ended
                                December 31,            December 31,
                             2002        2001         2002          2001
                         ---------------------------------------------------
<S>                      <C>          <C>         <C>          <C>
Average Net Finance
 Receivables (1)         $98,504,403  $84,882,208  $96,554,714  $82,919,199

Average Indebtedness(2)   57,952,802   50,611,434   56,899,973   50,271,434

Total Finance Revenue(3)   5,350,248    4,923,210   16,075,736   14,312,868

Interest Expense           1,023,976      949,068    2,955,671    2,955,481
                         ---------------------------------------------------
Net Finance Revenue        4,326,272    3,974,142   13,120,065   11,357,387

Weighted average
 contractual rate(5)          23.73%       23.96%       23.85%       24.04%

Gross Portfolio Yield(4)      21.73%       23.20%       22.20%       23.01%

Average Cost of
 Borrowed Funds(2)             7.07%        7.50%        6.93%        7.84%

Provision for Credit
 Losses as a Percentage
 of Average Net Finance
 Receivables                   2.23%        2.36%        2.32%        2.06%

Net Portfolio Yield(4)        15.34%       16.37%       15.80%       16.20%

Operating Expenses as
 a Percentage of
 Average Net Finance
 Receivables(6)                8.69%        9.15%        8.88%        8.96%


Pre-tax Yield as a
 Percentage of
 Average Net Finance
 Receivables(7)                6.65%        7.22%        6.92%        7.24%

Write-off to
 Liquidation(8)               11.97%       10.06%        9.88%        8.97%

Net Charge-Off
 Percentage(9)                10.50%        9.10%        8.62%        7.92%

</TABLE>

See accompanying notes.

<PAGE> 13



(1) Average  net  finance receivables represents 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 generated by the Company's software
    subsidiary  "NDS". See page 14 for detail on NDS revenue  for
    the   three   months  ended  December  31,  2002  and   2001,
    respectively. See page 15 for detail on NDS revenue  for  the
    nine months ended December 31, 2002 and 2001, 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  associated  with  the
    Company's  software subsidiary "NDS". See page 13 for  detail
    on  NDS  cost of sales and operating expenses for  the  three
    months  ended  December 31, 2002 and 2001, respectively.  See
    page  15  for  detail  on  NDS cost of  sales  and  operating
    expenses  for  the nine months ended December  31,  2002  and
    2001, 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 December 31, 2002 compared to three months ended
December 31, 2001


 Interest Income and Loan Portfolio

       Interest  revenue  increased 9% to $5.4  million  for  the
period  ended December 31, 2002, from $4.9 million for the period
ended  December  31,  2001.  The net finance  receivable  balance
totaled  $81.7 million at December 31, 2002, an increase  of  15%
from  the $70.8 million at December 31, 2001. The primary  reason
net  finance  receivables  increased  was  the  increase  in  the
receivable  base of several existing branches and the opening  of
six  additional  branch locations. The gross  finance  receivable
balance  increased 15% to $129 million at December 31, 2002  from
$112  million  at December 31, 2001. The primary reason  interest
revenue  increased  was  the increase  in  the  outstanding  loan
portfolio.  The gross portfolio yield decreased from  23.20%  for
the period ended December 31, 2001 to 21.73% for the period ended
December 31, 2002. The net portfolio yield decreased from  16.37%
for  the period ended December 31, 2001 to 15.34% for the  period
ended  December 31, 2002. The primary reason for the decrease  in
the  net  portfolio yield was an increase in charge-offs for  the
period ended December 31, 2002. The net charge off percentage for
the  period ended December 31, 2002 was 10.50% compared to  9.10%
for the period ended December 31, 2001.

 Computer Software Business

   Sales  for  the  period ended December 31, 2002  were  $78,850
compared  to  $85,852 for the period ended December 31,  2001,  a
decrease  of  8%. Cost of sales and operating expenses  decreased
from  $115,473 for the period ended December 31, 2001 to $115,073
for the period ended December 31, 2002.

