Cover Page
Cover Page - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Feb. 24, 2021 | Jun. 30, 2020 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2020 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-37680 | ||
Entity Registrant Name | ELEVATE CREDIT, INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 46-4714474 | ||
Entity Address, Address Line One | 4150 International Plaza | ||
Entity Address, Address Line Two | Suite 300 | ||
Entity Address, City or Town | Fort Worth | ||
Entity Address, State or Province | TX | ||
Entity Address, Postal Zip Code | 76109 | ||
City Area Code | 817 | ||
Local Phone Number | 928-1500 | ||
Title of 12(b) Security | Common Shares, $0.0004 par value | ||
Trading Symbol | ELVT | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | true | ||
ICFR Auditor Attestation Flag | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 45,042,141 | ||
Entity Common Stock, Shares Outstanding | 36,838,621 | ||
Documents Incorporated by Reference | Portions of the Registrant’s Proxy Statement for the 2021 Annual Meeting of Stockholders are incorporated herein by reference in Part III of this Annual Report on Form 10-K to the extent stated herein. Such proxy statement will be filed with the Securities and Exchange Commission within 120 days of the Registrant’s fiscal year ended December 31, 2020. | ||
Entity Central Index Key | 0001651094 | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | |
ASSETS | |||
Cash and cash equivalents | [1] | $ 197,983 | $ 71,215 |
Restricted cash | 3,135 | 2,235 | |
Loans receivable, net of allowance for loan losses of $86,996 and $79,912, respectively | [1] | 374,832 | 542,073 |
Prepaid expenses and other assets | [1] | 10,060 | 6,737 |
Operating lease right of use assets | 8,320 | 10,191 | |
Receivable from CSO lenders | 1,255 | 8,696 | |
Receivable from payment processors | [1] | 6,147 | 8,681 |
Deferred tax assets, net | 25,958 | 8,784 | |
Property and equipment, net | 34,000 | 35,944 | |
Goodwill | 6,776 | 6,776 | |
Intangible assets, net | 1,133 | 1,253 | |
Assets from discontinued operations | 0 | 81,002 | |
Total assets | 669,599 | 783,587 | |
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||
Accounts payable and accrued liabilities (See Note 16) | [1] | 52,252 | 38,679 |
Operating lease liabilities | 11,952 | 14,352 | |
Deferred revenue | [1] | 3,134 | 12,087 |
Notes payable, net (See Note 16) | [1] | 438,403 | 525,439 |
Liabilities from discontinued operations | 0 | 36,541 | |
Total liabilities | 505,741 | 627,098 | |
COMMITMENTS, CONTINGENCIES AND GUARANTEES (Note 14) | |||
STOCKHOLDERS’ EQUITY | |||
Preferred stock; $0.0004 par value; 24,500,000 authorized shares; none issued and outstanding at December 31, 2020 and 2019 | 0 | 0 | |
Common stock; $0.0004 par value; 300,000,000 authorized shares; 44,960,438 and 44,445,736 issued; 37,954,138 and 43,676,826 outstanding, respectively | 18 | 18 | |
Additional paid-in capital | 200,433 | 193,061 | |
Treasury stock; at cost; 7,006,300 and 768,910 shares of common stock, respectively | (16,492) | (3,344) | |
Accumulated deficit | (20,101) | (34,342) | |
Accumulated other comprehensive income, net of tax benefit of $0 and $1,353, respectively | 0 | 1,096 | |
Total stockholders’ equity | 163,858 | 156,489 | |
Total liabilities and stockholders’ equity | $ 669,599 | $ 783,587 | |
[1] | These balances include certain assets and liabilities of variable interest entities (“VIEs”) that can only be used to settle the liabilities of that respective VIE. All assets of the Company are pledged as security for the Company’s outstanding debt, including debt held by the VIEs. For further information regarding the assets and liabilities included in the Company's consolidated accounts, see Note 4— Variable Interest Entities. |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Loans receivable, allowance for credit loss | $ 48,399 | $ 79,912 |
Preferred stock, par value (in usd per share) | $ 0.0004 | $ 0.0004 |
Preferred stock, shares authorized (in shares) | 24,500,000 | 24,500,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in usd per share) | $ 0.0004 | $ 0.0004 |
Common stock, shares authorized (in shares) | 300,000,000 | 300,000,000 |
Common stock, shares issued (in shares) | 44,960,438 | 44,445,736 |
Common stock, shares outstanding (in shares) | 37,954,138 | 43,676,826 |
Treasury stock shares (in shares) | 7,006,300 | 768,910 |
Accumulated other comprehensive income, tax benefit | $ 0 | $ 1,353 |
CONSOLIDATED INCOME STATEMENTS
CONSOLIDATED INCOME STATEMENTS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Statement [Abstract] | |||
Revenues | $ 465,346 | $ 638,873 | $ 663,716 |
Cost of sales: | |||
Provision for loan losses | 156,910 | 325,662 | 362,198 |
Direct marketing costs | 20,282 | 38,548 | 54,723 |
Other cost of sales | 8,124 | 10,083 | 12,140 |
Total cost of sales | 185,316 | 374,293 | 429,061 |
Gross profit | 280,030 | 264,580 | 234,655 |
Operating expenses: | |||
Compensation and benefits | 84,103 | 89,417 | 80,858 |
Professional services | 31,634 | 31,834 | 29,824 |
Selling and marketing | 3,450 | 4,773 | 6,194 |
Occupancy and equipment (See Note 16) | 18,840 | 15,989 | 13,814 |
Depreciation and amortization | 18,133 | 15,879 | 11,476 |
Other | 3,659 | 5,119 | 4,717 |
Total operating expenses | 159,819 | 163,011 | 146,883 |
Operating income | 120,211 | 101,569 | 87,772 |
Other expense: | |||
Net interest expense (See Note 16) | (49,020) | (62,533) | (73,298) |
Non-operating loss | (24,079) | (681) | (350) |
Total other expense | (73,099) | (63,214) | (73,648) |
Income from continuing operations before taxes | 47,112 | 38,355 | 14,124 |
Income tax expense | 10,910 | 12,159 | 374 |
Net income from continuing operations | 36,202 | 26,196 | 13,750 |
Net income (loss) from discontinued operations | (15,610) | 5,987 | (1,241) |
Net income (loss) | $ 20,592 | $ 32,183 | $ 12,509 |
Basic earnings per share: | |||
Continuing operations (in usd per share) | $ 0.88 | $ 0.60 | $ 0.32 |
Discontinued operations (in usd per share) | (0.38) | 0.13 | (0.03) |
Basic earnings (loss) per share (in usd per share) | 0.50 | 0.73 | 0.29 |
Diluted earnings per share: | |||
Continuing operations (in usd per share) | 0.87 | 0.59 | 0.31 |
Discontinued operations (in usd per share) | (0.38) | 0.14 | (0.03) |
Diluted earnings (loss) per share (in usd per share) | $ 0.49 | $ 0.73 | $ 0.28 |
Basic weighted-average shares outstanding (in shares) | 40,926,581 | 43,805,845 | 42,791,061 |
Diluted weighted-average shares outstanding (in shares) | 41,761,623 | 44,338,205 | 44,299,304 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 20,592 | $ 32,183 | $ 12,509 |
Other comprehensive income (loss), net of tax: | |||
Foreign currency translation adjustment, net of tax of $(14), $(1) and $0, respectively | (2,061) | 1,250 | (1,237) |
Reclassification of Cumulative translation adjustment to Net loss from discontinued operations | 2,334 | 0 | 0 |
Reversal of Deferred tax asset associated with Cumulative translation adjustment | (1,369) | 0 | 0 |
Reclassification of certain deferred tax effects | 0 | 0 | (920) |
Change in derivative valuation, net of tax of $0, $(95) and $95, respectively | 0 | (208) | 208 |
Total other comprehensive income (loss), net of tax | (1,096) | 1,042 | (1,949) |
Total comprehensive income | $ 19,496 | $ 33,225 | $ 10,560 |
CONSOLIDATED STATEMENTS OF CO_2
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | |||
Foreign currency translation adjustment, tax expense (benefit) | $ (14) | $ (1) | $ 0 |
Change in derivative valuation, tax expense (benefit) | $ 0 | $ (95) | $ 95 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Restricted Stock Units (RSUs) | Employee Stock Option | Employee Stock | UNITED STATES | UNITED KINGDOM | Preferred Stock | Common Stock | Common StockRestricted Stock Units (RSUs) | Common StockEmployee Stock Option | Common StockEmployee Stock | Additional paid-in capital | Additional paid-in capitalRestricted Stock Units (RSUs) | Additional paid-in capitalEmployee Stock Option | Additional paid-in capitalUNITED STATES | Additional paid-in capitalUNITED KINGDOM | Treasury Stock | Treasury StockRestricted Stock Units (RSUs) | Treasury StockEmployee Stock Option | Treasury StockEmployee Stock | Accumulated deficit | Accumulated deficitRestricted Stock Units (RSUs) | Accumulated deficitEmployee Stock Option | Accumulated deficitEmployee Stock | Accumulated other comprehensive income |
Balance at beginning (in shares) at Dec. 31, 2017 | 0 | 42,165,524 | 0 | ||||||||||||||||||||||
Balance at beginning at Dec. 31, 2017 | $ 96,156 | $ 0 | $ 17 | $ 174,090 | $ 0 | $ (79,954) | $ 2,003 | ||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||||||||||||
Share-based compensation | $ 8,175 | $ 58 | $ 8,175 | $ 58 | |||||||||||||||||||||
Exercise of stock options (in shares) | 271,891 | ||||||||||||||||||||||||
Exercise of stock options | 997 | 997 | |||||||||||||||||||||||
Vesting of restricted stock units (in shares) | 715,492 | ||||||||||||||||||||||||
Vesting of restricted stock units | (245) | $ 1 | (246) | ||||||||||||||||||||||
ESPP shares granted (in shares) | 176,355 | ||||||||||||||||||||||||
ESPP shares granted | 844 | 844 | |||||||||||||||||||||||
Tax expense of equity issuance costs | (674) | (674) | |||||||||||||||||||||||
Comprehensive income (loss): | |||||||||||||||||||||||||
Foreign currency translation adjustment, net of tax effect | (1,237) | (1,237) | |||||||||||||||||||||||
Change in derivative valuation, net of tax expense | 208 | 208 | |||||||||||||||||||||||
Reclassification of certain deferred tax effects | 0 | 920 | (920) | ||||||||||||||||||||||
Net income from continuing operations | 13,750 | 13,750 | |||||||||||||||||||||||
Net income (loss) from discontinued operations | (1,241) | (1,241) | |||||||||||||||||||||||
Balance at ending (in shares) at Dec. 31, 2018 | 0 | 43,329,262 | 0 | ||||||||||||||||||||||
Balance at ending at Dec. 31, 2018 | 116,791 | $ 0 | $ 18 | 183,244 | $ 0 | (66,525) | 54 | ||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||||||||||||
Share-based compensation | 9,875 | 65 | 9,875 | 65 | |||||||||||||||||||||
Exercise of stock options (in shares) | 37,760 | ||||||||||||||||||||||||
Exercise of stock options | 122 | 122 | |||||||||||||||||||||||
Vesting of restricted stock units (in shares) | 751,443 | ||||||||||||||||||||||||
Vesting of restricted stock units | (1,392) | $ 0 | (1,392) | ||||||||||||||||||||||
ESPP shares granted (in shares) | 327,271 | ||||||||||||||||||||||||
ESPP shares granted | 1,149 | 1,149 | |||||||||||||||||||||||
Tax expense of equity issuance costs | (2) | (2) | |||||||||||||||||||||||
Comprehensive income (loss): | |||||||||||||||||||||||||
Foreign currency translation adjustment, net of tax effect | 1,250 | 1,250 | |||||||||||||||||||||||
Change in derivative valuation, net of tax expense | (208) | (208) | |||||||||||||||||||||||
Treasury stock acquired (in shares) | 768,910 | 768,910 | |||||||||||||||||||||||
Treasury stock acquired | (3,344) | $ (3,344) | |||||||||||||||||||||||
Net income from continuing operations | 26,196 | 26,196 | |||||||||||||||||||||||
Net income (loss) from discontinued operations | 5,987 | 5,987 | |||||||||||||||||||||||
Balance at ending (in shares) at Dec. 31, 2019 | 0 | 43,676,826 | 768,910 | ||||||||||||||||||||||
Balance at ending at Dec. 31, 2019 | $ 156,489 | $ 0 | $ 18 | 193,061 | $ (3,344) | (34,342) | 1,096 | ||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||||||||||||
Share-based compensation | $ 8,110 | $ 45 | $ 8,110 | $ 45 | |||||||||||||||||||||
Exercise of stock options (in shares) | 712,500 | 34,185 | |||||||||||||||||||||||
Exercise of stock options | $ (51) | (51) | |||||||||||||||||||||||
Vesting of restricted stock units (in shares) | 199,933 | ||||||||||||||||||||||||
Vesting of restricted stock units | (36) | (36) | |||||||||||||||||||||||
ESPP shares granted (in shares) | 280,584 | ||||||||||||||||||||||||
ESPP shares granted | 353 | 353 | |||||||||||||||||||||||
Comprehensive income (loss): | |||||||||||||||||||||||||
Foreign currency translation adjustment, net of tax effect | (2,061) | (2,061) | |||||||||||||||||||||||
Reclassification to net loss from discontinued operations net of tax of $1,369 | 965 | 965 | |||||||||||||||||||||||
Treasury stock acquired (in shares) | 7,694,896 | 7,694,896 | |||||||||||||||||||||||
Treasury stock acquired | (19,819) | $ (19,819) | |||||||||||||||||||||||
Treasury stock reissued for Vesting of restricted stock units (in shares) | 1,042,920 | 166,395 | 248,191 | 1,042,920 | 166,395 | 248,191 | |||||||||||||||||||
Treasury stock reissued for Vesting of restricted stock units | $ (751) | $ (298) | $ 320 | $ (751) | $ (298) | $ 4,574 | $ 755 | $ 1,342 | $ (4,574) | $ (755) | $ (1,022) | ||||||||||||||
Net income from continuing operations | 36,202 | 36,202 | |||||||||||||||||||||||
Net income (loss) from discontinued operations | (15,610) | (15,610) | |||||||||||||||||||||||
Balance at ending (in shares) at Dec. 31, 2020 | 0 | 37,954,138 | 7,006,300 | ||||||||||||||||||||||
Balance at ending at Dec. 31, 2020 | $ 163,858 | $ 0 | $ 18 | $ 200,433 | $ (16,492) | $ (20,101) | $ 0 |
CONSOLIDATED STATEMENTS OF ST_2
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Statement of Stockholders' Equity [Abstract] | |||
Foreign currency translation adjustment, tax expense (benefit) | $ (14) | $ (1) | $ 0 |
Change in derivative valuation, tax expense (benefit) | 0 | (95) | 95 |
Reclassification of net loss from discontinued operations, tax benefit | $ 1,369 | $ 0 | $ 0 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||
Net income (loss) | $ 20,592 | $ 32,183 | $ 12,509 | ||
Less: Net income (loss) from discontinued operations, net of tax | (15,610) | 5,987 | (1,241) | ||
Net income from continuing operations | 36,202 | 26,196 | 13,750 | ||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||
Depreciation and amortization | 18,133 | 15,879 | 11,476 | ||
Provision for loan losses | 156,910 | 325,662 | 362,198 | ||
Share-based compensation | 8,110 | 9,875 | 8,175 | ||
Amortization of debt issuance costs | 718 | 621 | 360 | ||
Amortization of loan premium | 4,600 | 5,998 | 6,179 | ||
Amortization of convertible note discount | 0 | 0 | 138 | ||
Amortization of derivative assets | 0 | 108 | 1,259 | ||
Amortization of operating leases | (529) | 4 | 0 | ||
Deferred income tax expense, net | 11,260 | 11,583 | 228 | ||
Non-operating loss | 24,079 | 681 | 350 | ||
Changes in operating assets and liabilities: | |||||
Prepaid expenses and other assets | (3,787) | 188 | (939) | ||
Income taxes payable | 465 | 0 | 0 | ||
Receivables from payment processors | 2,533 | 10,639 | (895) | ||
Receivables from CSO lenders | 7,441 | 7,487 | 6,896 | ||
Interest receivable | (38,248) | (76,274) | (89,523) | ||
State and other taxes payable | (91) | 116 | (121) | ||
Deferred revenue | (8,208) | (11,434) | 5,819 | ||
Accounts payable and accrued liabilities | (9,525) | 5,987 | 674 | ||
Net cash provided by continuing operating activities | 210,063 | 333,316 | 326,024 | ||
Net cash provided by discontinued operating activities | 1,286 | 37,028 | 36,252 | ||
Net cash provided by operating activities | 211,349 | 370,344 | 362,276 | ||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||
Loans receivable originated or participations purchased | (607,151) | (1,054,038) | (1,071,556) | ||
Principal collections and recoveries on loans receivable | 652,688 | 769,802 | 751,887 | ||
Participation premium paid | (3,828) | (5,861) | (6,393) | ||
Purchases of property and equipment | (16,069) | (17,745) | (21,241) | ||
Net cash provided by (used in) continuing investing activities | 25,640 | (307,842) | (347,303) | ||
Net cash provided by (used in) discontinued investing activities | 9,457 | (19,679) | (44,515) | ||
Net cash provided by (used in) investing activities | 35,097 | (327,521) | (391,818) | ||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||
Proceeds from notes payable | 31,500 | 64,000 | 41,000 | ||
Payments on notes payable | (119,000) | (60,000) | 0 | ||
Cash paid for interest rate caps | 0 | 0 | (1,367) | ||
Settlement of derivative liability | 0 | 0 | (2,010) | ||
Debt issuance costs paid | (253) | (2,593) | (173) | ||
Debt prepayment penalties paid | 0 | (850) | 0 | ||
ESPP shares issued | 674 | 1,149 | 844 | ||
Common stock repurchased | (19,819) | (3,344) | 0 | ||
Proceeds from stock award exercises | 27 | 122 | 997 | ||
Taxes paid related to net share settlement of equity awards | (1,164) | (1,391) | (246) | ||
Net cash provided by (used in) continuing financing activities | (108,035) | (2,907) | 39,045 | ||
Net cash provided by (used in) discontinued financing activities | (16,310) | (10,013) | 8,797 | ||
Net cash provided by (used in) financing activities | (124,345) | (12,920) | 47,842 | ||
Net increase in cash and cash equivalents | 122,101 | 29,903 | 18,300 | ||
Less: increase (decrease) in cash, cash equivalents and restricted cash from discontinued operations | (5,567) | 7,336 | 534 | ||
Change in cash, cash equivalents and restricted cash from continuing operations | 127,668 | 22,567 | 17,766 | ||
Cash and cash equivalents, beginning of period | 71,215 | [1] | 48,348 | 31,582 | |
Restricted cash, beginning of period | 2,235 | 2,535 | 1,535 | ||
Cash, cash equivalents and restricted cash, beginning of period | 73,450 | 50,883 | 33,117 | ||
Cash and cash equivalents, end of period | 197,983 | [1] | 71,215 | [1] | 48,348 |
