UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549


                                    FORM 10-Q

(Mark One)

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

          For the quarterly period ended June 30, 1999  or

          TRANSITION  REPORT  PURSUANT TO SECTION 13 OR 15(d) OF THE  SECURITIES
          EXCHANGE ACT OF 1934

          For the transition period from ___________ to ____________

          Commission file number 0001059083


                             NATIONWIDE CREDIT, INC.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

                   Georgia                              58-1900192
---------------------------------------  ---------------------------------------
        (State or other jurisdiction                  (IRS Employer
      of incorporation or organization)            Identification Number)


6190 Powers Ferry Road, 4th Floor, Atlanta, Georgia        30339
--------------------------------------------------------------------------------
(Address of principal executive offices)                (Zip Code)


Registrant's telephone number, including area code:     (770) 644-7452

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by  Sections  13 or 15(d)  of the  Securities  Exchange  Act of 1934
during the preceding 12 months (or for such shorter  period that the  registrant
was  required  to file such  reports),  and (2) has been  subject to such filing
requirements for the past 90 days.

Yes X No




<PAGE>



                                TABLE OF CONTENTS



                                                                       PAGE


PART I.  FINANCIAL INFORMATION


ITEM 1. FINANCIAL STATEMENTS

 Condensed Consolidated Balance Sheets
     as of June 30, 1999 and December 31, 1998 ...............................1

 Condensed Consolidated Statements of Operations
     for the Quarters ended June 30, 1999 and June 30, 1998,
     and the Six Months Ended June 30, 1999 and June 30, 1998.................3

 Condensed Consolidated Statements of Cash Flows
     for the Six Months Ended June 30, 1999 and June 30, 1998.................4

 Notes to Condensed Consolidated
     Financial Statements as of June 30, 1999.................................5


ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
        FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS ........................................................8


PART II.  OTHER INFORMATION

        None

SIGNATURE. ..................................................................14


<PAGE>



PART I.  FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

NATIONWIDE CREDIT, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollar amounts in thousands)


<TABLE>
<CAPTION>

                                                                           June 30, 1999            December 31, 1998
                                                                            Unaudited                  Audited
                                                                         -----------------        ------------------
<S>                                                                      <C>                      <C>
Assets
Current assets:
     Cash and cash equivalents                                           $       2,801            $      3,201
     Cash held for clients                                                       2,285                   2,279
     Accounts receivable, net of allowance of
             $822 and $951, respectively                                        13,736                  12,885
     Prepaid expenses and other current assets                                   1,991                   1,208
                                                                         ------------------       ------------------

Total current assets                                                            20,813                  19,573

Property and equipment, less accumulated
     Depreciation of $6,840 and $4,575, respectively                             8,599                   9,859


Other assets, net:
     Goodwill, less accumulated amortization of $5,460
           and $3,763, respectively                                            100,410                 102,107
     Other intangible assets, less accumulated amortization
           of $16,695 and $15,978, respectively                                  3,584                   4,301
     Deferred financing costs, less accumulated amortization
           of $2,538 and $2,288, respectively                                    3,987                   4,238
     Other assets                                                                  236                     237
                                                                         ------------------       ------------------

Total assets                                                             $     137,629            $    140,315
                                                                         ==================       ==================



The  accompanying  notes are an integral  part of these  condensed  consolidated balance sheets.
</TABLE>


<PAGE>


NATIONWIDE CREDIT, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollar amounts in thousands)

<TABLE>
<CAPTION>


                                                                            June 30, 1999          December 31, 1998
                                                                              Unaudited                 Audited
                                                                           -----------------        ------------------
<S>                                                                        <C>                     <C>
Liabilities and stockholder's equity

Current liabilities:
    Collections due to clients                                             $      2,285            $      2,279
    Accrued compensation                                                          3,184                   4,201
    Accounts payable                                                              1,503                   1,870
    Accrued severance and office closure costs                                    1,251                   1,845
    Other accrued liabilities                                                     5,302                   5,273
    Current maturities of long-term debt                                          3,700                     250
                                                                           -----------------       ------------------

Total current liabilities                                                        17,225                  15,718

Accrued severance and office closure costs                                        2,179                   2,400