 Operating Expenses

       Operating expenses, excluding provision for credit  losses
and  interest expense, increased to $2.3 million for  the  period
ended  December 31, 2002 from $2.1 million for the  period  ended
December   31,   2001.  This  increase  of  10%   was   primarily
attributable  to  the  additional staffing  of  several  existing
branches, increased general operating expenses and the opening of
six additional branch offices. Operating expenses as a percentage
of  interest earning assets decreased from 9.15% for  the  period
ended  December  31, 2001 to 8.69% for the period ended  December
31, 2002.

 Interest Expense

       Interest  expense increased to $1,023,976 for  the  period
ended  December 31, 2002 as compared to $949,068 for  the  period
ended  December 31, 2001. The average indebtedness for the period
ended  December 31, 2002 increased to $58.0 million  compared  to
$50.6  million  for  the  period ended December  31,  2001.  This
increase  was  offset  by  a decrease  in  the  average  cost  of
outstanding  borrowings from 7.50% during the three months  ended
December 31, 2001 to 7.07% during the three months ended December
31, 2002.


<PAGE> 15


Nine  months ended December 31, 2002 compared to nine months  ended
December 31, 2001


 Interest Income and Loan Portfolio

       Interest  revenue increased 12% to $16.1 million  for  the
period ended December 31, 2002, from $14.3 million for the period
ended  December  31,  2001.  The net finance  receivable  balance
totaled  $81.7 million at December 31, 2002, an increase  of  15%
from  the $70.8 million at December 31, 2001. The primary  reason
net  finance  receivables  increased  was  the  increase  in  the
receivable  base of several existing branches and the opening  of
six  additional  branch locations. The gross  finance  receivable
balance  increased 15% to $129 million at December 31, 2002  from
$112  million  at December 31, 2001. The primary reason  interest
revenue  increased  was  the increase  in  the  outstanding  loan
portfolio.  The gross portfolio yield decreased from  23.01%  for
the period ended December 31, 2001 to 22.20% for the period ended
December 31, 2002. The net portfolio yield decreased from  16.20%
for  the period ended December 31, 2001 to 15.80% for the  period
ended  December 31, 2002. The primary reason for the decrease  in
the  net  portfolio yield was an increase in charge-offs for  the
period ended December 31, 2002. The net charge off percentage for
the  period ended December 31, 2002 was 8.62% compared  to  7.92%
for the period ended December 31, 2001.

 Computer Software Business

   Sales  for  the period ended December 31, 2002  were  $254,165
compared  to $274,894 for the period ended December 31,  2001,  a
decrease  of  7.5%.  This  decrease was primarily  due  to  lower
revenue  from the existing customer base during the first quarter
of  the  fiscal  year.  Cost  of  sales  and  operating  expenses
decreased from $363,083 for the period ended December 31, 2001 to
$351,059 for the period ended December 31, 2002.

 Operating Expenses

       Operating expenses, excluding provision for credit  losses
and  interest expense, increased to $6.8 million for  the  period
ended  December 31, 2002 from $5.9 million for the  period  ended
December   31,   2001.  This  increase  of  14%   was   primarily
attributable  to  the  additional staffing  of  several  existing
branches, increased general operating expenses and the opening of
six additional branch offices. Operating expenses as a percentage
of  interest earning assets increased from 8.96% for  the  period
ended  December  31, 2001 to 8.88% for the period ended  December
31, 2002.

 Interest Expense

       Interest  expense was $3.0 million for  the  period  ended
December  31,  2002 as compared to $3.0 million  for  the  period
ended  December 31, 2001. The average indebtedness for the period
ended  December 31, 2002 increased to $56.9 million  compared  to
$50.3  million  for  the  period ended December  31,  2001.  This
increase  was  offset  by  a decrease  in  the  average  cost  of
outstanding  borrowings from 7.84% during the nine  months  ended
December  31, 2001 to 6.93% during the nine months ended December
31, 2002.

<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 and Ohio. 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.   Contracts
purchased and originated are shown at face value.