Restricted cash, end of period | 3,135 | 2,235 | 2,535 | ||
Cash, cash equivalents and restricted cash, end of period | 201,118 | 73,450 | 50,883 | ||
Supplemental cash flow information: | |||||
Interest paid | 49,257 | 61,893 | 73,257 | ||
Taxes paid | 419 | 535 | 359 | ||
Non-cash activities: | |||||
CSO fees charged-off included in Deferred revenues and Loans receivable | 806 | 4,754 | 10,605 | ||
CSO fees on loans paid-off prior to maturity included in Receivable from CSO lenders and Deferred revenue | 47 | 181 | 268 | ||
Annual membership fee included in Deferred revenues and Loans receivable | 108 | 195 | 0 | ||
Reissuances of Treasury stock | 6,671 | 0 | 0 | ||
Property and equipment accrued but not yet paid | 0 | 579 | 445 | ||
Impact on OCI and retained earnings of adoption of ASU 2018-02 | 0 | 0 | 920 | ||
Changes in fair value of interest rate caps | 0 | 304 | 304 | ||
Tax benefit of equity issuance costs included in Additional paid-in capital | 0 | 2 | 674 | ||
Impact of deferred tax asset included in Other comprehensive income (loss) | 1,354 | 36 | 0 | ||
Leasehold improvements included in Accounts payable and accrued liabilities | 0 | 0 | 2,717 | ||
Leasehold improvements allowance included in Property and equipment, net | 0 | 439 | 0 | ||
Lease incentives allowance included in Accounts payable and accrued expenses | 0 | 3,720 | 0 | ||
Operating lease right of use assets recognized | 0 | 11,809 | 0 | ||
Operating lease liabilities recognized | $ 0 | $ 15,966 | $ 0 | ||
[1] | These balances include certain assets and liabilities of variable interest entities (“VIEs”) that can only be used to settle the liabilities of that respective VIE. All assets of the Company are pledged as security for the Company’s outstanding debt, including debt held by the VIEs. For further information regarding the assets and liabilities included in the Company's consolidated accounts, see Note 4— Variable Interest Entities. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of Significant Accounting Policies | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Company’s accounting and reporting policies are in accordance with accounting principles generally accepted in the United States (“US GAAP”) and conform, as applicable, to general practices within the finance company industry. The following is a description of the more significant of these policies used in preparing the consolidated financial statements. Business Operations Elevate Credit, Inc. (the “Company”) is a Delaware corporation. The Company provides technology-driven, progressive online credit solutions to non-prime consumers. The Company uses advanced technology and proprietary risk analytics to provide more convenient and more responsible financial options to its customers, who are not well-served by either banks or legacy non-prime lenders. The Company currently offers unsecured online installment loans, lines of credit and credit cards in the United States (the “US”). The Company’s products, Rise, Elastic and Today Card, reflect its mission of “Good Today, Better Tomorrow” and provide customers with access to competitively priced credit and services while helping them build a brighter financial future with credit building and financial wellness features. In the United Kingdom ("UK"), the Company previously offered unsecured installment loans via the internet through its wholly owned subsidiary, Elevate Credit International Limited, (“ECIL”) under the brand name of Sunny. On June 29, 2020, ECIL entered into administration in accordance with the provisions of the UK Insolvency Act 1986 and pursuant to a resolution of the board of directors of ECIL. The onset of Coronavirus Disease 2019 ("COVID-19") coupled with the lack of clarity within the UK regulatory environment led to the decision to place ECIL into administration. The management, business, affairs and property of ECIL have been placed into the direct control of the appointed administrators, KPMG LLP. Accordingly, the Company deconsolidated ECIL as of June 29, 2020 and presents ECIL's results as discontinued operations for all periods presented. See Note 15—Discontinued Operations for more information regarding the presentation of ECIL. Basis of Presentation The consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries and variable interest entities ("VIEs") where the Company is the primary beneficiary. All significant intercompany transactions and accounts have been eliminated. Reclassifications Certain amounts in the prior periods presented herein have been reclassified to conform to the current period financial statement presentation. The Company does not believe that these reclassifications have a material impact on the consolidated financial statements. The Company reclassified $605 thousand to Accounts payable and accrued liabilities with an offset to Income taxes payable related to December 31, 2019 state and other taxes payable. Use of Estimates The preparation of the consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant items subject to such estimates and assumptions include the valuation of the allowance for loan losses, goodwill, long-lived and intangible assets, deferred revenues, contingencies, the fair value of derivatives, the income tax provision, valuation of share-based compensation, operating lease right of use assets, operating lease liabilities and the valuation allowance against deferred tax assets. The Company bases its estimates on historical experience, current data and assumptions that are believed to be reasonable. Actual results in future periods could differ from those estimates. Cash and Cash Equivalents The Company considers all highly-liquid investments purchased with an original maturity of three months or less to be cash equivalents. Restricted Cash Amounts restricted under lending agreements, third-party processing agreements and state licensing requirements are classified separately as restricted cash. Installment Loans, Lines of Credit and Credit Cards Installment loans, lines of credit and credit cards, including receivables for finance charges, fees and interest, are unsecured and reported as Loans receivable, net of allowance for loan losses on the Consolidated Balance Sheets. Installment loans are multi-payment loans that require the pay-down of portions of the outstanding principal balance in multiple installments through the Rise brand. Line of credit accounts include customer cash advances made through the Elastic brand and the Rise brand in two states (which were discontinued in September 2020). Credit cards represent credit card receivable balances, uncollected billed interest and fees through the Today Card brand. The Company offers Rise installment products directly to customers. Elastic lines of credit, Rise bank-originated installment loans and Today credit card receivables represent participation interests acquired from third-party lenders through a wholly owned subsidiary or by a VIE. Based on agreements with the third-party lenders, the VIEs pay a loan premium on the participation interests purchased. The loan premium is amortized over the expected life of the outstanding loan amount. At December 31, 2020, 2019 and 2018, the amortization expenses on the loan premiums were $4.6 million, $6.0 million and $6.2 million, respectively, and are included within Revenues in the Consolidated Income Statements. See Note 4—Variable Interest Entities for more information regarding these participation interests in Rise and Elastic receivables. The Company considers impaired loans as accounts over 60 days past due (for installment loans and lines of credit) or 120 days (for credit cards) or loans which become uncollectible based on information that the Company becomes aware of (e.g., receipt of customer bankruptcy notice). The impaired loans are charged-off at the time that they are deemed to be uncollectible. A modification of finance receivable terms is considered a troubled debt restructuring ("TDR") if the borrower is experiencing financial difficulty and the Company grants a concession it would not otherwise have considered to a borrower. The Company considers TDRs to include all installment and line of credit loans that were modified by granting principal and interest forgiveness or by extension of the maturity date greater than 60 days as a part of a loss mitigation strategy. On March 22, 2020, federal and state banking regulators issued a joint statement on working with customers affected by COVID-19 (the "Interagency Statement"). The Interagency Statement includes guidance on accounting for loan modifications. In accordance with the Interagency Statement, the Company, and the bank originators the Company supports, have elected to not recognize modified loans as TDRs if the borrower was both: 1) not more than 30 days past due as of March 1, 2020 (or at the requested modification date if originated on or after March 2, 2020); and 2) the modification stems from the effects of the COVID-19 outbreak. The modifications offered by the Company to borrowers that meet both qualifications may include short-term payment deferrals less than six months, interest or fee waivers, extensions of payment terms or delays in payment that are insignificant. If the borrower was not current at March 1, 2020, the Company offers similar modifications that are considered TDRs. This election is applicable from March 1, 2020 until the earlier of 60 days following the date the COVID-19 national emergency comes to an end or January 1, 2022. Allowance for Loan Losses The Company has adopted Financial Accounting Standards Board (“FASB”) guidance for disclosures about the credit quality of financing receivables and the allowance for loan losses (“allowance”). The Company maintains an allowance for loan losses for loans and interest receivable for loans not classified as TDRs at a level estimated to be adequate to absorb credit losses inherent in the outstanding loans receivable. The Company primarily utilizes historical loss rates by product, stratified by delinquency ranges, to determine the allowance, but also considers recent collection and delinquency trends, as well as macro-economic conditions that may affect portfolio losses. Additionally, due to the uncertainty of economic conditions and cash flow resources of the Company’s customers, the estimate of the allowance for loan losses is subject to change in the near-term and could significantly impact the consolidated financial statements. If a loan is deemed to be uncollectible before it is fully reserved, it is charged-off at that time. For loans classified as TDRs, impairment is typically measured based on the present value of the expected future cash flows discounted at the original effective interest rate. The Company classifies its loans as either current or past due. An installment loan or line of credit customer in good standing may request a 16-day grace period when or before a payment becomes due and, if granted, the loan is considered current during the grace period. Credit card customers have a 25-day grace period for each payment. Installment loans and lines of credit are considered past due if a grace period has not been requested and a scheduled payment is not paid on its due date. Credit cards are considered past due if the grace period has passed and the scheduled payment has not been made. Increases in the allowance are created by recording a Provision for loan losses in the Consolidated Income Statements. Installment loans and lines of credit are charged off, which reduces the allowance for loan losses, when they are over 60 days past due or earlier if deemed uncollectible. Credit cards are charged off, which reduces the allowance for loan losses, when they are over 120 days past due or earlier if deemed uncollectible. Recoveries on losses previously charged to the allowance are credited to the allowance when collected. Revenue Recognition The Company recognizes consumer loan fees as revenues for each of the loan products it offers. Revenues on the Consolidated Income Statements include: finance charges, lines of credit fees, fees for services provided through CSO programs (“CSO fees”), and interest, as well as any other fees or charges permitted by applicable laws and pursuant to the agreement with the borrower. Other revenues also include marketing and licensing fees received from the originating lender related to the Elastic product and Rise bank-originated loans and from CSO fees related to the Rise product. Revenues related to these fees are recognized when the service is performed. The Company accrues finance charges on installment loans on a constant yield basis over their terms. The Company accrues and defers fixed fees such as CSO fees and lines of credit fees when they are assessed and recognizes them to earnings as they are earned over the life of the loan. The Company accrues interest on credit cards based on the amount of the credit card balance outstanding and the related contractual interest rate. Credit card membership fees are amortized to revenue over the card membership period. Other credit card fees, such as late payment fees and returned payment fees, are accrued when assessed. The Company does not accrue finance charges and other fees on installment loans or lines of credit for which payment is greater than 60 days past due. Credit card interest charges are recognized based on the contractual provisions of the underlying arrangements and are not accrued when payment is past due more than 90 days. Installment loans and lines of credit are considered past due if a grace period has not been requested and a scheduled payment is not paid on its due date. Credit cards have a grace period of 25 days and are considered delinquent after the grace period. Payments received on past due loans are applied against the loan and accrued interest balance to bring the loan current. Payments are generally first applied to accrued fees and interest and then to the principal loan balance. The spread of COVID-19 since March 2020 has created a global public health crisis that has resulted in unprecedented disruption to businesses and economies. In response to the pandemic's effects, and in accordance with federal and state guidelines, the Company expanded its payment flexibility programs for its customers, including payment deferrals. This program allows for a deferral of payments for an initial period of 30 to 60 days, and generally up to a maximum of 180 days on a cumulative basis. A customer will return to the normal payment schedule after the end of the deferral period with the extension of the maturity date equivalent to the deferral period, which is generally not to exceed an additional 180 days. The finance charges will continue to accrue at a lower effective interest rate over the expected term of the loan as adjusted for the deferral period provided (not to exceed an amount greater than the amount at which the borrower could settle the loan) or placed on non-accrual status. The Company’s business is affected by seasonality, which can cause significant changes in portfolio size and profit margins from quarter to quarter. Although this seasonality does not impact the Company’s policies for revenue recognition, it does generally impact the Company’s results of operations by potentially causing an increase in its profit margins in the first quarter of the year and decreased profit margins in the second through fourth quarters. Credit Service Organization The Company also provides services in connection with installment loans originated by independent third-party lenders (“CSO lenders”), whereby the Company acts as a credit services organization/credit access business on behalf of consumers in accordance with applicable state laws (the “CSO program”). Previously, the CSO program included arranging loans with CSO lenders, assisting in the loan application, documentation and servicing processes. As of December 31, 2020, the CSO lenders are no longer originating Rise CSO loans. The Company continues to service existing loans. Under the CSO program, the Company guarantees the repayment of the customer’s loan to the CSO lenders as part of the credit services it provides to the customer. A customer who obtained a loan through the CSO program paid the Company a fee for the credit services, including the guaranty, and entered into a contract with the CSO lenders governing the credit services arrangement. The CSO fee received was initially recognized as deferred revenue and subsequently recognized over the life of the loan. The Company estimates a liability for losses associated with the guaranty provided to the CSO lenders using assumptions and methodologies similar to the allowance for loan losses detailed previously. The CSO program required that the Company fund a cash reserve equal to 25% - 45% of the outstanding loan principal within the CSO program portfolio. As of December 31, 2020 and 2019, respectively, estimated losses of approximately $0.7 million and $2.1 million for the CSO loans receivable guaranteed by the Company of approximately $2.2 million and $19.6 million, respectively, are initially recorded at fair value and are included in Accounts payable and accrued liabilities in the Consolidated Balance Sheets. See Note 3—Loans Receivable and Revenues for additional information on loans receivable and the provision for loan losses. The Company also had a Receivable from CSO lenders related primarily to CSO fees received by the CSO lenders from customers. The receivables (payables) related to the CSO lenders as of December 31, 2020 and 2019 are as follows: (Dollars in thousands) 2020 2019 Receivable related to 25%-45% cash reserve $ 1,333 $ 8,648 Receivable (payable) related to CSO fees collected by CSO lenders (78) (9) Receivable related to licensing and servicing arrangements with CSO lenders 0 57 Total receivable from CSO lenders $ 1,255 $ 8,696 The CSO lenders are considered VIEs of the Company; however, the Company does not have any ownership interest in the CSO lenders, does not exercise control over them, and is not the primary beneficiary, and therefore, does not consolidate the CSO lenders’ results with its results. Receivables from Payment Processors The Company has entered into agreements with third-party service providers to conduct processing activities, including the funding of new customer loans and the collection of customer payments for those loans. In accordance with contractual agreements, these funds are settled back to the Company within one to three business days after the date of the originating transaction. Accordingly, the Company had approximately $6.1 million and $8.7 million due from processing providers as of December 31, 2020 and 2019, respectively, which is included in Receivable from payment processors in the Consolidated Balance Sheets. Direct Marketing Costs Marketing expenses consist of online marketing costs such as sponsored search and advertising on social networking sites, and other marketing costs such as purchased television and radio advertising and direct mail print advertising. In addition, marketing expense includes affiliate costs paid to marketers in exchange for information for applications from potential customers. Online marketing, affiliate costs and other marketing costs are expensed as incurred. Selling and Marketing Costs Selling and marketing costs include costs associated with the use of agencies that perform creative services and monitor and measure the performance of the various marketing channels. Selling and marketing costs also include the production costs associated with media advertisements that are expensed as incurred over the licensing or production period. Operating Segments The Company determines operating segments based on how its chief operating decision-maker manages the business, including making operating decisions, deciding how to allocate resources and evaluating operating performance. The Company's chief operating decision-maker is its Chief Executive Officer, who reviews the Company's operating results monthly on a consolidated basis. The Company has one reportable segment, which provides online financial services for non-prime consumers. The Company has aggregated all components of its business into a single reportable segment based on the similarities of the economic characteristics, the nature of the products and services, the distribution methods, the type of customers and the nature of the regulatory environments. With the disposal of ECIL, all of the Company's assets and revenue are in one geographic location, therefore, segment reporting based on geography has been discontinued. Property and Equipment, net Property and equipment are stated at cost, net of accumulated depreciation and amortization. The Company capitalizes all acquisitions of property and equipment of $500 or greater. The Company capitalizes certain software development costs. Costs incurred in the preliminary stages of development are expensed, but software development costs incurred thereafter, including external direct costs of materials and services as well as payroll and payroll-related costs, are capitalized. Software development costs, which are included in Property and equipment, net on the Consolidated Balance Sheets, as of December 31, 2020 and 2019, and related amortization expense, which is included in Depreciation and amortization within the Consolidated Income Statements for the years ended December 31, 2020 and 2019 were as follows: (Dollars in thousands) 2020 2019 Software development costs $ 79,200 $ 64,196 Less: accumulated amortization (53,265) (39,036) Net book value $ 25,935 $ 25,160 Amortization expense $ 14,229 $ 9,961 Maintenance and repairs that do not extend the useful life of the assets are expensed as incurred. Depreciation and amortization are computed using the straight-line method over the estimated useful lives of the depreciable or amortizable assets as follows: Furniture and fixtures 7 years Equipment 3-5 years Leasehold improvements The lesser of the related lease term or useful life of 3-5 years Software and software development 3 years Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences and benefits attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts that are more likely than not to be realized. Relative to uncertain tax positions, the Company accrues for losses it believes are probable and can be reasonably estimated. The amount recognized is subject to estimate and management judgment with respect to the likely outcome of each uncertain tax position. The amount that is ultimately sustained for an individual uncertain tax position or for all uncertain tax positions in the aggregate could differ from the amount recognized. If the amounts recorded are not realized or if penalties and interest are incurred, the Company has elected to record all amounts within income tax expense. The Company has no recorded liabilities for uncertain tax positions at December 31, 2020 and 2019. Tax periods from fiscal years 2014-2019 remain open and subject to examination for US federal and state tax purposes. As the Company had no operations nor had filed US federal tax returns prior to May 1, 2014, there are no other US federal or state tax years subject to examination. The Coronavirus Aid, Relief, and Economic Security ("CARES Act"), as amended by the Consolidated Appropriations Act ("CAA") were signed into law on March 27, 2020 and December 27, 2020, respectively. The Company reviewed the tax relief provisions of the CARES Act, amended, regarding its eligibility and determined that the impact is likely to be insignificant with regard to its effective tax rate. The Company continues to monitor and evaluate its eligibility for the amended CARES Act tax relief provisions to identify any portions that may become applicable in the future. Goodwill and Indefinite Lived Intangible Assets Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired in each business combination. In accordance with Accounting Standards Codification ("ASC") 350-20-35, Goodwill—Subsequent Measurement , the Company performs a quantitative approach method impairment review of goodwill and intangible assets with an indefinite life annually at October 1 and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Prior to 2019, the Company performed this test at October 31. As a result of the global economic impact and uncertainty due to COVID-19, the Company concluded a triggering event had occurred as of March 31, 2020, and accordingly, performed interim impairment testing on the goodwill balances of its reporting units. The Company performed a detailed qualitative and quantitative assessment of each reporting unit and concluded that the goodwill associated with the previously consolidated UK reporting unit was impaired as the fair value of the UK reporting unit was less than the carrying amount. The impairment loss of $9.3 million is included in Loss from discontinued operations due to the deconsolidation of ECIL. While there was a decline in the fair value of the Elastic reporting unit at March 31, 2020, there was no impairment identified during the quantitative assessment. The Company completed its annual test as of October 1, 2020 and determined that there was no evidence of impairment of goodwill or indefinite lived intangible assets. No events or circumstances occurred between October 1 and December 31, 2020 that would more likely than not reduce the fair value of the Elastic reporting unit below the carrying amount. Prior to the adoption of ASU No. 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment ("ASU 2017-04"), the Company’s impairment evaluation of goodwill was already based on comparing the fair value of the Company’s reporting units to their carrying value. The adoption of ASU 2017-04 as of January 1, 2020 had no impact on the Company's evaluation procedures. The fair value of the reporting units is determined based on a weighted average of the income and market approaches. The income approach establishes fair value based on estimated future cash flows of the reporting units, discounted by an estimated weighted-average cost of capital developed using the capital asset pricing model, which reflects the overall level of inherent risk of the reporting units. The income approach uses the Company’s projections of financial performance for a six Intangible Assets Subject to Amortization Intangible assets primarily include the fair value assigned to non-compete agreements at acquisition less any accumulated amortization. Non-compete agreements are amortized on a straight-line basis over the term of the agreement. An evaluation of the recoverability of intangible assets subject to amortization is performed whenever the facts and circumstances indicate that the carrying value may be impaired. An impairment loss is recognized if the future undiscounted cash flows associated with the asset and the estimated fair value of the asset are less than the asset’s corresponding carrying value. The amount of the impairment loss, if any, is the excess of the asset’s carrying value over its estimated fair value. No impairment losses related to intangible assets subject to amortization occurred during the years ended December 31, 2020, 2019 and 2018. Leases Prior to the implementation of ASC Topic 842, Leases , the Company recognized escalating lease payments on a straight-line basis over the term of each respective lease with the difference between cash payments and rent expense recorded as a deferred rent liability. The Company adopted the provisions of ASC Topic 842 on a prospective basis at January 1, 2019. The adoption of ASU 2016-02, as amended, resulted in the recognition of approximately $11.5 million and $15.4 million additional right of use assets and liabilities for operating leases, respectively, of which $10.3 million and $14.2 million related to continuing operations. Subsequent to initial adoption, the Company entered into additional leases for a total recognition in 2019 of $11.8 million and $16.0 million right of use assets and liabilities for operating leases in continuing operations, respectively. The Company did not enter into any leases in 2020. The Company determines if an arrangement is a lease at inception. Operating leases are included in Operating lease right of use ("ROU") assets and Operating lease liabilities on the Company's Consolidated Balance Sheets. Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at the commencement date. As most of its leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of future payments. The operating lease ROU asset may also include initial direct costs incurred and excludes any lease payments made and lease incentives. The Company's lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components. The lease and non-lease components are accounted for as a single lease component. Debt Discount and Issuance Costs Costs incurred for issuing the Notes payable are deferred and amortized using the straight-line method over the life of the related debt, which approximates the effective interest method. These costs include any debt discount or premium on the notes in addition to debt issuance costs incurred. The unamortized balance of debt issuance costs was approximately $2.1 million and $2.6 million at December 31, 2020 and 2019, respectively, and is included in Notes payable, net in the Consolidated Balance Sheets. Amortization of debt issuance costs of approximately $0.7 million, $0.6 million and $0.4 million was recognized for the years ended December 31, 2020, 2019 and 2018, respectively, and is included within Net interest expense in the Consolidated Income Statements. Comprehensive Income Accumulated other comprehensive income, net is comprised of the impact of foreign currency translation adjustments in addition to unrealized gains (losses) on interest rate caps. The Company had the following reclassifications out of Accumulated other comprehensive income (loss), net: • For the year ended December 31, 2020, the Company reclassified a $2.3 million net loss from cumulative translation adjustments within Accumulated other comprehensive income to Net loss from discontinued operations as part of the Company's loss on disposal related to the placement of ECIL into administration. In addition, a $1.4 million deferred tax benefit was reclassified to remove the associated deferred tax asset as part of this transaction. • During the years ended December 31, 2019 and 2018, the Company and ESPV utilized interest rate caps to offset interest rate fluctuations in the Company's and ESPV's future interest payments on certain of their Notes payable. Effective gains or losses related to these cash flow hedges were reported in Accumulated other comprehensive income and reclassified into earnings, through interest expense, in the period or periods in which the hedged transactions affected earnings. The Company reclassified gains of $0.3 million and $2.4 million related to the maturation of the interest rate caps from Accumulated other comprehensive income to net income in the years ended December 31, 2019 and 2018, respectively. See Note 11— Fair Value for additional information on these cash flow hedges. For the years ended December 31, 2020, 2019 and 2018, the change in total other comprehensive income, net of tax, was a gain (loss) of approximately $(1.1) million, $1.0 million and $(1.9) million, respectively. • In 2018, certain stranded tax effects of $0.9 million were reclassified from accumulated comprehensive income to Accumulated deficit. Concentration of Credit Risk The Company maintains cash and cash equivalent balances in bank deposit accounts that, at times, may exceed federally insured limits. The Company has not experienced any losses in such accounts. The Company believes it is not exposed to any significant credit risk on cash and cash equivalents. Fair Value Measurements The Company applies the provisions of ASC Topic 820, Fair Value Measurements and Disclosures , for fair value measurements of financial and non-financial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring or non-recurring basis, as applicable. This guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (also referred to as an exit price). This guidance also establishes a framework for measuring fair value and expands disclosures about fair value measurements. See Note 11—Fair Value Measurements for additional information on fair value measurements. Derivative Financial Instruments The Company applies the provisions of ASC Topic 815, Derivatives and Hedging. On January 11, 2018, the Company and ESPV each entered into one interest rate cap transaction with |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | EARNINGS PER SHARE Basic earnings per share ("EPS") is computed by dividing net income (loss) by the weighted-average number of common shares outstanding ("WASO") during each period. Also, basic EPS includes any fully vested stock and unit awards that have not yet been issued as common stock. There are no unissued fully vested stock and unit awards at December 31, 2020 and 2019. Diluted EPS is computed by dividing net income (loss) by the WASO during each period plus any unvested stock option awards granted, vested unexercised stock options and unvested RSUs using the treasury stock method but only to the extent that these instruments dilute earnings per share. The computation of earnings (loss) per share was as follows for years ended December 31, 2020, 2019 and 2018: Years Ended December 31, (Dollars in thousands except share and per share amounts) 2020 2019 2018 Numerator (basic and diluted): Net income from continuing operations $ 36,202 $ 26,196 $ 13,750 Net income (loss) from discontinued operations (15,610) 5,987 (1,241) Net income $ 20,592 $ 32,183 $ 12,509 Denominator (basic): Basic weighted-average number of shares outstanding 40,926,581 43,805,845 42,791,061 Denominator (diluted): Basic weighted-average number of shares outstanding 40,926,581 43,805,845 42,791,061 Effect of potentially dilutive securities: Employee stock plans (options, RSUs and ESPP) 835,042 532,360 1,508,243 Diluted weighted-average number of shares outstanding 41,761,623 44,338,205 44,299,304 Basic and diluted earnings per share: Continuing operations $ 0.88 $ 0.60 $ 0.32 Discontinued operations (0.38) 0.13 (0.03) Basic earnings per share $ 0.50 $ 0.73 $ 0.29 Continuing operations $ 0.87 $ 0.59 $ 0.31 Discontinued operations (0.38) 0.14 (0.03) Diluted earnings per share $ 0.49 $ 0.73 $ 0.28 For the years ended December 31, 2020, 2019 and 2018, the Company excluded the following potential common shares from its diluted earnings per share calculation because including these shares would be anti-dilutive. • 1,360,711, 1,434,882 and 249,517 common shares issuable upon exercise of the Company's stock options • 2,483,622, 3,552,730 and 826,557 common shares issuable upon vesting of the Company's RSUs. |
Loans Receivable and Revenues
Loans Receivable and Revenues | 12 Months Ended |