Long-term debt, less current maturities                                         118,375                 118,500

Stockholder's equity:
Common stock - $.01 par value
  Authorized shares - 10,000 shares
   Issued and outstanding shares - 1,000 shares                                      --                      --
Additional paid in capital                                                       39,465                  39,465
Accumulated deficit                                                             (39,475)                (35,628)
Notes receivable - officers                                                        (140)                   (140)
                                                                           -----------------       ------------------
Total stockholder's equity                                                         (150)                  3,697
                                                                           -----------------       ------------------

Total liabilities and stockholder's equity                                 $    137,629            $    140,315
                                                                           =================       ==================


The  accompanying  notes are an integral  part of these  condensed  consolidated
balance sheets.

</TABLE>


<PAGE>


NATIONWIDE CREDIT, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollar amounts in thousands)
<TABLE>
<CAPTION>

                                                                   For the Three Months               For the Six Months
                                                                      Ended June 30,                    Ended June 30,
                                                              -------------------------------    ------------------------------
                                                                  1999            1998               1999            1998
                                                                Unaudited       Unaudited          Unaudited      Unaudited
                                                              -------------- ----------------    -------------- ---------------

<S>                                                             <C>            <C>               <C>              <C>
Revenue                                                         $   27,884     $   24,652        $    55,150      $  54,577

Expenses:
      Salaries and benefits                                         18,492         15,712             36,924         32,751
      Telecommunication                                              1,179          1,410              2,098          2,769
      Occupancy                                                      1,108            965              2,133          2,123
      Other operating and administrative                             3,426          3,620              6,703          7,332
      Depreciation and amortization                                  2,262          6,126              4,678         12,256
      Provision for employee severance and office closure               --             --                243             --
                                                               -------------- ----------------    -------------- ---------------

Total expenses                                                      26,467         27,833             52,779         57,231

                                                              -------------- ----------------    -------------- ---------------
Operating income (loss)                                              1,417         (3,181)             2,371         (2,654)
Interest expense                                                     3,104          3,087              6,218          7,261
                                                              -------------- ----------------    -------------- ---------------
Loss before income taxes                                            (1,687)        (6,268)            (3,847)        (9,915)

Provision for income taxes                                              --             --                 --             --
                                                              -------------- ----------------    -------------- ---------------
Loss before extraordinary item                                      (1,687)        (6,268)            (3,847)        (9,915)

Extraordinary loss on debt extinguishment                               --             --                 --            783
                                                              -------------- ----------------    -------------- ---------------

Net loss                                                         $  (1,687)     $  (6,268)         $  (3,847)     $ (10,698)
                                                              ============== ================    ============== ===============


The  accompanying  notes are an integral  part of these  condensed  consolidated
financial statements.

</TABLE>

<PAGE>


NATIONWIDE CREDIT, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollar amounts in thousands)

<TABLE>
<CAPTION>

                                                                                            For the Six Months
                                                                                              Ended June 30,
                                                                                  ----------------------------------------
                                                                                       1999                    1998
                                                                                     Unaudited               Unaudited
                                                                                  ----------------        ----------------
<S>                                                                                  <C>                 <C>
Operating activities
     Net loss                                                                        $  (3,847)          $     (10,698)
     Adjustments  to reconcile  net loss to net cash provided by operating
       activities:
         Depreciation and amortization                                                   4,929                  13,651
         Extraordinary loss on debt extinguishment                                          --                     783
             Other non-cash charges                                                        243                      --
      Changes in operating assets and liabilities:
             Accounts receivable                                                          (851)                    484
             Prepaid expenses and other assets                                            (782)                    (31)
             Accrued compensation                                                       (1,016)                     (6)
             Accounts payable and other accrued liabilities                             (1,396)                  4,993
                                                                                  ----------------        ----------------
     Net cash (used in) provided by operating activities                                (2,720)                  9,176

Investing activities
      Acquisitions, net of cash acquired                                                    --                (157,270)
      Purchases of property and equipment                                               (1,005)                 (2,049)
                                                                                  ----------------        ----------------
      Net cash used in investing activities                                             (1,005)               (159,319)