<TABLE>
<CAPTION>
             Maximum
            allowable
             Interest       3 Months Ended          9 Months Ended
    State     rate (1)   12/31/02    12/31/01    12/31/02     12/31/01
 -----------------------------------------------------------------------
    <C>      <C>      <C>         <C>         <C>          <C>
     FL       30%      $7,667,048  $8,920,202  $26,790,694  $27,935,330
     GA       29%       1,844,048   1,426,241    5,679,668    5,391,992
     NC       29%       1,755,160   1,666,170    5,694,837    4,715,598
     SC       29%         568,994     411,725    1,667,627      454,779
     OH       25%       1,714,623     315,452    5,373,214      315,452
     VA       29%          10,432     194,880       65,475      210,943
                      --------------------------------------------------
     Total            $13,560,305 $12,934,670  $45,271,515  $39,024,094
                      ==================================================

      (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>

<TABLE>
<CAPTION>
                         Indirect Contracts Purchased
                        ------------------------------
                     3 Months Ended            9 Months Ended
                  12/31/02    12/31/01     12/31/02      12/31/01
              ------------------------------------------------------
<S>           <C>          <C>           <C>          <C>
Purchases      $13,560,305  $12,934,670   $45,271,515  $39,024,094
Weighted APR        23.66%       24.38%        24.11%       24.45%
Average Discount     9.00%        8.79%         8.87%        8.48%
Average
 Term(mnths)            40           41            41           42
Average Loan        $8,091       $8,161        $8,157       $8,284
Number of
 Contracts           1,676        1,585         5,550        4,711



                           Direct Loans Originated
                         ----------------------------
                     3 Months Ended            9 Months Ended
                 12/31/02     12/31/01     12/31/02      12/31/01
              --------------------------------------------------------
Originations     $935,909    $1,356,272    $2,982,344   $3,118,883
Weighted APR       26.60%        25.62%        26.07%       25.97%
Average
 Term(mnths)           20            22            21           23
Average Loan       $2,713        $3,229        $2,988       $3,125
Number of
 Loans                345           420           998          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 70 Contracts
with  an  aggregate  initial principal  amount  of  approximately
$567,000.  As  of December 31, 2002, the Company had  409  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  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.

   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. Reserves  accreted
into  income for the period ended December 31, 2002 were $301,326
compared  to  $604,321  in the period ended  December  31,  2001.
Reserves  accreted into income for the nine months ended December
31,  2002  was $1,415,651 compared to $1,702,938 for  the  period
ended December 31, 2001.

   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

<TABLE>
<CAPTION>

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

                                 Three months ended         Nine months ended
                                    December 31,              December 31,
                                 2002         2001         2002           2001
                            ------------------------------------------------------
<S>                        <C>           <C>           <C>           <C>
Balance at beginning
 of period                  $11,952,122   $10,755,104   $11,259,898   $10,306,699
Discounts acquired on
 new volume                   2,160,225     2,120,253     7,378,298     6,466,272
Losses absorbed              (1,980,599)   (1,908,906)   (5,917,291)   (5,113,954)
Recoveries                      280,002       211,891       805,170       617,942
Reserves accreted              (301,326)     (604,321)   (1,415,651)   (1,702,938)
                            ------------------------------------------------------
Balance at end
 of period                  $12,110,424   $10,574,021   $12,110,424   $10,574,021
                            ======================================================
Reserve as a percent
 of gross finance
 receivables                      9.39%         9.45%         9.39%         9.45%
                            ======================================================

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

                                Three months ended          Nine months ended
                                    December 31,               December 31,
                                 2002         2001           2002         2001
                             ------------------------------------------------------

Balance at beginning
 of period                   $5,081,682    $3,941,970    $4,305,786    $3,465,015
Current period provision        548,554       500,679     1,677,758     1,281,104
Losses absorbed                (923,333)     (264,870)   (1,258,177)     (541,778)
Recoveries                        8,921         3,782        24,052        10,133
Reserves accreted               (36,763)      (29,726)      (70,358)      (62,639)
                             -----------------------------------------------------
Balance at end
 of period                   $4,679,061    $4,151,835    $4,679,061    $4,151,835
                             =====================================================
Reserve as a percent
 of gross finance
 receivables                      3.63%         3.71%         3.63%         3.71%
                             =====================================================


Total reserves at
 end of period              $16,789,485   $14,725,856   $16,789,485   $14,725,856
                            ======================================================

Reserves as a percent
 of gross finance
 receivables                     13.02%        13.16%        13.02%        13.16%
                            ======================================================