Dec. 31, 2020 | |
Receivables [Abstract] | |
Loans Receivable and Revenues | LOANS RECEIVABLE AND REVENUES Revenues Revenues generated from the Company’s consumer loans for the years ended December 31, 2020, 2019 and 2018 were as follows: (Dollars in thousands) 2020 2019 2018 Finance charges $ 274,025 $ 348,537 $ 345,003 Lines of credit fees 173,528 247,398 254,561 CSO fees 16,530 40,835 60,221 Other 1,263 2,103 3,931 Total revenues $ 465,346 $ 638,873 $ 663,716 Loans receivable, net of allowance for loan losses The Company's portfolio consists of installment loans, lines of credit and credit card receivables, which are considered the portfolio segments at December 31, 2020 and 2019. The Rise product is primarily installment loans with lines of credit offered in two states, which ceased lines of credit origination activity in September 2020. The Elastic product is a line of credit product. In November of 2018, the Company launched the Today Card, a credit card product offered in the US. The following reflects the credit quality of the Company’s loans receivable as of December 31, 2020 and 2019 as delinquency status has been identified as the primary credit quality indicator. The Company classifies its loans as either current or past due. A customer in good standing may request up to a 16-day grace period when or before a payment becomes due and, if granted, the loan is considered current during the grace period. In response to the COVID-19 pandemic, the Company, along with the banks it supports, has also expanded existing payment flexibility programs to provide temporary payment relief to certain customers who meet the program’s qualifications. These programs allow for a deferral of payments for an initial period of 30 to 60 days, which the Company may extend for an additional 30 days, generally for a maximum of 180 days on a cumulative basis. A customer will return to the normal payment schedule after the end of the deferral period, with the extension of the maturity date equivalent to the deferral period, which is generally not to exceed an additional 180 days. Customers that were 30 days past due or less as of March 1, 2020 or the date the customer requested the deferral are considered current. Customers more than 30 days past due as of March 1, 2020 or the date the customer requested the deferral are considered delinquent. As of December 31, 2020, 8.7% of customers have been provided relief through a COVID-19 payment deferral program for a total of $34.6 million in loans with deferred payments primarily reported in current status. The Company believes that the allowance for loan losses is adequate to absorb the losses inherent in the total portfolio as of December 31, 2020. Installment loans, lines of credit and credit cards are considered past due if a grace period has not been requested and a scheduled payment is not paid on its due date. All impaired loans that were not accounted for as a TDR as of December 31, 2020 and 2019 have been charged off. December 31, 2020 (Dollars in thousands) Rise Elastic Today Total Current loans $ 222,937 $ 154,950 $ 12,954 $ 390,841 Past due loans 22,383 6,926 1,564 30,873 Total loans receivable 245,320 161,876 14,518 421,714 Net unamortized loan premium 239 1,278 — 1,517 Less: Allowance for loan losses (33,288) (13,201) (1,910) (48,399) Loans receivable, net $ 212,271 $ 149,953 $ 12,608 $ 374,832 December 31, 2019 (Dollars in thousands) Rise Elastic Today Total Current loans $ 307,408 $ 239,941 $ 3,439 $ 550,788 Past due loans 46,386 21,285 1,108 68,779 Total loans receivable 353,794 261,226 4,547 619,567 Net unamortized loan premium 290 2,128 — 2,418 Less: Allowance for loan losses (50,019) (28,852) (1,041) (79,912) Loans receivable, net $ 304,065 $ 234,502 $ 3,506 $ 542,073 Total loans receivable includes approximately $19.2 million and $6.1 million of loans in a non-accrual status at December 31, 2020 and 2019, respectively. Additionally, total loans receivable includes approximately $25.3 million and $33.0 million of interest receivable at December 31, 2020 and 2019, respectively. The carrying value for Loans receivable, net of the allowance for loan losses approximates the fair value due to the short-term nature of the loans receivable. The changes in the allowance for loan losses for the years ended December 31, 2020, 2019 and 2018 are as follows: December 31, 2020 (Dollars in thousands) Rise Elastic Today Total Balance beginning of year $ 52,099 $ 28,852 $ 1,041 $ 81,992 Provision for loan losses 108,105 45,988 2,817 156,910 Charge-offs (140,616) (67,300) (2,030) (209,946) Recoveries of prior charge-offs 14,380 5,661 82 20,123 Total 33,968 13,201 1,910 49,079 Accrual for CSO lender owned loans (Note 1) (680) — — (680) Balance end of year $ 33,288 $ 13,201 $ 1,910 $ 48,399 December 31, 2019 (Dollars in thousands) Rise Elastic Today Total Balance beginning of year $ 50,597 $ 36,019 $ 31 $ 86,647 Provision for loan losses 207,079 116,462 2,121 325,662 Charge-offs (226,227) (134,362) (1,122) (361,711) Recoveries of prior charge-offs 20,650 10,733 11 31,394 Total 52,099 28,852 1,041 81,992 Accrual for CSO lender owned loans (Note 1) (2,080) — — (2,080) Balance end of year $ 50,019 $ 28,852 $ 1,041 $ 79,912 December 31, 2018 (Dollars in thousands) Rise Elastic Today Total Balance beginning of year $ 55,867 $ 28,869 $ — $ 84,736 Provision for loan losses 223,298 138,869 31 362,198 Charge-offs (250,623) (142,863) — (393,486) Recoveries of prior charge-offs 22,055 11,144 — 33,199 Total 50,597 36,019 31 86,647 Accrual for CSO lender owned loans (Note 1) (4,444) — — (4,444) Balance end of year $ 46,153 $ 36,019 $ 31 $ 82,203 As of December 31, 2020 and 2019, estimated losses of approximately $0.7 million and $2.1 million, respectively, for the CSO owned loans receivable guaranteed by the Company of approximately $2.2 million and $19.6 million, respectively, are initially recorded at fair value and are included in Accounts payable and accrued liabilities in the Consolidated Balance Sheets. Troubled Debt Restructurings In certain circumstances, the Company modifies the terms of its finance receivables for borrowers experiencing financial difficulties. Modifications may include principal and interest forgiveness. A modification of finance receivable terms is considered a TDR if the Company grants a concession to a borrower for economic or legal reasons related to the borrower’s financial difficulties that would not otherwise have been considered. Management considers TDRs to include all installment and line of credit loans that were granted principal and interest forgiveness or that extended the maturity date by sixty days or more as a part of a loss mitigation strategy for Rise and Elastic, unless excluded by policy. Once a loan has been classified as a TDR, it is assessed for impairment based on the present value of expected future cash flows discounted at the loan's original effective interest rate considering all available evidence. There were no loans that were modified as TDRs prior to 2017. The following table summarizes the financial effects, excluding impacts related to credit loss allowance and impairment, of TDRs that occurred for the years ended December 31, 2020, 2019, and 2018: (Dollars in thousands) 2020 2019 2018 Outstanding recorded investment before TDR $ 30,378 $ 32,040 $ 26,683 Outstanding recorded investment after TDR 29,492 29,689 24,421 Total principal and interest forgiveness included in charge-offs within the allowance for loan loss $ 886 $ 2,351 $ 2,262 A loan that has been classified as a TDR remains so until the loan is liquidated through payoff or charge-off. The table below presents the Company's average outstanding recorded investment and interest income recognized on TDR for the years ended December 31, 2020, 2019, and 2018: (Dollars in thousands) 2020 2019 2018 Average outstanding recorded investment(1) $ 21,828 $ 15,010 $ 9,132 Interest income recognized $ 12,560 $ 11,013 $ 14,056 1. Simple average as of December 31, 2020, 2019, and 2018, respectively. The table below presents the Company’s loans modified in TDRs as of December 31, 2020 and 2019: (Dollars in thousands) 2020 2019 Current outstanding investment $ 21,261 $ 11,313 Delinquent outstanding investment 5,532 5,549 Outstanding recorded investment 26,793 16,862 Less: Impairment included in Allowance for loan losses (7,133) (3,664) Outstanding recorded investment, net of impairment $ 19,660 $ 13,198 |
Variable Interest Entities
Variable Interest Entities | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable Interest Entities | VARIABLE INTEREST ENTITIES The Company is involved with six entities that are deemed to be VIEs: Elastic SPV, Ltd., EF SPV, Ltd., EC SPV Ltd. and three Credit Services Organization ("CSO") lenders. Under ASC 810-10-15, Variable Interest Entities , a VIE is an entity that: (1) has an insufficient amount of equity investment at risk to permit the entity to finance its activities without additional subordinated financial support by other parties; (2) the equity investors are unable to make significant decisions about the entity’s activities through voting rights or similar rights; or (3) the equity investors do not have the obligation to absorb expected losses or the right to receive residual returns of the entity. The Company is required to consolidate a VIE if it is determined to be the primary beneficiary, that is, the enterprise has both (1) the power to direct the activities of a VIE that most significantly impact the entity’s economic performance and (2) the obligation to absorb losses of the entity that could potentially be significant to the VIE. The Company evaluates its relationships with VIEs to determine whether it is the primary beneficiary of a VIE at the time it becomes involved with the entity and it re-evaluates that conclusion each reporting period. Elastic SPV, Ltd. On July 1, 2015, the Company entered into several agreements with a third-party lender and Elastic SPV, Ltd. (“ESPV”), an entity formed by third-party investors for the purpose of purchasing loan participations from the third-party lender. Per the terms of the agreements, the Company provides customer acquisition services to generate loan applications submitted to the third-party lender. In addition, the Company licenses loan underwriting software and provides services to the third-party lender to evaluate the credit quality of those loan applications in accordance with the third-party lender’s credit policies. ESPV accounts for the loan participations acquired in accordance with ASC 860-10-40, Transfers and Services, Derecognition , as the lines of credit acquired meet the criteria of a participation interest. Once the third-party lender originates the loan, ESPV has the right, but not the obligation, to purchase a 90% interest in each Elastic line of credit. Victory Park Management, LLC ("VPC") entered into an agreement (the "ESPV Facility") under which it loans ESPV all funds necessary up to a maximum borrowing amount to purchase such participation interests in exchange for a fixed return (see Note 7—Notes Payable—ESPV Facility). The Company entered into a separate credit default protection agreement with ESPV whereby the Company agreed to provide credit protection to the investors in ESPV against Elastic loan losses in return for a credit premium. The Company does not hold a direct ownership interest in ESPV, however, as a result of the credit default protection agreement, ESPV was determined to be a VIE and the Company qualifies as the primary beneficiary. The following table summarizes the assets and liabilities of the VIE that are included within the Company’s Consolidated Balance Sheets at December 31, 2020 and 2019: (Dollars in thousands) 2020 2019 ASSETS Cash and cash equivalents $ 97,345 $ 26,245 Loans receivable, net of allowance for loan losses of $13,202 and $28,852, respectively 149,951 234,504 Receivable from payment processors 3,652 6,363 Total assets $ 250,948 $ 267,112 LIABILITIES AND SHAREHOLDER'S EQUITY Accounts payable and accrued liabilities ($23,337 and $7,690, respectively, eliminates upon consolidation) $ 27,663 $ 15,902 Deferred revenue 2,300 4,280 Reserve deposit liability ($23,150 and $23,150, respectively, eliminates upon consolidation) 23,150 23,150 Notes payable, net 197,835 223,780 Total liabilities and shareholder’s equity $ 250,948 $ 267,112 EF SPV, Ltd. On October 15, 2018, the Company entered into several agreements with a third-party lender and EF SPV, Ltd. (“EF SPV”), an entity formed by third-party investors for the purpose of purchasing loan participations from the third-party lender. Per the terms of the agreements, the Company provides customer acquisition services to generate loan applications submitted to the third-party lender. In addition, the Company licenses loan underwriting software and provides services to the third-party lender to evaluate the credit quality of those loan applications in accordance with the third-party lender’s credit policies. EF SPV accounts for the loan participations acquired in accordance with ASC 860-10-40, Transfers and Services, Derecognition , as the installment loans acquired meet the criteria of a participation interest. Once the third-party lender originates the loan, EF SPV has the right, but not the obligation, to purchase an interest in each Rise bank-originated installment loan. Prior to August 1, 2019, the third-party lender retained 5% of the balances and sold a 95% participation to EF SPV. On August 1, 2019, EF SPV purchased an additional 1% participation in the outstanding portfolio with the participation percentage revised going forward to 96%. VPC lends EF SPV all funds necessary up to a maximum borrowing amount to purchase such participation interests in exchange for a fixed return (see Note 7—Notes Payable—EF SPV Facility). The Company entered into a separate credit default protection agreement with EF SPV whereby the Company agreed to provide credit protection to the investors in EF SPV against the bank-originated loan losses in return for a credit premium. The Company does not hold a direct ownership interest in EF SPV, however, as a result of the credit default protection agreement, EF SPV was determined to be a VIE and the Company qualifies as the primary beneficiary. The following table summarizes the assets and liabilities of the VIE that are included within the Company’s Consolidated Balance Sheets at December 31, 2020 and 2019: (Dollars in thousands) 2020 2019 ASSETS Cash and cash equivalents $ 35,450 $ 7,541 Loans receivable, net of allowance for loan losses of $14,342 and $17,436, respectively 83,869 111,281 Receivable from payment processors ($231 and $0 eliminates upon consolidation) 713 681 Total assets $ 120,032 $ 119,503 LIABILITIES AND SHAREHOLDER'S EQUITY Accounts payable and accrued liabilities ($16,459 and $7,114, respectively, eliminates upon consolidation) $ 17,599 $ 8,576 Reserve deposit liability ($8,950 and $8,950, respectively, eliminates upon consolidation) 8,950 8,950 Notes payable, net 93,483 101,977 Total liabilities and shareholder's equity $ 120,032 $ 119,503 EC SPV, Ltd. In July 2020, the Company entered into several agreements with a third-party lender and EC SPV, Ltd. (“EC SPV”), an entity formed by third-party investors for the purpose of purchasing loan participations from the third-party lender. Per the terms of the agreements, the Company provides customer acquisition services to generate loan applications submitted to the third-party lender. In addition, the Company licenses loan underwriting software and provides services to the third-party lender to evaluate the credit quality of those loan applications in accordance with the third-party lender’s credit policies. EC SPV accounts for the loan participations acquired in accordance with ASC 860-10-40, Transfers and Services, Derecognition , as the installment loans acquired meet the criteria of a participation interest. Once the third-party lender originates the loan, EC SPV has the right to purchase an interest in each Rise bank-originated installment loan. The third-party lender retains 5% of the balances of all the loans originated and sells the remaining 95% participation to EC SPV. VPC will lend EC SPV all funds necessary up to a maximum borrowing amount to purchase such participation interests in exchange for a fixed return (see Note 7—Notes Payable—EC SPV Facility). The Company entered into a separate credit default protection agreement with EC SPV whereby the Company agreed to provide credit protection to the investors in EC SPV against Rise bank-originated loan losses in return for a credit premium. The Company does not hold a direct ownership interest in EC SPV, however, as a result of the credit default protection agreement, EC SPV was determined to be a VIE and the Company qualifies as the primary beneficiary. The following table summarizes the assets and liabilities of the VIE that are included within the Company’s Consolidated Balance Sheets at December 31, 2020: (Dollars in thousands) 2020 ASSETS Cash and cash equivalents $ 9,377 Restricted cash 1,000 Loans receivable, net of allowance for loan losses of $1,634 19,231 Receivable from payment processors ($6 eliminates upon consolidation) 211 Total assets $ 29,819 LIABILITIES AND SHAREHOLDER’S EQUITY Accounts payable and accrued liabilities ($803 eliminates upon consolidation) $ 1,541 Reserve deposit liability ($3,500 eliminates upon consolidation) 3,500 Notes payable, net 24,778 Total liabilities and shareholder’s equity $ 29,819 CSO Lenders The three CSO lenders are considered VIE's of the Company; however, the Company does not have any ownership interest in the CSO lenders, does not exercise control over them, and is not the primary beneficiary, and therefore, does not consolidate the CSO lenders’ results with its results. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | PROPERTY AND EQUIPMENT Property and equipment as of December 31, 2020 and 2019 consists of the following: (Dollars in thousands) 2020 2019 Furniture and fixtures $ 4,288 $ 4,315 Equipment 15,323 14,453 Leasehold improvements 8,310 8,301 Software development cost 79,200 64,196 Software-purchased 9,627 9,501 116,748 100,766 Less accumulated depreciation (82,748) (64,822) $ 34,000 $ 35,944 Depreciation expense was approximately $18 million, $16 million, and $11 million for the years ended December 31, 2020, 2019, and 2018, respectively. For the years ended 2019 and 2018, the Company identified internal-use software projects whose net carrying value was deemed unrecoverable, and therefore, fully impaired. In addition, the Company identified a group of furniture and fixtures that had been abandoned related to one of the Company's offices. As a result, the Company recognized impairment expenses of $681 thousand and $311 thousand in Non-operating loss within the Consolidated Income Statements for the years ended December 31, 2019 and 2018, respectively. |