Financing activities
     Proceeds from acquisition facilities                                                   --                 125,000
     Capital contribution from Parent                                                       --                  38,975
     Proceeds from revolving line of credit                                              3,450                     ---
     Proceeds from long-term debt                                                           --                 125,000
     Repayment of acquisition facilities                                                    --                (125,000)
     Repayment of long-term debt                                                          (125)                   (125)
     Debt issuance and acquisition costs                                                    --                  (6,562)
     Other                                                                                  --                    (268)
                                                                                  ----------------        ----------------
     Net cash  provided by financing activities                                          3,325                 157,020
                                                                                  ----------------        ----------------

     (Decrease) increase in cash and cash equivalents                                     (400)                  6,877

Cash and cash equivalents at beginning of period                                         3,201                   1,388
                                                                                  ----------------        ----------------

Cash and cash equivalents at end of period                                          $    2,801           $       8,265
                                                                                  ================        ================

Cash paid for interest                                                              $    6,100           $       1,711
                                                                                  ================        ================



The  accompanying  notes are an integral  part of these  condensed  consolidated
financial statements.

</TABLE>



<PAGE>


NATIONWIDE CREDIT, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS



1.   Basis of Presentation

     The  accompanying  unaudited  consolidated  financial  statements have been
     prepared in accordance with generally  accepted  accounting  principles for
     interim  financial  information and with the  instructions to Form 10-Q and
     Article 10 of Regulation S-X. Accordingly, certain information and footnote
     disclosures  required  by  generally  accepted  accounting  principles  for
     complete  financial  statements  have  been  excluded.  In the  opinion  of
     management,  all  adjustments  (consisting  of normal  recurring  accruals)
     considered  necessary  for a fair  presentation  have  been  included.  All
     significant  intercompany accounts and transactions have been eliminated in
     the  consolidation.   The  accompanying  unaudited  consolidated  financial
     statements  should be read in  conjunction  with the  audited  consolidated
     financial  statements  of the Company for the year ended  December 31, 1998
     included in Form 10K, as amended.

     On December 31, 1997, NCI Acquisition Corporation (the "Buyer"), NCI Merger
     Corporation ("Merger Sub"), Nationwide Credit, Inc. (the "Company"),  First
     Data  Corporation  (the  "Seller") and its wholly owned  subsidiary,  First
     Financial Management  Corporation  ("FFMC"),  entered into an agreement and
     Plan of merger (the "Merger Agreement") pursuant to which Merger Sub merged
     with and into the Company,  with the Company as surviving corporation and a
     wholly owned subsidiary of the Buyer (the  "Transaction").  The Transaction
     was  accounted  for  under  the  purchase  method  of  accounting  with the
     consideration  and related fees of the acquisition  allocated to the assets
     acquired and  liabilities  assumed based on their  estimated fair values at
     the date of the acquisition.

     The acquisition and related fees were initially financed through borrowings
     of $125.0  million  against a $133.0  million  senior credit  facility (the
     "Acquisition  Facilities")  and a  contribution  of $40.4 million of equity
     capital  (before related fees of $1.4 million).

     Operating  results  for the  six-month  period  ended June 30, 1999 are not
     necessarily  indicative  of the results  that may be expected  for the year
     ending December 31, 1999.

     In June 1998, the Financial  Accounting Standards Board issued statement of
     Financial  Accounting  Standards No. 133  "Accounting  for  Derivative  and
     Hedging  Activities"  (SFAS 133).  SFAS 133  requires  companies  to record
     derivatives  on the balance sheet as assets or  liabilities  at fair value.
     Due to a recent amendment,  SFAS 133 is effective for financial  statements
     for fiscal years  beginning  after June 15, 2000. The Company is evaluating
     the  impact of SFAS 133 on the  Company's  future  earnings  and  financial
     position, but does not expect it to be material.

2.   Nature of Operations

     The  Company  is  among  the  largest  independent  providers  of  accounts
     receivable  management  services in the United States. The Company's client
     base is  comprised  of  companies  located  throughout  the  United  States
     primarily   in  the   financial   services,   telecommunications,   retail,
     institutional and healthcare industries.

