Finance receivables consist of Contracts and Direct Loans and are detailed as follows:


	(In thousands)
	December 31, 2022			March 31, 2022
Finance receivables	$	155,213		$	178,786
Accrued interest receivable		2,903			2,315
Unearned dealer discounts		(5,463	)		(6,894	)
Unearned insurance commissions and fees		(1,889	)		(2,446	)
Purchase price discount		(93	)		(212	)
Finance receivables, net of unearned		150,671			171,549
Allowance for credit losses		(10,952	)		(2,949	)
Finance receivables, net	$	139,719		$	168,600

Contracts and Direct Loans each comprise a portfolio segment. The following tables present selected information on the entire portfolio of the Company:


	As of December 31,
Contract Portfolio	2022			2021
Average APR		22.8	%		22.8	%
Average discount		6.8	%		7.4	%
Average term (months)		50			50
Number of active contracts		16,364			20,013


	As of December 31,
Direct Loan Portfolio	2022			2021
Average APR		30.0	%		29.8	%
Average term (months)		26			26
Number of active contracts		6,505			6,103

The Company purchases Contracts from automobile dealers at a negotiated price that is less than the original principal amount being financed by the purchaser of the automobile. The Contracts are predominantly for used vehicles. As of December 31, 2022, the average model year of vehicles collateralizing the portfolio was a 2012 vehicle.

Direct Loans typically range from $500 to $15 thousand and generally are secured by a lien on an automobile, watercraft or other permissible tangible personal property. The majority of Direct Loans was originated with current or former customers under the Company’s automobile financing program. The typical Direct Loan represents a better credit risk than the typical Contract due to the customer’s prior payment history with the Company; however, the underlying collateral is generally less valuable. In deciding whether to make a loan, the Company considered the individual’s credit history, job stability, income, and impressions created during a personal interview with a Company loan officer. Additionally, because most of the Direct Loans made by the Company were made to current or former customers, the payment history of the borrower was a significant factor in making the loan decision. As of December 31, 2022, loans made by the Company pursuant to its Direct Loan program constituted approximately 15% of the aggregate principal amount of the Company’s loan portfolio. Changes in the allowance for credit losses for both Contracts and Direct Loans are driven primarily by consideration of the composition of the portfolio, current economic conditions, the estimated net realizable value of the underlying collateral, historical loan loss experience, delinquency, non-performing assets, and bankrupt accounts when determining management’s estimate of probable credit losses and adequacy of the allowance for credit losses. If the allowance for credit losses is determined to be inadequate, then an additional charge to the provision would be recorded to maintain adequate reserves based on management’s evaluation of the risk inherent in the loan portfolio. Additionally, credit loss trends over several reporting periods are utilized in estimating losses and overall portfolio performance. Conversely, the Company identifies abnormalities in the composition of the portfolio, which would indicate the calculation was overstated and management judgment may be required to determine the allowance of credit losses for both Contracts and Direct Loans.

Each portfolio segment consists of smaller balance homogeneous loans which are collectively evaluated for impairment.

The following table sets forth a reconciliation of the changes in the allowance for credit losses on Contracts and Direct Loans for the three months ended December 31, 2022 and 2021 (in thousands):


	Three months ended December 31, 2022									Nine months ended December 31, 2022
	Contracts			Direct Loans			Consolidated			Contracts			Direct Loans			Consolidated
Balance at beginning of period	$	5,088		$	2,003		$	7,091		$	1,960		$	989		$	2,949
Provision for credit losses		9,132			1,598			10,730			19,747			3,533			23,280
Charge-offs		(7,077	)		(1,056	)		(8,133	)		(17,266	)		(2,050	)		(19,316	)
Recoveries		1,240			24			1,264			3,942			97			4,039
Balance at December 31, 2022	$	8,383		$	2,569		$	10,952		$	8,383		$	2,569		$	10,952

	Three months ended December 31, 2021									Nine months ended December 31, 2021
	Contracts			Direct Loans			Consolidated			Contracts			Direct Loans			Consolidated
Balance at beginning of period	$	3,716		$	746		$	4,462		$	6,001		$	153		$	6,154
Provision for credit losses		1,325			350			1,675			2,515			1,285			3,800
Charge-offs		(3,546	)		(245	)		(3,791	)		(9,447	)		(618	)		(10,065	)
Recoveries		1,271			13			1,284			3,697			44			3,741
Balance at December 31, 2021	$	2,766		$	864		$	3,630		$	2,766		$	864		$	3,630