Accounts Payable and Accrued Li
Accounts Payable and Accrued Liabilities | 12 Months Ended |
Dec. 31, 2020 | |
Payables and Accruals [Abstract] | |
Accounts Payable and Accrued Liabilities | ACCOUNTS PAYABLE AND ACCRUED LIABILITIES Accounts payable and accrued liabilities at December 31, 2020 and 2019 consist of the following: (Dollars in thousands) 2020 2019 Accounts payable $ 7,568 $ 10,604 Accrued compensation 15,326 15,644 Liability for losses on CSO lender-owned consumer loans 680 2,080 Interest payable 3,852 4,691 Other accrued liabilities 24,826 5,660 $ 52,252 $ 38,679 |
Notes Payable, Net
Notes Payable, Net | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Notes Payable, Net | NOTES PAYABLE, NET The Company has four debt facilities with VPC, the Rise SPV, LLC credit facility (the "VPC Facility"), the EF SPV Facility, the ESPV Facility, and effective July 31, 2020, the EC SPV Facility. The facilities had the following terms as of December 31, 2020. VPC Facility The VPC Facility is primarily used to fund the Rise loan portfolio with a subordinated debt component used for general corporate purposes. It provides the following term notes at: • A maximum borrowing amount of $200 million (amended as of July 31, 2020) used to fund the Rise loan portfolio (“US Term Note”). Prior to the February 1, 2019 amendment, the interest rate paid on this facility was a base rate (defined as the 3-month LIBOR, with a 1% floor) plus 11%. Upon the February 1, 2019 amendment date, the interest rate of the debt outstanding as of the amendment date was fixed through the January 1, 2024 maturity date at 10.23% (base rate of 2.73% plus 7.5%, which was reduced to 7.25% on January 1, 2020 as part of the amendment). At December 31, 2019, the weighted-average base rate on the outstanding balance was 2.73% and the overall interest rate was 10.23%. The weighted-average base rate on the outstanding balance at December 31, 2020 was 2.73% and the overall rate was 9.98%. All future borrowings under this facility will bear an interest rate at a base rate (defined as the greater of 3-month LIBOR, the five-year LIBOR swap rate or 1%) plus 7.25% at the borrowing date. • A maximum borrowing amount of $18 million used to fund working capital, and prior to February 1, 2019, at a base rate (defined as the 3-month LIBOR, with a 1% floor) plus 13% ("4 th Tranche Term Note"). Upon the February 1, 2019 amendment date, the interest rate was fixed through the February 1, 2021 maturity date at a base rate of 2.73% plus 13%. The interest rate at both December 31, 2020 and 2019 was 15.73%. There was no change in the interest rate spread on this facility upon the February 1, 2019 amendment. • Revolving feature providing the option to pay down up to 20% of the outstanding balance, excluding the 4 th Tranche Term note, once per year during the first quarter. Amounts paid down may be drawn again at a later date prior to maturity. As of December 31, 2020, the VPC Facility had a total borrowing capacity of $218 million. The 4 th Tranche Term Note matures on February 1, 2021. The US Term Note matures on January 1, 2024. There are no principal payments due or scheduled until the respective maturity dates. All assets of the Company are pledged as collateral to secure the VPC Facility. The VPC Facility contains certain covenants for the Company such as minimum cash requirements and a minimum book value of equity requirement. There are also certain covenants for the product portfolio underlying the facility including, among other things, excess spread requirements, maximum roll rate and charge-off rate levels and maximum loan-to-value ratios. The Company was in compliance with all covenants related to the VPC Facility as of December 31, 2020 and 2019. Prior to ECIL entering administration and being classified a discontinued operation by the Company on June 29, 2020, the VPC Facility included a note used to fund the UK Sunny loan portfolio (“UK Term Note”). Upon deconsolidation of ECIL, this note was removed from the Company's Consolidated Balance Sheets and is presented within Liabilities from discontinued operations in all prior periods presented. Under the terms of the VPC Facility, Elevate Credit, Inc. (the "Parent") had provided a guarantee to VPC for the repayment of the debt of any subsidiary, which included the outstanding debt of ECIL. Upon deconsolidation of ECIL, the Company evaluated and recognized a $566 thousand liability at the Parent level related to the guarantee of ECIL's outstanding debt balance at June 30, 2020. The liability was recognized at the fair value of the guarantee obligation based on ECIL's cash flows and ability to repay the outstanding debt balance. ECIL completed repayment of the UK Term Note in the third quarter of 2020 and the liability has been released. ESPV Facility The ESPV Facility has a maximum borrowing amount of $350 million used to purchase loan participations from a third-party lender. Prior to the February 1, 2019 amendment, the interest rate paid on this facility was a base rate (defined as the greater of the 3-month LIBOR rate or 1% per annum) plus 13% for the outstanding balance up to $50 million, plus 12% for the outstanding balance greater than $50 million up to $100 million, plus 13.5% for any amounts greater than $100 million up to $150 million, and plus 12.75% for borrowing amounts greater than $150 million. Upon the February 1, 2019 amendment date, the interest rate on the debt outstanding as of the amendment date was fixed at 15.48% (base rate of 2.73% plus 12.75%). Effective July 1, 2019, the interest rate on the debt outstanding as of the amendment date was set at 10.23% (base rate of 2.73% plus 7.5%, which was reduced to 7.25% on January 1, 2020 as part of the amendment). At December 31, 2019, the weighted-average base rate on the outstanding balance was 2.72% and the overall interest rate was 10.22%. The weighted-average base rate on the outstanding balance at December 31, 2020 was 2.72% and the overall interest rate was 9.97%. All future borrowings under this facility after July 1, 2019 will bear an interest rate at a base rate (defined as the greater of 3-month LIBOR, the five-year LIBOR swap rate or 1%) plus 7.25% at the borrowing date. The ESPV Term Note has a revolving feature providing the option to pay down up to 20% of the outstanding balance once per year during the first quarter. Amounts paid down may be drawn again at a later date prior to maturity. The ESPV Term Note matures on January 1, 2024. There are no principal payments due or scheduled until the maturity date. All assets of the Company and ESPV are pledged as collateral to secure the ESPV Facility. The ESPV Facility contains certain covenants for the Company such as minimum cash requirements and a minimum book value of equity requirement. There are also certain covenants for the product portfolio underlying the facility including, among other things, excess spread requirements, maximum roll rate and charge-off levels, and maximum loan-to-value ratios. The Company was in compliance with all covenants related to the ESPV Facility as of December 31, 2020 and 2019. EF SPV Facility The EF SPV Facility has a maximum borrowing amount of $250 million (amended as of July 31, 2020) used to purchase loan participations from a third-party lender. Prior to execution of the agreement with VPC effective February 1, 2019, EF SPV was a borrower on the US Term Note under the VPC Facility and the interest rate paid on this facility was a base rate (defined as 3-month LIBOR, with a 1% floor) plus 11%. Upon the February 1, 2019 amendment date, $43 million was re-allocated into the EF SPV Facility and the interest rate on the debt outstanding as of the amendment date was fixed through the January 1, 2024 maturity date at 10.23% (base rate of 2.73% plus 7.5%, which was reduced to 7.25% on January 1, 2020 as part of the amendment). The weighted-average base rate on the outstanding balance at December 31, 2019 was 2.49% and the overall interest rate was 9.99%. The weighted-average base rate on the outstanding balance at December 31, 2020 was 2.45% and the overall interest rate was 9.70%. All future borrowings under this facility will bear an interest rate at a base rate (defined as the greater of 3-month LIBOR, the five-year LIBOR swap rate or 1%) plus 7.25% at the borrowing date. The EF SPV Term Note has a revolving feature providing the option to pay down up to 20% of the outstanding balance once per year during the first quarter. Amounts paid down may be drawn again at a later date prior to maturity. The EF SPV Term Note matures on January 1, 2024. There are no principal payments due or scheduled until the maturity date. All assets of the Company and EF SPV are pledged as collateral to secure the EF SPV Facility. The EF SPV Facility contains certain covenants for the Company such as minimum cash requirements and a minimum book value of equity requirement. There are also certain covenants for the product portfolio underlying the facility including, among other things, excess spread requirements, maximum roll rate and charge-off rate levels, and maximum loan-to-value ratios. The Company was in compliance with all covenants related to the EF SPV Facility as of December 31, 2020 and 2019. EC SPV Facility VPC entered into a new debt facility with EC SPV on July 31, 2020. The EC SPV Facility has a maximum borrowing amount of $100 million used to purchase loan participations from a third-party lender. As of December 31, 2020, the interest rate paid on this facility is a base rate (defined as the greater of 3-month LIBOR, the five-year LIBOR swap rate or 1%) plus 7.25% at the borrowing date. The weighted-average base rate on the outstanding balance at December 31, 2020 was 2.73% and the overall interest rate was 9.98%. The EC SPV Term Note has a revolving feature providing the option to pay down up to 20% of the outstanding balance once per year during the first quarter. Amounts paid down may be drawn again at a later date prior to maturity. The EC SPV Term Note matures on January 1, 2024. There are no principal payments due or scheduled until the maturity date. All assets of the Company and EC SPV are pledged as collateral to secure the EC SPV Facility. The EC SPV Facility contains certain covenants for the Company such as minimum cash requirements and a minimum book value of equity requirement. There are also certain covenants for the product portfolio underlying the facility including, among other things, excess spread requirements, maximum roll rate and charge-off rate levels, and maximum loan-to-value ratios. The Company was in compliance with all covenants related to the EC SPV Facility as of December 31, 2020. VPC, ESPV SPV, EF SPV and EC SPV Facilities: The outstanding balance of Notes payable, net of debt issuance costs, for the years ended December 31, 2020 and 2019 are as follows: (Dollars in thousands) 2020 2019 US Term Note bearing interest at the base rate + 7.25% (2020) or + 7.5% (2019) $ 104,500 $ 182,000 4 th Tranche Term Note bearing interest at the base rate + 13% 18,050 18,050 ESPV Term Note bearing interest at the base rate + 7.25% (2020) or 7.5% (2019) 199,500 226,000 EF SPV Term Note bearing interest at the base rate + 7.25% (2020) or + 7.5% (2019) 93,500 102,000 EC SPV Term Note bearing interest at the base rate + 7.25% 25,000 — Debt issuance costs (2,147) (2,611) Total $ 438,403 $ 525,439 The change in the facility balances includes the following: • US Term Note - Paydowns of $27.5 million, $25 million and $25 million in the first, second, and fourth quarter of 2020, respectively; • ESPV Term Note - Paydowns of $6.5 million and $20 million in the first and second quarter of 2020, respectively. • EF SPV Term Note - Draw of $6.5 million in the first quarter of 2020 and a paydown of $15 million in the second quarter of 2020; and • EC SPV Term Note - Draw of $25 million in the fourth quarter of 2020; The Company paid a $2.4 million amendment fee on the ESPV Facility during the first quarter of 2019 that is included in deferred debt issuance costs and will be amortized into interest expense over the remaining life of the facility (through January 1, 2024). Additionally, the Company incurred an $850 thousand prepayment penalty during the second quarter of 2019 for the early repayment on the 4 th Tranche Term Note that is included in interest expense. Per the terms of the February amendments and the July 31, 2020 EC SPV agreement, the Company qualifies for a 25 bps rate reduction on the VPC, ESPV, EF SPV, and EC SPV facilities effective January 1, 2021. This reduction does not apply to the 4 th Tranche Term Note. The Company has evaluated the interest rates for its debt and believes they represent market rates based on the Company’s size, industry, operations and recent amendments. As a result, the carrying value for the debt approximates the fair value. The following table presents the future debt maturities as of December 31, 2020: Year (dollars in thousands) December 31, 2020 2021 $ 18,050 2022 — 2023 — 2024 422,500 2025 — Thereafter — Total $ 440,550 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | GOODWILL AND INTANGIBLE ASSETS The Company’s goodwill represents the excess purchase price over the estimated fair market value of the net assets acquired by the predecessor parent company, Think Finance, Inc. (“Think Finance”) related to the Elastic and previously consolidated UK reporting units. The Company performs an impairment review of goodwill and intangible assets with an indefinite life annually at October 1. As a result of the global economic impact and uncertainty due to the COVID-19 pandemic, the Company concluded a triggering event had occurred as of March 31, 2020, and accordingly, performed interim impairment testing on the goodwill balances of its reporting units. The Company performed a detailed qualitative and quantitative assessment of each reporting unit and concluded that the goodwill associated with the previously consolidated UK reporting unit was impaired as the fair value of the UK reporting unit was less than the carrying amount. The impairment loss of $9.3 million is included in Loss from discontinued operations due to the deconsolidation of ECIL. While there was a decline in the fair value of the Elastic reporting unit at March 31, 2020, there was no impairment identified during the quantitative assessment. The annual test was completed as of October 1, 2020 and the Company determined that there was no evidence of impairment of goodwill or indefinite lived intangible assets. For the period from March 31, 2020 to October 1, 2020, the fair value of the Elastic reporting unit remained steady and there was no impairment identified. No events or circumstances occurred between October 1 and December 31, 2020 that would more likely than not reduce the fair value of the Elastic reporting unit below the carrying amount. The Company has $6.8 million of goodwill (all related to the Elastic reporting unit) on the Consolidated Balance Sheets as of December 31, 2020 and December 31, 2019, respectively. Of the total goodwill balance, approximately $270 thousand is deductible for tax purposes. The Company's impairment evaluation of goodwill is based on comparing the fair value of the respective reporting unit to its carrying value. The fair value of the reporting unit is determined based on a weighted average of the income and market approaches. The income approach establishes fair value based on estimated future cash flows of the reporting unit, discounted by an estimated weighted-average cost of capital developed using the capital asset pricing model, which reflects the overall level of inherent risk of the reporting unit. The income approach uses the Company's projections of financial performance for a six The carrying value of acquired intangible assets as of December 31, 2020 is presented in the table below: (Dollars in thousands) Cost Accumulated Net Assets subject to amortization: Acquired technology $ 211 $ (211) $ — Non-compete 2,461 (1,859) 602 Customers 126 (126) — Assets not subject to amortization: Domain names 531 — 531 $ 3,329 $ (2,196) $ 1,133 The carrying value of acquired intangible assets as of December 31, 2019 is presented in the table below: (Dollars in thousands) Cost Accumulated Net Assets subject to amortization: Acquired technology $ 211 $ (211) $ — Non-compete 2,461 (1,739) 722 Customers 126 (126) — Assets not subject to amortization: Domain names 531 — 531 $ 3,329 $ (2,076) $ 1,253 In May 2018, a party to a non-compete agreement terminated employment with the Company. The terms of the non-compete agreement expired one year after termination. The Company determined that the useful life of the non-compete agreement should coincide with its expiration and therefore amortized the remaining carrying value on a straight-line basis through May 2019. As of December 31, 2020, the non-compete agreement was fully amortized. Total amortization expense recognized for the years ended December 31, 2020, 2019 and 2018 was approximately $120 thousand, $310 thousand, and $411 thousand respectively. The weighted-average remaining amortization period for the intangible assets was 5, 6 and 6 years at December 31, 2020, 2019 and 2018, respectively. Estimated amortization expense relating to intangible assets subject to amortization for the succeeding five years is as follows: Year (dollars in thousands) Amount 2021 120 2022 120 2023 120 2024 120 2025 120 |