<PAGE>

3.   Commitments and Contingencies

     The  Company is  involved  in certain  litigation  arising in the  ordinary
     course of business.  In the opinion of management,  the ultimate resolution
     of these matters will not have a material  adverse  effect on the Company's
     consolidated financial position or results of operations.

4.   Provision for Merger Costs, Employee Severance and Office Closure

     In 1998,  as a result of the  acquisition  of the Company and in connection
     with the  implementation  of an  operating  improvement  plan,  the Company
     accrued  estimated  costs of  approximately  $4.0 million  associated  with
     closing certain offices and branches ($2.3 million),  severance payments to
     employees   ($0.8   million),   and   relocation   costs  ($0.9   million).
     Specifically, the company is closing and/or reducing branches which are not
     operating at full capacity,  or whose  operations can be consolidated  with
     other branches.

     In December  1998, the Company  decided to relocate its corporate  offices.
     The Company has entered into a lease agreement for a new facility for these
     offices.  The  Company  recorded  a charge of $1.6  million  in 1998  which
     represents the future rent  obligations  under the existing lease offset by
     estimated sublease income less broker  commissions.  The Company expects to
     vacate its current headquarters  facility during the third quarter of 1999.

     In March  1999,  the  Company  terminated  certain  employees  as part of a
     reorganization  and staff reduction.  The Company recorded a charge of $0.2
     million for employee severance.

     The amounts remaining at June 30, 1999 from these accruals are as follows:

             Office closure             $    2,752
             Employee severance                420
             Relocation                        258
                                      ===============
                                        $    3,430
                                      ===============



<PAGE>

5.   Subsequent Events

     On July 19, 1999, the Company announced  appointments of Loren F. Kranz and
     Michael Lord as Co-Chief Executive  Officers,  succeeding Jerry Kaufman who
     has been named Vice Chairman of the Board of Directors.  These appointments
     will  ensure the  continuity  of  executive  leadership  and  solidify  the
     strategic  business  unit  concept  that has been piloted over the last six
     months.

     On  August  13,  1999,  in order to fund the  growth of the  business,  the
     Company raised an additional  $4.0 million of equity from certain  existing
     investors  and amended its  Revolving  Credit  Facility  and Term Loan (the
     "Bank  Facilities") to create an additional  $5.0 million of  availability.
     Specifically,  $3.4  million of existing  debt under the  Revolving  Credit
     Facility was converted to a Term Loan Facility,  bearing  interest at LIBOR
     plus 4%,  payable in 13  consecutive  quarterly  installments  of  $250,000
     beginning  September  30,  2000,  with the final  payment  of  $200,000  on
     December 31, 2003.  The existing line of credit under the Revolving  Credit
     Facility was  increased by $1.5 million from $5.0 million to $6.5  million,
     matures  January 2004 and bears interest at the Company's  option of either
     (A) the Base Rate plus the  Applicable  Margin or (B) the  Eurodollar  Rate
     plus the  Applicable  Margin.  The maturity  date of the existing Term Loan
     Facility  balance of $18.6  million was also changed from December 31, 2004
     to January 28, 2004.

     In connection with the above  recapitalization,  the Company  negotiated an
     amendment  to the  Credit  Agreement  that  revised  cumulative  EBITDA and
     related   ratio   covenants  to  reflect  the  Company's   revised   EBITDA
     expectations. As of June 30, 1999, the Company was in compliance with these
     revised covenants.

     The effect of the additional  equity and amendments to the Bank  Facilities
     on a pro forma basis is as follows:

<TABLE>
<CAPTION>


                                                                         June 1999             June 1999
                                                                         Pro forma             Historical
                                                                   ---------------------- ---------------------
                                                                                   (In $000's)

        <S>                                                             <C>                     <C>
        Cash                                                            $     6,801             $    2,801
        Current maturities of long-term debt                                    250                  3,700
        Long-term debt, less current maturities                             121,825                118,375
        Total stockholder's equity                                            3,850                   (150)
</TABLE>


     The pro  forma  data is  based  on  historical  information  and  does  not
     necessarily  reflect the actual  results that would have occurred nor is it
     necessarily indicative of future results of operations.