The Company uses the trailing twelve-month charge-offs, and applies this calculated percentage to ending finance receivables to calculate estimated probable credit losses for purposes of determining the allowance for credit losses. The Company then takes into consideration the composition of its portfolio, current economic conditions, estimated net realizable value of the underlying collateral, historical loan loss experience, delinquency, non-performing assets, and bankrupt accounts and adjusts the above, if necessary, to determine management’s total estimate of probable credit losses and its assessment of the overall adequacy of the allowance for credit losses. By including recent trends such as delinquency, non-performing assets, and bankruptcy in its determination, management believes that the allowance for credit losses reflects the current trends of incurred losses within the portfolio and is better aligned with the portfolio’s performance indicators.

The following table is an assessment of the credit quality by creditworthiness:


	(In thousands)
	December 31, 2022						December 31, 2021
	Contracts		Direct Loans		Total		Contracts		Direct Loans		Total
Performing accounts	$	120,299	$	22,077	$	142,376	$	147,589	$	22,216	$	169,805
Non-performing accounts		11,003		1,623		12,626		5,891		329		6,220
Total		131,302		23,700		155,002		153,480		22,545		176,025
Chapter 13 bankruptcy accounts		163		48		211		142		6		148
Finance receivables	$	131,465	$	23,748	$	155,213	$	153,622	$	22,551	$	176,173

A performing account is defined as an account that is less than 61 days past due. The Company defines an automobile contract as delinquent when more than 10% of a payment contractually due by a certain date has not been paid immediately by the following due date, which date may have been extended within limits specified in the servicing agreements or as a result of a deferral. The period of delinquency is based on the number of days payments are contractually past due, as extended where applicable.

In certain circumstances, the Company will grant obligors one-month payment extensions. The only modification of terms in those circumstances is to advance the obligor’s next due date by one month and extend the maturity date of the receivable. There are no other concessions, such as a reduction in interest rate, or forgiveness of principal or of accrued interest. Accordingly, the Company considers such extensions to be insignificant delays in payments rather than troubled debt restructurings.

A non-performing account is defined as an account that is contractually delinquent for 61 days or more or is a Chapter 13 bankruptcy account for which the accrual interest income has been suspended. The Company’s charge-off policy is to charge off an account in the month the contract becomes 121 days contractually delinquent.

In the event an account is dismissed from bankruptcy, the Company will decide whether to begin repossession proceedings or to allow the customer to make regularly scheduled payments.

The following tables present certain information regarding the delinquency rates experienced by the Company with respect to Contracts and Direct Loans, excluding Chapter 13 bankruptcy accounts:


	Contracts
	(In thousands, except percentages)
	Balance Outstanding		30 – 59 days			60 – 89 days			90 – 119 days			120+			Total
December 31, 2022	$	131,302	$	16,649		$	7,351		$	3,615		$	37		$	27,652
				12.68	%		5.60	%		2.75	%		0.03	%		21.06	%

March 31, 2022	$	154,143	$	7,097		$	2,936		$	1,183		$	48		$	11,264
				4.60	%		1.90	%		0.77	%		0.03	%		7.31	%

December 31, 2021	$	153,480	$	9,886		$	4,176		$	1,662		$	53		$	15,777
				6.44	%		2.72	%		1.08	%		0.03	%		10.28	%


	Direct Loans
	Balance Outstanding		30 – 59 days			60 – 89 days			90 – 119 days			120+			Total
December 31, 2022	$	23,700	$	2,989		$	1,102		$	515		$	6		$	4,612
				12.61	%		4.65	%		2.17	%		0.03	%		19.46	%

March 31, 2022	$	24,376	$	607		$	197		$	77		$	—		$	881
				2.49	%		0.81	%		0.32	%		—			3.61	%

December 31, 2021	$	22,545	$	636		$	199		$	130		$	—		$	965
				2.82	%		0.88	%		0.58	%		—			4.28	%