Allowance for Credit Losses

3 Months Ended

Mar. 31, 2024

Note 5. Allowance for Credit Losses

Our allowance for credit losses represents our current estimate of expected credit losses over the remaining contractual life of certain financial assets, including credit cards as well as commercial and consumer banking loans acquired in the Bank Merger, which relate to our Financial Services segment, and accounts receivables primarily related to our Technology Platform segment. Given our methods of collecting funds on servicing receivables, our historical experience of infrequent write offs, and that we have not observed meaningful changes in our counterparties’ abilities to pay, we determined that the future exposure to credit losses on servicing related receivables was immaterial. See our Annual Report on Form 10-K for further discussion of the methodology and policies for determining our allowance for credit losses for each of our loan portfolios.

The following table presents changes in our allowance for credit losses:


	Credit Card(1)		Commercial and Consumer Banking(1)		Accounts Receivable(1)










Three Months Ended March 31, 2024
Balance at December 31, 2023	$	52,385	$	2,310	$	1,837
Provision for credit losses(2)	7,253		(71)		2,411
Write-offs charged against the allowance	(10,546)		(18)		(2,139)
Balance at March 31, 2024	$	49,092	$	2,221	$	2,109
Three Months Ended March 31, 2023
Balance at December 31, 2022	$	39,110	$	1,678	$	2,785
Provision for credit losses(2)	8,237		170		(854)
Write-offs charged against the allowance	(10,258)		—		(286)
Balance at March 31, 2023	$	37,089	$	1,848	$	1,645

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(1)Credit cards and commercial and consumer banking loans measured at amortized cost, net of allowance for credit losses, are presented within loans held for investment, at amortized cost in the condensed consolidated balance sheets. Accounts receivable balances, net of allowance for credit losses, are presented within other assets in the condensed consolidated balance sheets.

(2)The provision for credit losses on credit cards and commercial and consumer banking loans is presented within noninterest expense—provision for credit losses in the condensed consolidated statements of operations and comprehensive income (loss). During the three months ended March 31, 2024, recoveries of amounts previously reserved related to credit cards were $1,083, and immaterial during the three months ended March 31, 2023. There were immaterial recoveries of amounts previously reserved related to commercial and consumer banking loans during the three months ended March 31, 2024 and 2023. The provision for credit losses on accounts receivable is presented within noninterest expense—general and administrative in the condensed consolidated statements of operations and comprehensive income (loss). During the three months ended March 31, 2024 and 2023, recoveries of amounts previously reserved related to accounts receivable were $497 and $1,161, respectively.

Credit card: Accrued interest receivables written off by reversing interest income were $2.5 million and $2.2 million during the three months ended March 31, 2024 and 2023, respectively.