<PAGE>


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

Results of Operations

(Six months ended June 30, 1999 compared to six months ended June 30, 1998)

Revenue. Total revenue was $55.2 million for the six months ended June 30, 1999,
as compared to $54.6 million for the six months ended June 30, 1998, an increase
of $0.6 or 1.1%.  The  increase  was  primarily  the  result  of a $5.1  million
increase in revenue  from on-site  call center  management  services for a major
telecommunications company offset by (i) a $2.0 million decrease in revenue from
the  Department  of  Education  ("DOE")  which is the  result  of a delay in new
placements in 1999 under the new GSA contract,  (ii) a $0.9 million  decrease in
revenue from outsourced  pre-chargeoff management services, and (iii) a decrease
in revenue from telecommunications account placements of $1.6 million.

Expenses. Salaries and benefits expense increased $4.1 million or 12.5% to $36.9
million for the six months  ended June 30,  1999 from $32.8  million for the six
months  ended  June 30,  1998.  This  increase  is  primarily  the result of the
Company's  service  expansion  that  includes  on-site call center  staffing and
management services for a major telecommunications company.

Telecommunications  expense  decreased $0.7 million or 25.0% to $2.1 million for
the six months  ended June 30,  1999 from $2.8  million  for the same  period in
1998.  The decrease is primarily  the result of lower  negotiated  long distance
rates and lower call volume.

Occupancy  expense  remained  flat at $2.1 million for the six months ended June
30, 1999 and 1998. The Company  closed its Atlanta data center and  consolidated
these  operations into the Phoenix data center in May 1998 and closed the Denver
facility in February 1999. Rent increases in 1999 offset the decreases resulting
from these office closings.

Other  operating and  administrative  expense  decreased $0.6 million or 8.2% to
$6.7  million for the six months  ended June 30, 1999 from $7.3  million for the
same  period in 1998.  The  decrease  is the result of the  continuation  of the
Company's operating improvement plan.

Depreciation  and amortization  expense  decreased $7.6 million or 61.8% to $4.7
million for the six months  ended June 30, 1999 from $12.3  million for the same
period  ended  June 30,  1998.  The  decrease  was  primarily  the result of the
amortization  of the value of existing  placements  of $7.3  million for the six
months ended June 30, 1998, as compared to no  amortization  for the same period
in 1999. The value of existing placements of $14.5 million was amortized over 12
months in 1998.

Provision  for Employee  Severance  and Office  Closure:  Provision for employee
severance  and office  closure for the six months ended June 30, 1999,  was $0.2
million, all of which related to employee severance.

Operating  Income.  Operating  income was $2.4  million for the six months ended
June 30, 1999, an increase of $5.1 million or 188.9% from a loss of $2.7 million
for the same period in 1998.  This increase has been  explained in the preceding
paragraphs.  To summarize, this increase is the result of an increase in revenue
of $.6 million,  a decrease in  depreciation  and  amortization  expense of $7.6
million, a decrease in telecommunications expense of $0.7 million, a decrease in
other  operating  and  administrative  expense  of $0.7  million,  offset  by an
increase in salaries and benefits expense of $4.2 million.

Interest Expense. Interest expense relating to the Term Loan Facility and Senior
Notes was $6.2 million for the six months  ended June 30, 1999  compared to $7.3
million for the same period in 1998, a decrease of $1.1 million. The decrease is
due to the write-off of $1.1 million related to the cost of interim financing of
the Transaction in January 1998.

Extraordinary  Loss.  The  extraordinary  loss for the six months ended June 30,
1998 of $0.8 million  represents  the write-off of deferred debt issuance  costs
related to interim financing of the Transaction.

Net Loss. The Company incurred a net loss for the six months ended June 30, 1999
of $3.8 million as compared to a net loss of $10.7
million in the same period of 1998.


(Three months ended June 30, 1999 compared to three months ended June 30, 1998)

Revenue.  Total  revenue was $27.9  million for the three  months ended June 30,
1999,  as compared to $24.7 million for the three months ended June 30, 1998, an
increase of $3.2 million or 13.0%.  The increase was  primarily the result of an
increase in revenue of $2.6 million from on-site call center management services
for a major  telecommunications  company  and an  increase  in revenue  from the
Department of Education ("DOE") of $1.3 million.  These increases were offset by
(i) a decrease in revenue from  telecommunications  account  placements  of $0.3
million,  and  (ii) a  decrease  in  revenue  of $0.4  million  from  outsourced
pre-chargeoff management services.