Leases
Leases | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Leases | LEASES The Company has non-cancelable operating leases for facility space and equipment with varying terms. All of the active leases for facility space qualified for capitalization under FASB ASC 842, Leases . These leases have remaining lease terms of two The Company analyzes contracts above certain thresholds to identify leases and lease components. Lease and non-lease components are not separated for facility space leases. The Company uses its contractual borrowing rate to determine lease discount rates when an implicit rate is not available. Rental expense prior to the Company's adoption of ASC 842 was $2.8 million for the year ended December 31, 2018, respectively, and is reported in Occupancy and equipment in the Consolidated Income Statements. Total lease cost recognized after the adoption of ASC 842 for the years ended December 31, 2020 and 2019, as included in Occupancy and equipment in the Consolidated Income Statements, is detailed in the table below. Year ended December 31, Lease cost (dollars in thousands) 2020 2019 Operating lease cost $ 3,231 $ 3,138 Short-term lease cost — 22 Total lease cost $ 3,231 $ 3,160 Further information related to leases is as follows: Year ended December 31, Supplemental cash flows information (dollars in thousands) 2020 2019 Cash paid for amounts included in the measurement of lease liabilities $ 3,760 $ 3,135 Right-of-use assets obtained in exchange for lease obligations $ — $ 1,110 Weighted-average remaining lease term 3.6 years 4.5 years Weighted-average discount rate 10.23 % 10.23 % Future minimum lease payments as of December 31, 2020 are as follows: Year (dollars in thousands) Amount 2021 $ 3,876 2022 3,984 2023 3,486 2024 1,438 2025 1,254 Thereafter 638 Total future minimum lease payments $ 14,676 Less: Imputed interest (2,724) Operating lease liabilities $ 11,952 |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Share-Based Compensation | SHARE-BASED COMPENSATION Share-based compensation expense recognized for the years ended December 31, 2020, 2019 and 2018 totaled approximately $8.1 million, $9.9 million and $8.2 million, respectively. 2016 Omnibus Incentive Plan The 2016 Omnibus Incentive Plan (“2016 Plan”) was adopted by the Company’s Board of Directors on January 5, 2016 and approved by the Company’s stockholders thereafter. The 2016 Plan became effective on June 23, 2016. The 2016 Plan provides for the grant of incentive stock options to the Company’s employees, and for the grant of non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units, dividend equivalent rights, cash-based awards (including annual cash incentives and long-term cash incentives), and any combination thereof to the Company’s employees, directors and consultants. In connection with the 2016 Plan, the Company has reserved but not issued under the 2016 Plan 7,451,291 shares of common stock, which includes shares that would otherwise return to the 2014 Equity Incentive Plan (the "2014 Plan") as a result of forfeiture, termination, or expiration of awards previously granted under the 2014 Plan and outstanding when the 2016 Plan became effective. The 2016 Plan will automatically terminate 10 years following the date it became effective, unless the Company terminates it sooner. In addition, the Company’s Board of Directors has the authority to amend, suspend or terminate the 2016 Plan provided such action does not impair the rights under any outstanding award. As of December 31, 2020, the total number of shares available for future grants under the 2016 Plan was 3,085,505 shares. The Company has in the past and may in the future make grants of share-based compensation as inducement awards to new employees who are outside the 2016 Plan. The Company's board may rely on the employment inducement exception under NYSE Rule 303A.08 in order to approve the grants. 2014 Equity Incentive Plan The Company adopted the 2014 Plan on May 1, 2014. The 2014 Plan permitted the grant of incentive stock options, non-statutory stock options, and restricted stock. On April 27, 2017 the Company's Board of Directors terminated the 2014 Plan as to future awards and confirmed that underlying shares corresponding to awards under the 2014 Plan that were outstanding at the time the 2016 Plan became effective that are forfeited, terminated or expire will become available for issuance under the 2016 Plan. In conjunction with the 2016 and 2014 Plans, as of December 31, 2020, the Company had granted stock options and RSUs which are described in more detail below. Stock Options Stock options are awarded to encourage ownership of the Company's common stock by employees and to provide increased incentive for employees to render services and to exert maximum effort for the success of the Company. The Company's stock options generally permit net-share settlement upon exercise. The option exercise price, vesting schedule and exercise period are determined for each grant by the administrator of the applicable plan. The Company's stock options generally have a 10-year contractual term and vest over a 4-year period from the grant date. The weighted-average grant-date fair value for options granted in 2020 was $2.17. These options have a contractual term of 10 years and vest 100% on the third anniversary of the effective date. The assumptions used to determine the fair value of options granted in the years ended December 31, 2020 and 2019 using the Black-Scholes-Merton model are as follows: 2020 2019 Dividend yield 0 % 0 % Risk-free interest rate 0.53 % 1.43% to 2.47% Expected volatility (weighted-average and range, if applicable) 52 % 55% (52% to 55%) Expected term 7 years 7 years The expected term of the options granted is the period of time from the grant date to the date of expected exercise estimated using historical data. The expected volatility was determined based on the Company's stock price. The risk-free interest rate used is the current yield on US Treasury notes with a term equal to the expected term of the options at the grant date. The expected dividend yield is based on annualized dividends on the underlying share during the expected term of the option. A summary of stock option activity as of and for the year ended December 31, 2020 is presented below: Stock Options Shares Weighted-Average Weighted-Average Remaining Contractual Life (in years) Outstanding at December 31, 2019 2,269,178 $ 4.58 Granted 55,161 3.39 Exercised (1) (712,500) 2.13 Expired (25,000) 2.13 Canceled/Forfeited (700,154) 5.32 Outstanding at December 31, 2020 886,685 5.94 3.94 Options exercisable at December 31, 2020 886,685 $ 5.94 3.94 (1) During the year ended December 31, 2020, certain options were net share-settled to cover the required withholding tax and the remaining amounts were converted into an equivalent number of shares of the Company's common stock. The Company withheld 511,920 shares for applicable income and other employment taxes and remitted the cash to the appropriate taxing authorities. At December 31, 2020, the following options were outstanding at their respective exercise price: Exercise Price Options Outstanding $2.13 25,000 $4.29 - 4.57 200,000 $5.15 - 5.59 226,687 $6.31 243,821 $8.08 - 8.32 191,177 Total 886,685 At December 31, 2020, there was no unrecognized compensation cost related to non-vested stock options. The total intrinsic value of options exercised for the year December 31, 2020 was $1.1 million. Restricted Stock Units RSUs are awarded to serve as a key retention tool for the Company to retain its executives and key employees. RSUs will transfer value to the holder even if the Company’s stock price falls below the price on the date of grant, provided that the recipient provides the requisite service during the period required for the award to “vest.” The weighted-average grant-date fair value for RSUs granted under the 2016 Plan during the year ended December 31, 2020 was $1.65. These RSUs primarily vest 25% on the first anniversary of the effective date, and 25% each year thereafter, until full vesting on the fourth anniversary of the effective date. A summary of RSU activity as of and for the year ended December 31, 2020 is presented below: RSUs Shares Weighted-Average Unvested at December 31, 2019 4,161,862 $ 6.10 Granted 1,258,059 1.65 Vested (1) (1,559,107) 6.41 Canceled/Forfeited (936,728) 5.64 Unvested at December 31, 2020 2,924,086 4.17 Expected to vest at December 31, 2020 2,355,775 $ 4.28 (1) During the year ended December 31, 2020, certain RSUs were net share-settled to cover the required withholding tax and the remaining amounts were converted into an equivalent number of shares of the Company's common stock. The Company withheld 316,254 shares for applicable income and other employment taxes and remitted the cash to the appropriate taxing authorities. During the year ended December 31, 2020, the aggregate intrinsic value of vested and expected to vest RSUs was $9.4 million. The total intrinsic value of RSUs that vested during the year ended December 31, 2020 was $3.6 million. At December 31, 2020, there was approximately $6.7 million of unrecognized compensation cost related to non-vested RSUs which is expected to be recognized over a weighted-average period of 2.1 years. The total fair value of RSUs vested for the year ended December 31, 2020 was $10.0 million. Employee Stock Purchase Plan The Company offers an Employee Stock Purchase Plan ("ESPP") to eligible employees. There are currently 1,816,716 shares authorized for the ESPP and 704,407 shares reserved for the ESPP. There were 528,775 shares purchased under the ESPP for the year ended December 31, 2020. Within share-based compensation expense for the years ended December 31, 2020, 2019 and 2018, $637 thousand, $676 thousand, and $562 thousand, respectively, relates to the ESPP. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | FAIR VALUE MEASUREMENTS The accounting guidance on fair value measurements establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to measurements involving significant unobservable inputs (Level 3 measurements). The Company groups its assets and liabilities measured at fair value in three levels of the fair value hierarchy, based on the fair value measurement technique, as described below: Level 1—Valuation is based upon quoted prices (unadjusted) for identical assets and liabilities in active exchange markets that the Company has the ability to access at the measurement date. Level 2—Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques with significant assumptions and inputs that are observable in the market or can be derived principally from or corroborated by observable market data. Level 3—Valuation is derived from model-based techniques that use inputs and significant assumptions that are supported by little or no observable market data. These unobservable assumptions reflect estimates of assumptions that market participants would use in pricing the asset or liability. Valuation techniques include the use of pricing models, discounted cash flow models and similar techniques. The Company monitors the market conditions and evaluates the fair value hierarchy levels at least quarterly. For any transfers in and out of the levels of the fair value hierarchy, the Company discloses the fair value measurement at the beginning of the reporting period during which the transfer occurred. For the years ended December 31, 2020 and 2019, there were no significant transfers between levels. The level of fair value hierarchy within which a fair value measurement in its entirety falls is based on the lowest-level input that is most significant to the fair value measurement in its entirety. In the determination of the classification of assets and liabilities in Level 2 or Level 3 of the fair value hierarchy, the Company considers all available information, including observable market data, indications of market conditions, and its understanding of the valuation techniques and significant inputs used. Based upon the specific facts and circumstances, judgments are made regarding the significance of the Level 3 inputs to the fair value measurements of the respective assets and liabilities in their entirety. If the valuation techniques that are most significant to the fair value measurements are principally derived from assumptions and inputs that are corroborated by little or no observable market data, the asset or liability is classified as Level 3. Financial Assets and Liabilities Not Measured at Fair Value The Company has evaluated Loans receivable, net of allowance for loan losses, Receivable from CSO lenders, Receivable from payment processors and Accounts payable and accrued expenses, and believes the carrying value approximates the fair value due to the short-term nature of these balances. The Company has also evaluated the interest rates for Notes payable, net and believes they represent market rates based on the Company’s size, industry, operations and recent amendments. As a result, the carrying value for Notes payable, net approximates the fair value. The Company classifies its fair value measurement techniques for the fair value disclosures associated with Loans receivable, net of allowance for loan losses, Receivable from CSO lenders, Receivable from payment processors, Accounts payable and accrued liabilities and Notes payable, net as Level 3 in accordance with ASC 820-10, Fair Value Measurements and Disclosures (“ASC 820-10”). Fair Value Measurements on a Recurring Basis On January 11, 2018, the Company and ESPV each entered into one interest rate cap transaction with a counterparty to mitigate the floating rate interest risk on a portion of the debt under the VPC Facility and the ESPV Facility, respectively. On January 16, 2018, the Company and ESPV paid fixed premiums of $719 thousand and $648 thousand for the interest rate caps on the US Term Note (under the VPC Facility) and the ESPV Facility, respectively. The interest rate caps matured on February 1, 2019. The interest rate caps qualified for hedge accounting as cash flow hedges. Gains and losses on the interest rate caps were recognized in Accumulated other comprehensive income in the period incurred and subsequently reclassified to Interest expense when the hedged expenses were recorded. The Company used model-derived valuations that discounted the future expected cash receipts that would occur if variable interest rates rose above the strike price of the caps. The variable interest rates used in the calculation of projected receipts on the caps were based on an expectation of future interest rates derived from observable market interest rate curves and volatilities in active markets (Level 2). The following tables summarize these interest rate caps as of and for the years ended December 31, 2019 and 2018 (dollars in thousands) and no activity related to interest rate caps was incurred for the year ended December 31, 2020: Unrecognized gains recognized in Accumulated other comprehensive income Year ended December 31, 2019 Year Ended December 31, 2018 US Term Note interest rate cap $ — $ 159 ESPV Facility interest rate cap — 144 $ — $ 303 Gains recognized in Interest expense Year ended December 31, 2019 Year Ended December 31, 2018 US Term Note interest rate cap $ 159 $ 1,272 ESPV Facility interest rate cap 144 1,145 $ 303 $ 2,417 On June 29, 2020, ECIL entered administration and was therefore deconsolidated by the Company and its results presented as discontinued operations. The Company had guaranteed ECIL's repayment of its outstanding debt to VPC. See Note 7—Notes Payable for more information regarding the guarantee of the UK Term Note. The fair value of the guarantee obligation was $566 thousand and was recognized at June 30, 2020 within Net loss from discontinued operations in the Consolidated Income Statements and as Liabilities from discontinued operations on the Consolidated Balance Sheets. The fair value of the guarantee obligation was determined by using estimated cash flow scenarios that discounted ECIL's debt repayment schedules by the current interest rate on the UK Term Note which approximated a market value rate. The Company probability-weighted each scenario to calculate the weighted average fair value of the guarantee obligation. ECIL repaid its debt in full as of September 30, 2020 and the guarantee obligation was released. |