</TABLE>

The  average dealer discount associated with new volume increased
for  the  three and nine months ended December 31, 2002 to  9.00%
and  8.87%  respectively, from 8.81% and 8.48% for the three  and
nine  months  ended December 31, 2001, 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 increased for the three and nine-
month  periods ended December 31, 2002 to $548,354 and  1,677,758
respectively,  as  compared to $500,679 and  $1,281,104  for  the
three  and  nine-month  periods ended  December  31,  2001.  This
increase  is  primarily  attributed to an  increase  in  the  Net
Finance  Receivable balance from $70.8 million  at  December  31,
2001  to  $81.7 million at December 31, 2002. To a lesser extent,
the  provision for credit losses increased as a result of certain
static  pools reaching reserve levels below Company estimates  to
absorb  future  credit  losses. In these instances,  the  Company
increased  reserves related to specific static  pools  through  a
direct charge to income through the provision.


<PAGE> 19

The  Company's  losses  as a percentage of liquidation  increased
from  10.06% and 8.97% for the three and nine-month periods ended
December  31,  2001 to 11.97% and 9.88% for the three  and  nine-
month  periods  ended December 31, 2002. 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 12.2% 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 December 31, 2002
decreased  to 3.07% from 3.55% for the period ended December  31,
2001.  The  delinquency  percentage for direct  loans  more  than
thirty  days  past  due for the period ended  December  31,  2002
increased  to 2.52% from 2.03% for the period ended December  31,
2001.  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  10.00%
and  11.56%  for the three and nine-month periods ended  December
31,  2002 as compared to 9.92% and 11.11% for the three and nine-
month  periods ended December 31, 2001. 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, 2002 were $338,089  and  $1,486,009
respectively as compared to $634,047 and $1,765,577 for the three
and  nine-month periods ended December 31, 2001. 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

<TABLE>
<CAPTION>

   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:


                           Period Ended               Period Ended
                        December 31, 2002           December 31, 2001
                      --------------------        --------------------
<S>                  <C>    <C>   <C>         <C>     <C>     <C>
Contracts
Gross Balance
 Outstanding                 $124,238,870               $107,053,507

                       Dollar                      Dollar
Delinquencies          Amount    Percent*          Amount     Percent*
                     --------------------       ---------------------
30 to 59 days       $ 2,595,883    2.09%        $ 2,486,640     2.32%
60 to 89 days           852,351    0.69%            940,610     0.88%
90   +  days            363,195    0.29%            370,151     0.35%
                     -------------------        ---------------------
Total Delinquencies $ 3,811,429                 $ 3,797,401

*Total Delinquencies
 as percent of
 outstanding balance               3.07%                        3.55%

Direct Loans
Gross Balance
 Outstanding                  $ 4,753,330                $ 4,831,355

Delinquencies

30 to 59 days         $  52,074    1.10%           $ 49,542     1.03%
60 to 89 days            46,896    0.99%             28,770     0.60%
90 + days                20,869    0.43%             19,521     0.40%
                      -------------------          -------------------
Total Delinquencies   $ 119,839                    $ 97,833

*Total Delinquencies
 as a percent of
 outstanding balance               2.52%                        2.03%

</TABLE>


The  delinquency percentage for contracts more than  thirty  days
past  due  for  the period ended December 31, 2002  decreased  to
3.07%  from  3.55% for the period ended December  31,  2001.  The
delinquency  percentage for direct loans more  than  thirty  days
past  due  for  the period ended December 31, 2002  increased  to
2.52% from 2.03% for the period ended December 31, 2001.

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  36.97% and 37.34% for the three and nine month periods  ended
December 31, 2002 compared to 36.85% and 37.34% for the three and
nine months ended December 31, 2001.

<PAGE> 21




Liquidity and Capital Resources

The  Company's cash flows for the nine months ended December  31,
2002 and December 31, 2001 are summarized as follows:

<TABLE>
<CAPTION>
                             Nine months ended     Nine months ended
                             December 31, 2002     December 31, 2001
                            -------------------   -------------------
<S>                            <C>                   <C>
  Cash provided by(used in):
     Operating Activities-      $39,753,348           $35,256,770
     Investing Activities -
     (purchase of Contracts)    (43,278,013)          (38,332,869)
     Financing Activities         4,212,267             3,146,007

     Net increase in cash           687,602                69,908

</TABLE>


      The  Company's  primary use of working capital  during  the
three  months  ended  December 31, 2002 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  December 31, 2002 the Company had approximately $17.7 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.