Expenses. Salaries and benefits expense increased $2.8 million or 17.8% to $18.5
million  for the three  months  ended June 30,  1999 from $15.7  million for the
three months ended June 30, 1998.  This  increase is primarily the result of the
Company's  service  expansion  that  includes  on-site call center  staffing and
management services for a major telecommunications company.

Telecommunications  expense  decreased $0.2 million or 14.3% to $1.2 million for
the three  months  ended June 30, 1999 from $1.4  million for the same period in
1998.  The decrease is primarily  the result of lower  negotiated  long distance
rates and lower call volume.

Occupancy  expense increased $0.1 million or 10.0% to $1.1 million for the three
months  ended June 30, 1999 from $1.0  million for the same period in 1998.  The
Company closed its Atlanta data center and  consolidated  these  operations into
the Phoenix  data center in May 1998 and closed the Denver  facility in February
1999. The decreases  resulting  from these office  closings were offset by April
1999 rent increases.

Other  operating and  administrative  expense  decreased $0.2 million or 5.6% to
$3.4  million for the three months ended June 30, 1999 from $3.6 million for the
same  period in 1998.  The  decrease  is the result of the  continuation  of the
Company's operating improvement plan.

Depreciation  and amortization  expense  decreased $3.8 million or 62.3% to $2.3
million for the three  months ended June 30, 1999 from $6.1 million for the same
period  ended  June 30,  1998.  The  decrease  was  primarily  the result of the
amortization  of the value of existing  placements of $3.6 million for the three
months ended June 30, 1998, as compared to no  amortization  for the same period
in 1999. The value of existing placements of $14.5 million was amortized over 12
months in 1998.

Operating  Income.  Operating income was $1.4 million for the three months ended
June 30, 1999, an increase of $4.6 million or 144.5% from a loss of $3.2 million
for the same period in 1998.  This  increase is primarily  due to an increase in
revenue of $3.2 million, a decrease in depreciation and amortization  expense of
$3.9  million,  a decrease  in  telecommunications  expense of $0.2  million,  a
decrease in other operating and administrative  expense of $0.2 million,  offset
by an increase in salaries and benefits expense of $2.8 million.

Interest Expense. Interest expense relating to the Term Loan Facility and Senior
Notes  remained  flat at $3.1 million for the three month periods ended June 30,
1999 and 1998.

Net Loss.  The Company  incurred a net loss for the three  months ended June 30,
1999 of $1.7  million  as  compared  to a net loss of $6.3  million  in the same
period of 1998.


Liquidity and Capital Resources

Cash used in operating activities was $2.7 million for the six months ended June
30, 1999 as compared to cash  provided by operating  activities  of $9.2 million
for the six months ended June 30, 1998, resulting in an increase in cash used of
$11.9  million.  This  increase is primarily  due to cash  interest  paid on the
Senior Notes and the Term Loan  Facility of $6.1 million in the first six months
of 1999  compared to $1.7 million in the same period of 1998.  Net income before
extraordinary items and after adding back depreciation,  amortization, taxes and
interest  (EBITDA) was $7.3 million compared to $9.6 million in the 1998 period.
Net working capital items increased by $4.0 million in the six months ended June
30, 1999 as compared to a decrease of $5.4 million in the same period of 1998.

Cash used in  investing  activities  for the six months  ended June 30, 1999 was
$1.0  million and $159.3  million for the six months  ended June 30,  1998.  The
Company's  principal  use of cash in  investing  activities  during 1999 was for
capital  expenditures,   primarily  for  new  computer  and   telecommunications
equipment.  The Acquisition of $157.3 million in 1998 represents the purchase of
the Company (see Note 1).

Cash provided by financing  activities was $3.3 million for the six months ended
June 30, 1999  representing  $3.5 million of proceeds  from a revolving  line of
credit and the required first and second quarterly  repayments of the seven-year
term loan facility. Cash provided by financing activities was $157.0 million for
the six months ended June 30, 1998, representing the funding of the Transaction.