Derivatives
Derivatives | 12 Months Ended |
Dec. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives | DERIVATIVES The Company and ESPV have periodically used hedging programs to manage interest rate risk associated with future interest payments. The Company and ESPV entered into two interest rate cap instruments on January 11, 2018, which matured on February 1, 2019. The Company had no outstanding derivative instruments as of December 31, 2020 and 2019. Cash Flow Hedges The Company and ESPV utilized interest rate caps to offset interest rate fluctuations in the Company's and ESPV's future interest payments on certain of their Notes payable. The financial instruments were designated and accounted for as cash flow hedges, and the Company and ESPV measured the effectiveness of the hedges at least quarterly. Effective gains or losses related to these cash flow hedges were reported in Accumulated other comprehensive income (loss) and reclassified into earnings, through interest expense, in the period or periods in which the hedged transactions affected earnings. See Note 11—Fair Value for additional information on these cash flow hedges. The following table summarizes the activity that was recorded in Accumulated other comprehensive income (loss) in addition to reclassifications from Accumulated other comprehensive income (loss) into earnings related to each of the Company's and ESPV's interest rate caps during the years ended December 31, 2019 and 2018. Year ended December 31, 2019 Year Ended December 31, 2018 (Dollars in thousands) US Term Note ESPV Facility US Term Note ESPV Facility Beginning unrealized gains in Accumulated other comprehensive income $ 159 $ 144 $ — $ — Gross gains recognized in Accumulated other comprehensive income — — 1,431 1,289 Gains reclassified to income through Interest expense (159) (144) (1,272) (1,145) Ending unrealized gains in Accumulated other comprehensive income $ — $ — $ 159 $ 144 There were no interest rate caps during the year ended December 31, 2020. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES Income tax expense for the years ended December 31, 2020, 2019 and 2018 consists of the following: (Dollars in thousands) 2020 2019 2018 Current income tax expense (benefit): Federal $ — $ — $ (5) State (350) 576 150 Total current income tax expense (350) 576 145 Deferred income tax expense (benefit): Federal 10,985 9,643 326 State 275 1,940 (97) Total deferred income tax expense 11,260 11,583 229 Total income tax expense $ 10,910 $ 12,159 $ 374 No material penalties or interest related to taxes were recognized for the years ended December 31, 2020, 2019 and 2018. The Company's consolidated effective tax rates for continuing operations were 23%, 32% and 3% for the years ended December 31, 2020, 2019 and 2018, respectively. The Company's US cash effective tax rate for 2020 was approximately 2.8%. The differences between the provision for income tax and the amount that would result if the federal statutory rate were applied to the pre-tax financial income for the years ended December 31, 2020, 2019 and 2018 were as follows: (Dollars in thousands) 2020 2019 2018 Federal statutory rate of 21% $ 9,894 $ 8,054 $ 2,966 State income tax provision (377) 1,611 579 Permanent differences 2,242 2,462 225 Change in federal statutory rate - US tax reform — — (970) Research and development credit (1,757) (860) (2,493) Other 908 892 67 Total $ 10,910 $ 12,159 $ 374 On December 22, 2017, the SEC issued SAB 118, which provides guidance on accounting for tax effects of the Act. SAB 118 provides a measurement period of up to one year from the enactment date to complete the accounting. The Company completed its accounting of the impact of the reduction in the corporate tax rate and remeasurement of certain deferred tax assets and liabilities based on the rate at which they are expected to reverse in the future, generally 21%, in 2018. During the year ended December 31, 2018, the Company recorded a benefit of $970 thousand to its provisional amounts related to the Act, which had a (7)% impact for the year ended December 31, 2018. The tax effects of temporary differences that give rise to significant portions of deferred tax assets and deferred tax liabilities at December 31, 2020 and 2019 are presented below: (Dollars in thousands) 2020 2019 Deferred Tax Assets: Allowance for losses on loans receivable $ 4,600 $ 8,450 Net operating loss carryforward 15,954 196 Research and development credit 5,765 3,139 Deferred equity compensation costs 1,244 2,130 Accrued expenses 8,279 3,426 Deferred equity issuance costs 26 23 Other 1,165 671 Total deferred tax assets 37,033 18,035 Deferred Tax Liabilities: Property and equipment, principally due to differences in depreciation (2,037) (609) Amortization of intangible assets (7,486) (7,416) Prepaid expenses (1,552) (1,226) Net deferred tax assets before valuation allowance 25,958 8,784 Valuation allowance — — Deferred tax assets, net $ 25,958 $ 8,784 For purposes of evaluating the need for a deferred tax valuation allowance, significant weight is given to evidence that can be objectively verified. The following provides an overview of the assessment that was performed. At December 31, 2020 and 2019, the Company did not establish a valuation allowance for its deferred tax assets ("DTA”) based on management’s expectation of generating sufficient taxable income in a look forward period over the next one Significant factors include the following: • The Company is in a three-year cumulative pre-tax income position in 2020. Additionally, the Company has a history of utilizing its past NOL carryforwards. • Due to the short-term nature of the loan portfolio and the other material items that comprise the deferred tax assets, net, the Company estimates that the majority of these deferred tax items will reverse within one year and the remainder to reverse within three The Company has given due consideration to all the factors and has concluded that the deferred tax asset is expected to be realized based on management’s expectation of generating sufficient taxable income and the reversal of tax timing differences in a look-forward period over the next one The Company has no recorded liabilities for uncertain tax positions at December 31, 2020 and 2019. |
Commitments, Contingencies and
Commitments, Contingencies and Guarantees | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments, Contingencies and Guarantees | COMMITMENTS, CONTINGENCIES AND GUARANTEES Contingencies Currently and from time to time, the Company may become a defendant in various legal and regulatory actions that arise in the ordinary course of business. The Company generally cannot predict the eventual outcome, the timing of the resolution or the potential losses, fines or penalties of such legal and regulatory actions. Actual outcomes or losses may differ materially from the Company's current assessments and estimates, which could have a material adverse effect on the Company's business, prospects, results of operations, financial condition or cash flows. In accordance with applicable accounting guidance, the Company establishes an accrued liability for litigation, regulatory matters and other legal proceedings when those matters present material loss contingencies that are both probable and reasonably estimable. Even when an accrual is recorded, the Company may be exposed to loss in excess of any amounts accrued. Other Matters: In December 2019, the Think Finance, Inc. ("TFI") bankruptcy plan was confirmed, and any potential future claims from the TFI Creditors' Committee were assigned to the Think Finance Litigation Trust (“TFLT”). On August 14, 2020, the TFLT filed an adversary proceeding against Elevate Credit, Inc. in the United States Bankruptcy Court for the Northern District of Texas, alleging certain avoidance claims related to Elevate's spin-off from TFI under the Bankruptcy Code and the Texas Uniform Fraudulent Transfer Act ("TUFTA"). If it were determined that the spin-off constituted a fraudulent conveyance or that there were other avoidance actions associated with the spin-off, then the spin-off could be deemed void and there could be a number of different remedies imposed against Elevate, including without limitation, the requirement that Elevate has to pay money damages. While the TFLT values this claim at $246 million, the Company believes that it has valid defenses to the claim and intends to vigorously defend itself against this claim. Additionally, a class action lawsuit against Elevate was filed on August 14, 2020 in the Eastern District of Virginia alleging violations of usurious interest and aiding and abetting various racketeering activities related to the operations of TFI prior to and immediately after the 2014 spin-off. Elevate views this lawsuit as without merit and intends to vigorously defend its position. Based upon preliminary settlement discussions in the fourth quarter of 2020, the Company accrued a contingent loss in the amount of $17 million for estimated losses related to the TFLT and class action disputes at December 31, 2020. This accrual is recognized as Non-operating loss in the Consolidated Income Statements and as Accounts payable and accrued liabilities on the Consolidated Balance Sheets. On June 5, 2020, the District of Columbia (the "District") sued Elevate in the Superior Court of the District of Columbia alleging that Elevate may have violated the District's Consumer Protection Procedures Act and the District of Columbia's Municipal Regulations in connection with loans issued by banks in the District of Columbia. This action has been removed to federal court, but the District has filed a motion to remand to the Superior Court on August 3, 2020. Elevate disagrees that it has violated the above referenced laws and regulations and it intends to vigorously defend its position. In addition, on January 27, 2020, an Elevate wholly-owned subsidiary and other non-affiliated service providers to banks were sued in a class action lawsuit in Washington state. The Plaintiff in the case claims that Elevate and the other non-affiliated service providers to banks have violated Washington’s Consumer Protection Act by engaging in unfair or deceptive practices. The lawsuit was removed to federal court. On January 12, 2021, the court granted Rise's motion to dismiss, however Plaintiffs amended the complaint on January 25, 2021, suing Elevate alleging it is the true lender and violated Washington's Consumer Protection Act. Elevate disagrees that it has violated the above referenced law and it intends to vigorously defend its position. In California, two separate actions have been filed seeking damages and public injunctive relief and alleging unconscionable interest rates on Rise loans - one lawsuit in the Superior Court of California, and one demand for arbitration. The Plaintiffs in these actions assert claims under the “unlawful,” “unfair,” and “fraudulent” prongs of the California Unfair Competition Law (“UCL”) and for breach of contract and civil conspiracy. The “unlawful” UCL claims are premised upon alleged violations of (a) the California Financing Law’s prohibition on unconscionable loans and (b) the California False Advertising Law. The arbitration claimant further alleges violations of the Electronic Fund Transfer Act and the Rosenthal Fair Debt Collection Practices Act. Plaintiff dismissed the state court actions. Elevate disagrees that it has violated the above referenced laws and it intends to vigorously defend its position. Commitments The Elastic product, which offers lines of credit to consumers, had approximately $275.9 million and $251.2 million in available and unfunded credit lines at December 31, 2020 and 2019, respectively. From May 2017 through September 2020, the Rise product offered lines of credit to consumers in certain states and had approximately $0.0 million and $8.3 million at December 31, 2020 and 2019, respectively, in available and unfunded credit lines. The Today Card product had approximately $5.4 million and $0.6 million in available and unfunded credit lines at December 31, 2020 and 2019, respectively. While these amounts represented the total available unused credit lines, the Company has not experienced and does not anticipate that all line of credit customers and credit card customers will access their entire available credit lines at any given point in time. The Company has not recorded a loan loss reserve for unfunded credit lines as the Company has the ability to cancel commitments within a relatively short timeframe. Effective June 2017, the Company entered into a seven-year lease agreement for office space in San Diego, California. Upon the commencement of the lease, the Company was required to provide the lessor with an irrevocable and unconditional $500 thousand letter of credit. Provided the Company is not in default of any terms of the lease agreement, the outstanding required balance of the letter of credit will be reduced by $100 thousand per year beginning on the second anniversary of the lease commencement and ending on the fifth anniversary of the lease agreement. The minimum balance of the letter of credit will be at least $100 thousand throughout the duration of the lease. At December 31, 2020 and 2019, the Company had $300 thousand and $400 thousand, respectively, of cash balances securing the letter of credit which is included in Restricted cash within the Consolidated Balance Sheets. Guarantees CSO Program: In connection with its CSO programs, the Company guarantees consumer loan payment obligations to CSO lenders and is required to purchase any defaulted loans it has guaranteed. The guarantee represents an obligation to purchase specific loans that go into default. UK Debt Guarantee: As a result of ECIL’s entry into administration and deconsolidation, the Company had recognized a guarantee obligation related to the repayment of the UK Term Note by ECIL. The fair value of the guarantee obligation was $566 thousand and was recognized at June 30, 2020 within Net loss from discontinued operations in the Consolidated Income Statements and as Liabilities from discontinued operations on the Consolidated Balance Sheets. See Note 5—Notes Payable for more information regarding the guarantee of the UK Term Note. ECIL has fully repaid the UK Term Note and the guarantee obligation has been released as of December 31, 2020. Indemnifications and contingent loss accrual In the ordinary course of business, the Company may indemnify customers, vendors, lessors, investors, and other parties for certain matters subject to various terms and scopes. For example, the Company may indemnify certain parties for losses due to the Company's breach of certain agreements or due to certain services it provides. As the Company has previously disclosed, the Company has also entered into separate indemnification agreements with the Company’s directors and executive officers, in addition to the indemnification provided for in the Company’s amended and restated bylaws. These agreements, among other things, provide that the Company will indemnify its directors and executive officers for certain expenses, including attorneys’ fees, judgments, penalties, fines and settlement amounts incurred by a director or executive officer in any action or proceeding arising out of their services as one of the Company’s or, where applicable, TFI’s directors or executive officers, or any of the Company’s subsidiaries or any other company or enterprise to which the person provides services at the Company’s request. The indemnification agreements also set forth certain procedures that will apply in the event of a claim for indemnification thereunder. During the year ended December 31, 2020, the Company accrued a contingent loss related to a legal matter in the amount of $7.1 million with $4.4 million remaining accrued at year-end. The accrual is recognized as Non-operating loss in the Consolidated Income Statements and as Accounts payable and accrued liabilities on the Consolidated Balance Sheets. This contingent loss is based on a probable settlement composed of both cash and certain amounts that are subject to valuation adjustments until the final settlement. The table below presents a rollforward of the amounts accrued for the year ended December 31, 2020. (Dollars in thousands) Year ended December 31, 2020 Beginning balance at December 31, 2019 $ — Expected loss accrual 7,065 Payments made $ (2,641) Net contingent loss accrual related to a legal matter at December 31, 2020 $ 4,424 |
Discontinued Operations
Discontinued Operations | 12 Months Ended |