<PAGE> 22

Future Expansion

       The   Company   currently  operates  twenty-eight   branch
locations, sixteen 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 and five in the state of Ohio.  Each office is
budgeted  (size of branch, number of employees and  location)  to
handle  up  to 1,000 accounts and up to $7,500,000 in outstanding
receivables.  To  date  two  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 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 also intends to continue its policy of  not  paying
dividends  and  using  earnings  from  operations  to   purchase
Contracts  or  make direct consumer loans. The Company  believes
opportunity  for  growth continues to exist  in  Georgia,  North
Carolina,  South Carolina and Ohio and intends to  continue  its
expansion  activities in those states. The Company has  expanded
its automobile financing program in the State of Ohio to include
5  branch locations and will continue to pursue seeking  markets
in Ohio for further expansion. The Company is currently pursuing
purchasing Contracts in the State of Michigan and South Carolina
utilizing  employees  who reside in those States,  respectively.
These employees are developing their respective markets 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.

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> 23

                   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 -  None


<PAGE> 24


                           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
February 14, 2003.


                    NICHOLAS FINANCIAL, INC.
                          (Registrant)


  Date: February 14, 2003       /s/Peter L. Vosotas
                                ------------------------------
                                Peter L. Vosotas
                                Chairman, President,
                                Chief Executive Officer
                                (Principal Executive Officer)



  Date: February 14, 2003       /s/Ralph T. Finkenbrink
                                ------------------------------
                                Ralph T. Finkenbrink
                                (Principal Accounting Officer)


<PAGE> 25
                          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 quarterly 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 quarterly
       report;

     3.Based on my knowledge, the financial statements, and other
       financial information included in this quarterly 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 quarterly 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-14 and 15d-14) for the
       registrant and have:

          a)designed such disclosure controls and procedures 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
            quarterly report is being prepared;

          b)evaluated the effectiveness of the registrant's disclosure
            controls and procedures as of a date within 90 days prior to the
            filing date of this quarterly report (the "Evaluation Date"); and

          c)presented in this quarterly report our conclusions about the
            effectiveness of the disclosure controls and procedures based on
            our evaluation as of the Evaluation Date;

     5.The registrant's other certifying officers and I have disclosed,
       based on our most recent evaluation, 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
            controls which could adversely affect the registrant's ability to
            record, process, summarize and report financial data and have
            identified for the registrant's auditors any material weaknesses
            in internal controls; 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;

     6.The registrant's other certifying officers and I have indicated in
       this quarterly report whether there were significant changes in
       internal controls or in other factors that could significantly
       affect internal controls subsequent to the date or our most
       recent evaluation, including any corrective actions with regard
       to significant deficiencies and material weaknesses.


Date: February 14, 2003            /s/Peter L. Vosotas
                                   --------------------------
                                   Peter L. Vosotas
                                   Principal Executive Officer

<PAGE> 26
                          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 quarterly 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 quarterly
       report;

     3.Based on my knowledge, the financial statements, and other
       financial information included in this quarterly 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 quarterly 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-14 and 15d-14) for the
       registrant and have:

         a) designed such disclosure controls and procedures 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
            quarterly report is being prepared;

         b) evaluated the effectiveness of the registrant's disclosure
            controls and procedures as of a date within 90 days prior to the
            filing date of this quarterly report (the "Evaluation Date"); and

         c) presented in this quarterly report our conclusions about the
            effectiveness of the disclosure controls and procedures based on
            our evaluation as of the Evaluation Date;

     5.The registrant's other certifying officers and I have disclosed,
       based on our most recent evaluation, 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
            controls which could adversely affect the registrant's ability to
            record, process, summarize and report financial data and have
            identified for the registrant's auditors any material weaknesses
            in internal controls; 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;

     6.The registrant's other certifying officers and I have indicated in
       this quarterly report whether there were significant changes in
       internal controls or in other factors that could significantly
       affect internal controls subsequent to the date or our most
       recent evaluation, including any corrective actions with regard
       to significant deficiencies and material weaknesses.


Date: February 14, 2003          /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> 28

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> 29


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  December 31, 2002 (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 14, 2003

<PAGE> 30

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  December 31, 2002 (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
February 14, 2003