Substantially  all  the  agreements   relating  to  the  Company's   outstanding
indebtedness  contain covenants that impact the Company's  liquidity and capital
resources,  including  financial covenants and restrictions on the incurrence of
indebtedness  and  liens and  asset  sales.  On August  13,  1999,  the  Company
negotiated an amendment to the Credit Agreement that increases the existing line
of credit under the Revolving  Credit Facility from $5.0 million to $6.5 million
and converts $3.4 million of existing debt under the Revolving  Credit  Facility
into a Term Loan Facility. In addition to this refinancing,  on August 13, 1999,
certain existing investors of the Company contributed an additional $4.0 million
of equity to fund the growth of the business.

The ability of the Company to meet its debt  service  obligations  and to comply
with the  restrictive  and  financial  covenants  contained in the Senior Credit
Facility,  the Revolving  Credit Facility and the Notes will be dependent on the
future operating and financial performance of the Company, which will be subject
in part to a number of  factors  beyond  the  control  of the  Company,  such as
prevailing economic conditions,  interest rates and demand for credit collection
services.

Management  believes that, based on current levels of operations and anticipated
improvements  in operating  results,  cash flows from  operations and borrowings
available under the credit  facilities will be adequate to allow for anticipated
capital  expenditures  for the  next  several  years,  to fund  working  capital
requirements and to make required payments of principal and interest on its debt
for the next  several  years.  However,  if the  Company  is unable to  generate
sufficient cash flows from operations in the future, it may be necessary for the
Company  to  refinance  all or a  portion  of its debt or to  obtain  additional
financing, but there can be no assurance that the Company will be able to effect
such refinancing or obtain additional financing on commercially reasonable terms
or at all.


Income Taxes

The Company has not recorded any tax benefit on its loss before income taxes for
the six months  ended June 30, 1999 and 1998 as it is not "more likely than not"
that the Company will be able to realize such benefits.


Year 2000

Until  recently,  computer  programs  were  written  to store only two digits of
date-related  information  in order to more  efficiently  handle and store data.
Thus, the programs were unable to properly distinguish between the year 1900 and
the year 2000. This is frequently referred to as the "Year 2000 Problem."

In 1997,  the Company  initiated a  company-wide  Year 2000  project  based on a
methodology  recommended  by an outside  consultant,  with a dedicated Year 2000
Project  Office and  Coordinator.  The  Company  has  completed  the  process of
defining,  assessing and converting, or replacing, various programs and hardware
to make them Year 2000 compatible.  The Company is currently  conducting  formal
compliance testing of the renovated applications, which cover all sensitive time
periods (e.g., the weeks straddling  December 1999 to January 2000, February 29,
2000,  etc).  Two of  four  collection  applications  have  completed  extensive
testing, with the other two on target for a third quarter completion.

The total cost for the Year 2000 remediation is estimated at approximately  $1.5
million,  which includes $0.4 million for the purchase of new software that will
be capitalized  and $1.1 million that will be expensed as incurred.  The Company
incurred and expensed approximately $0.4 million and $0.3 million during the six
months and quarter ended June 30, 1999,  respectively,  primarily for assessment
of the Year 2000 issue,  the development of a modification  plan and programming
costs.

The Year 2000 Problem goes beyond the Company's  internal  computer  systems and
requires coordination with clients, vendors, government entities and other third
parties to assure  that their  systems  and related  interfaces  are  compliant.
Accordingly,  the Company has implemented an aggressive  client outreach program
to analyze the data interfaces shared with customers, partners and suppliers and
to  coordinate  specific  plans  for their  needs.  Clients  sharing  electronic
interfaces  with the Company are  currently  being  contacted and the goal is to
have such  interfaces  aligned by the end of the third quarter of 1999. A vendor
outreach  program has also been  implemented  to identify  critical  systems for
supplied  products and services,  and to analyze the risk to the Company and its
customers  should the products or services  fail.  At this point,  all pertinent
vendor  compliance issues have been identified and most replacements or upgrades
have occurred.  There will continue to be replacements  and upgrades through the
third quarter of 1999,  however,  there are currently no critical  vendor issues
unresolved.  The  procurement  process  continues  to  be  reviewed  to  prevent
acquisition of non-compliant products.

The Company is also  addressing  the impact of Year 2000 on its  non-information
technology  systems,  which  include  examination  of each  location  to  ensure
lighting, elevators, copiers and fax machines function properly. This portion of
the Year  2000  project  is  expected  to be  completed  by the end of the third
quarter of 1999.  Additionally,  on-going  internal and external  communications
through  monthly  executive  reviews  and weekly  project  reviews  ensure  that
progress is monitored by senior management.

The  Company  recognizes  the need for  contingency  plans in all aspects of the
project,  and such plans are now being  outlined.  The target for  completion of
enterprise  contingency plans has been moved from June 30, 1999 to September 30,
1999.  This change allows the Company to better focus on detailed plans tailored
to each  functional  business  area.  The  Company  is also  in the  process  of
developing  contingency  plans  customized for some clients based on their needs
and schedules.

The Company  believes  that with  testing and  communication  with its  clients,
vendors  and  employees,  the  Year  2000  problem  will  not  pose  significant
operational  problems for its  computer  systems.  However,  if such testing and
analysis is not  completed in a timely  fashion or if the  Company's  clients or
significant suppliers do not successfully achieve Year 2000 compliance, the Year
2000  Problem  could have a material  impact on the  operations  of the  Company
including a reduction in revenue and profit.

The costs of the  project  and the date on which the  Company  believes  it will
complete the Year 2000  modifications  are based on management's best estimates,
which were derived utilizing  numerous  assumptions of future events,  including
the continued  availability  of certain  resources and other  factors.  However,
there can be no  guarantee  that these  estimates  will be  achieved  and actual
results could differ materially from those anticipated.


Forward-Looking Statements

This Form  10-Q and other  communications,  as well as oral  statements  made by
representatives of the Company, may contain "forward-looking  statements" within
the  meaning of the  Private  Securities  Litigation  Reform Act of 1995.  These
statements  relate to,  among other  things,  the  Company's  outlook for future
periods,  market forces within the industry, cost reduction strategies and their
results,  planned capital  expenditures,  long-term objectives of management and
other  statements of  expectations  concerning  matters that are not  historical
facts.

Predictions of future results contain a measure of uncertainty and, accordingly,
actual  results could differ  materially  due to various  factors.  Factors that
could  change  forward-looking  statements  are,  among  others,  changes in the
general economy, changes in demand for the Company's services and/or cyclicality
in the  industries  to which the Company's  services are rendered,  governmental
regulations and other  unforeseen  circumstances.  A number of these factors are
discussed in this Form 10-Q and in the Company's  annual report on Form 10-K for
the year ended December 31, 1998.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

<TABLE>
<CAPTION>


                                                          Long Term Debt
                                                      Non-Traded Instruments
                                                        As of June 30, 1999
                                                            (In $000's)


                                   1999       2000      2001      2002      2003      Thereafter   Total     Fair Value
                                   -------- -------- --------- --------- --------- ------------ ---------- ------------
<S>                                <C>       <C>         <C>       <C>       <C>        <C>        <C>        <C>
Variable Rate:
    Term Loan Facility :           $ 250     $ 250      $ 250     $ 250     $ 250      $17,500    $18,750    $18,625
        $18 million                 8.75%     9.00%      9.00%     9.00%     9.00%        9.00%
        $.625 million              10.50%    10.50%     10.50%    10.50%    10.50%       10.50%
    Revolving Credit Facility:
        $3.45 million              10.25%

Fixed Rate:
Senior Notes due 2008:             $  --     $  --      $  --     $  --     $  --      $100,000   $100,000   $83,000
$100 million @ 10.25%                                                                     10.25%

</TABLE>

The Company's  primary risk exposure in the normal course of business is that of
interest rate risk. There have been no material changes in this type of exposure
during the periods presented.


PART II.  OTHER INFORMATION - None




<PAGE>


SIGNATURE


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


NATIONWIDE CREDIT, INC.




/s/ Michael Lord
------------------------------------------------------------
Michael Lord
Chief Financial Officer

Dated:  August 16, 1999