Dec. 31, 2020 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | DISCONTINUED OPERATIONSOn June 29, 2020, ECIL entered into administration in accordance with the provisions of the UK Insolvency Act 1986 and pursuant to a resolution of the board of directors of ECIL. The management, business, affairs and property of ECIL have been placed into the direct control of the appointed administrators, KPMG LLP. Accordingly, the Company deconsolidated ECIL as of June 29, 2020 and presents ECIL's results as Discontinued operations for all periods presented. The table below presents the financial results of ECIL, which are considered Discontinued operations and are excluded from the Company's results of continuing operations: Years Ended December 31 (Dollars in thousands) 2020 (1) 2019 2018 Revenues $ 24,012 $ 108,089 $ 122,966 Cost of sales: Provision for loan losses 4,785 38,579 49,780 Direct marketing costs 1,372 12,735 22,882 Other cost of sales 10,790 18,763 14,220 Total cost of sales 16,947 70,077 86,882 Gross profit 7,065 38,012 36,084 Operating expenses: Compensation and benefits 4,785 13,653 13,524 Professional services 2,879 4,881 6,040 Selling and marketing 605 2,608 3,241 Occupancy and equipment 2,141 4,723 3,733 Depreciation and amortization 1,427 1,501 1,512 Other 288 792 932 Total operating expenses 12,125 28,158 28,982 Operating (loss) income (5,060) 9,854 7,102 Other expense: Net interest expense (896) (4,113) (5,900) Foreign currency transaction loss (854) 334 (1,409) Impairment loss (9,251) — — Total other expense (11,001) (3,779) (7,309) Gain (loss) from operations of discontinued operations (16,061) 6,075 (207) Loss on disposal of discontinued operations (27,983) — — Gain (loss) from discontinued operations before taxes (44,044) 6,075 (207) Income tax benefit (expense) 28,434 (88) (1,034) Net income (loss) from discontinued operations $ (15,610) $ 5,987 $ (1,241) (1) Includes ECIL financial results for the period through June 28, 2020. The table below presents the aggregate carrying amounts of the assets and liabilities of ECIL and those carried by the Company as discontinued operations related to ECIL: (Dollars in thousands except share amounts) December 31, December 31, ASSETS Cash and cash equivalents $ — $ 17,698 Restricted cash — 59 Loans receivable, net of allowance for loan losses of $0 and $7,083, respectively — 31,604 Prepaid expenses and other assets — 4,871 Receivable from payment processors — 1,970 Deferred tax assets, net — 1,355 Property and equipment, net — 14,045 Goodwill, net — 9,251 Intangible assets, net — 149 Total assets classified as discontinued operations in the Consolidated Balance Sheets $ — $ 81,002 LIABILITIES AND STOCKHOLDERS’ EQUITY Accounts payable and accrued liabilities $ — $ 6,917 Notes payable, net — 29,624 Total liabilities classified as discontinued operations in the Consolidated Balance Sheets $ — $ 36,541 The Company had continuing involvement with ECIL as the guarantor of ECIL's debt of approximately £10.2 million as of June 29, 2020 and a guarantee obligation of $566 thousand was recognized at fair value within Liabilities from discontinued operations on the Consolidated Balance Sheets and within Net loss from discontinued operations on the Consolidated Income Statements. This guarantee expired upon ECIL's repayment of the UK Term Note and the guarantee obligation of $566 thousand was released as of September 30, 2020. See Note 7—Notes Payable for more information regarding the guarantee of the UK Term Note. The Company also had obligations related to severance pay due to certain employees of ECIL which have been settled and paid in July 2020. In connection with the disposition of ECIL, the Company recognized a loss on its investment. This loss resulted in an estimated US federal and state income tax benefit of $24.2 million and was recognized in the three- and six-month period ended June 30, 2020. The Company revised the estimated tax basis in ECIL resulting in an additional $4.2 million income tax benefit for a total tax benefit of $28.4 million at December 31, 2020, which will be available to offset future US income tax obligations. |
Related Parties
Related Parties | 12 Months Ended |
Dec. 31, 2020 | |
Related Party Transactions [Abstract] | |
Related Parties | RELATED PARTIES The Company entered into sublease agreements with Think Finance for office space that expired in 2018. Total rent and utility payments made to Think Finance for office space were approximately $0.8 million for the year ended December 31, 2018, and $0.0 million for both the years ended December 31, 2020 and 2019, respectively. Rent and utility expense is included in Occupancy and equipment within the Consolidated Income Statements. Expenses related to the Company's board of directors, including board fees, travel reimbursements, share-based compensation and a consulting arrangement with a related party are included in Professional services within the Consolidated Income Statements. These expenses for the years ended December 31, 2020, 2019 and 2018 were as follows: Years Ended December 31, (Dollars in thousands) 2020 2019 2018 Fees and travel expenses $ 475 $ 532 $ 543 Stock compensation 1,693 2,361 1,311 Consulting 150 300 300 Total board related expenses $ 2,318 $ 3,193 $ 2,154 At December 31, 2020 and 2019, the Company owed approximately $110 thousand and $123 thousand, respectively, to board members related to the above expenses, which is included in Accounts payable and accrued liabilities within the Consolidated Balance Sheets. During the year ended December 31, 2020, the Company made payments to a former executive and member of the board for reimbursement of legal expenses and per the terms of an indemnification agreement. These payments totaled approximately $2.6 million. A separate member of the board entered into a direct investment in the Rise portion of the VPC Facility for $800 thousand during the year ended December 31, 2017. The interest payments on this investment were $81 thousand, $85 thousand and $107 thousand for the years ended December 31, 2020, 2019 and 2018, respectively. |
401(k) Plan
401(k) Plan | 12 Months Ended |
Dec. 31, 2020 | |
Retirement Benefits [Abstract] | |
401(k) Plan | 401(k) PLAN The Company adopted a 401(k) Plan (the “Plan”) on June 1, 2014. All employees are eligible to participate in the Plan upon reaching the age of 21 years and completing one month of service with the Company. The Plan is a “safe harbor 401k plan” and the Company matches 100% of each participant’s first 5% of compensation that is contributed to the Plan each year. Participants may contribute up to 70% of their eligible earnings to the applicable Plan, subject to regulatory and other plan restrictions. Company and employee contributions are fully vested at the time of contribution. The Company’s consolidated matching contributions in the years ended December 31, 2020, 2019 and 2018 totaled approximately $3.0 million, $2.8 million and $2.5 million, respectively. |
Quarterly Financial Data (Unaud
Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Data (Unaudited) | QUARTERLY FINANCIAL DATA (UNAUDITED)The Company’s operations are subject to seasonal fluctuations. Loan demand has historically been highest in the third and fourth quarters of each year, corresponding to the holiday season, and lowest in the first quarter of each year, corresponding to the Company's customers’ receipt of income tax refunds. During 2020, the Company experienced a decrease in loan demand during the second through fourth quarters due to the COVID-19 pandemic that began in March 2020. Typically, the Company’s loan loss provision, a significant portion of cost of sales, in addition to direct marketing and other cost of sales, is lowest as a percentage of revenue in the first half of each year. The following is a summary of the quarterly results of operations for the years ended December 31, 2020 and 2019 (in thousands, except share and per share data): (Dollars in thousands, except share and per share amounts) First Quarter Second Quarter Third Quarter Fourth Quarter 2020 Total revenue $ 162,467 $ 117,991 $ 94,164 $ 90,724 Total cost of sales 92,214 43,428 17,421 32,253 Gross profit $ 70,253 $ 74,563 $ 76,743 $ 58,471 Net income (loss) from continuing operations $ 7,922 $ 16,093 $ 16,616 $ (4,429) Net income (loss) from discontinued operations (12,833) (7,540) 4,465 298 Net income (loss) $ (4,911) $ 8,553 $ 21,081 $ (4,131) Basic earnings per share - continuing operations $ 0.18 $ 0.38 $ 0.41 $ (0.11) Basic earnings per share - discontinued operations (0.29) (0.18) 0.11 0.01 Basic earnings (loss) per share $ (0.11) $ 0.20 $ 0.52 $ (0.10) Diluted earnings per share - continuing operations $ 0.18 $ 0.38 $ 0.41 $ (0.11) Diluted earnings per share - discontinued operations (0.29) (0.18) 0.11 0.01 Diluted earnings (loss) per share $ (0.11) $ 0.20 $ 0.52 $ (0.10) Basic weighted-average shares outstanding 43,161,716 42,182,412 40,230,256 38,851,781 Diluted weighted-average shares outstanding 43,161,716 42,511,808 40,762,330 38,851,781 2019 Total revenue $ 160,066 $ 150,374 $ 164,296 $ 164,137 Total cost of sales 84,830 81,864 105,076 102,523 Gross profit $ 75,236 $ 68,510 $ 59,220 $ 61,614 Net income from continuing operations $ 10,955 $ 8,383 $ 2,648 $ 4,210 Net income (loss) from discontinued operations 2,403 (2,611) 2,116 4,079 Net income $ 13,358 $ 5,772 $ 4,764 $ 8,289 Basic earnings per share - continuing operations $ 0.25 $ 0.19 $ 0.06 $ 0.10 Basic earnings per share - discontinued operations 0.06 (0.06) 0.05 0.09 Basic earnings per share $ 0.31 $ 0.13 $ 0.11 $ 0.19 Diluted earnings per share - continuing operations $ 0.25 $ 0.19 $ 0.06 $ 0.09 Diluted earnings per share - discontinued operations 0.05 (0.06) 0.05 0.10 Diluted earnings per share $ 0.30 $ 0.13 $ 0.11 $ 0.19 Basic weighted-average shares outstanding 43,348,249 43,681,159 44,169,964 44,009,459 Diluted weighted-average shares outstanding 43,875,410 44,291,816 44,743,944 44,587,331 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | SUBSEQUENT EVENTS The Company evaluated subsequent events and determined there have been no material subsequent events that required recognition or additional disclosure in these financial statements, except as follows: In January 2021, the Company paid off the remaining $18.1 million balance of the 4th Tranche Term Note, which was scheduled to mature on February 1, 2021, and paid down an additional $79.5 million in outstanding debt under the revolving feature of its debt facilities. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Accounting | The Company’s accounting and reporting policies are in accordance with accounting principles generally accepted in the United States (“US GAAP”) and conform, as applicable, to general practices within the finance company industry. The following is a description of the more significant of these policies used in preparing the consolidated financial statements. |
Basis of Presentation | Basis of PresentationThe consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries and variable interest entities ("VIEs") where the Company is the primary beneficiary. All significant intercompany transactions and accounts have been eliminated. |
Reclassifications | ReclassificationsCertain amounts in the prior periods presented herein have been reclassified to conform to the current period financial statement presentation. The Company does not believe that these reclassifications have a material impact on the consolidated financial statements. |
Use of Estimates | Use of Estimates The preparation of the consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant items subject to such estimates and assumptions include the valuation of the allowance for loan losses, goodwill, long-lived and intangible assets, deferred revenues, contingencies, the fair value of derivatives, the income tax provision, valuation of share-based compensation, operating lease right of use assets, operating lease liabilities and the valuation allowance against deferred tax assets. The Company bases its estimates on historical experience, current data and assumptions that are believed to be reasonable. Actual results in future periods could differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly-liquid investments purchased with an original maturity of three months or less to be cash equivalents. |
Restricted Cash | Restricted Cash Amounts restricted under lending agreements, third-party processing agreements and state licensing requirements are classified separately as restricted cash. |
Installment Loans, Lines of Credit and Credit Cards | Installment Loans, Lines of Credit and Credit Cards Installment loans, lines of credit and credit cards, including receivables for finance charges, fees and interest, are unsecured and reported as Loans receivable, net of allowance for loan losses on the Consolidated Balance Sheets. Installment loans are multi-payment loans that require the pay-down of portions of the outstanding principal balance in multiple installments through the Rise brand. Line of credit accounts include customer cash advances made through the Elastic brand and the Rise brand in two states (which were discontinued in September 2020). Credit cards represent credit card receivable balances, uncollected billed interest and fees through the Today Card brand. The Company offers Rise installment products directly to customers. Elastic lines of credit, Rise bank-originated installment loans and Today credit card receivables represent participation interests acquired from third-party lenders through a wholly owned subsidiary or by a VIE. Based on agreements with the third-party lenders, the VIEs pay a loan premium on the participation interests purchased. The loan premium is amortized over the expected life of the outstanding loan amount. At December 31, 2020, 2019 and 2018, the amortization expenses on the loan premiums were $4.6 million, $6.0 million and $6.2 million, respectively, and are included within Revenues in the Consolidated Income Statements. See Note 4—Variable Interest Entities for more information regarding these participation interests in Rise and Elastic receivables. The Company considers impaired loans as accounts over 60 days past due (for installment loans and lines of credit) or 120 days (for credit cards) or loans which become uncollectible based on information that the Company becomes aware of (e.g., receipt of customer bankruptcy notice). The impaired loans are charged-off at the time that they are deemed to be uncollectible. A modification of finance receivable terms is considered a troubled debt restructuring ("TDR") if the borrower is experiencing financial difficulty and the Company grants a concession it would not otherwise have considered to a borrower. The Company considers TDRs to include all installment and line of credit loans that were modified by granting principal and interest forgiveness or by extension of the maturity date greater than 60 days as a part of a loss mitigation strategy. On March 22, 2020, federal and state banking regulators issued a joint statement on working with customers affected by COVID-19 (the "Interagency Statement"). The Interagency Statement includes guidance on accounting for loan modifications. In accordance with the Interagency Statement, the Company, and the bank originators the Company supports, have elected to not recognize modified loans as TDRs if the borrower was both: 1) not more than 30 days past due as of March 1, 2020 (or at the requested modification date if originated on or after March 2, 2020); and 2) the modification stems from the effects of the COVID-19 outbreak. The modifications offered by the Company to borrowers that meet both qualifications may include short-term payment deferrals less than six months, interest or fee waivers, extensions of payment terms or delays in payment that are insignificant. If the borrower was not current at March 1, 2020, the Company offers similar modifications that are considered TDRs. This election is applicable from March 1, 2020 until the earlier of 60 days following the date the COVID-19 national emergency comes to an end or January 1, 2022. |
Allowance for Loan Losses | Allowance for Loan Losses The Company has adopted Financial Accounting Standards Board (“FASB”) guidance for disclosures about the credit quality of financing receivables and the allowance for loan losses (“allowance”). The Company maintains an allowance for loan losses for loans and interest receivable for loans not classified as TDRs at a level estimated to be adequate to absorb credit losses inherent in the outstanding loans receivable. The Company primarily utilizes historical loss rates by product, stratified by delinquency ranges, to determine the allowance, but also considers recent collection and delinquency trends, as well as macro-economic conditions that may affect portfolio losses. Additionally, due to the uncertainty of economic conditions and cash flow resources of the Company’s customers, the estimate of the allowance for loan losses is subject to change in the near-term and could significantly impact the consolidated financial statements. If a loan is deemed to be uncollectible before it is fully reserved, it is charged-off at that time. For loans classified as TDRs, impairment is typically measured based on the present value of the expected future cash flows discounted at the original effective interest rate. |
Revenue Recognition | Revenue Recognition The Company recognizes consumer loan fees as revenues for each of the loan products it offers. Revenues on the Consolidated Income Statements include: finance charges, lines of credit fees, fees for services provided through CSO programs (“CSO fees”), and interest, as well as any other fees or charges permitted by applicable laws and pursuant to the agreement with the borrower. Other revenues also include marketing and licensing fees received from the originating lender related to the Elastic product and Rise bank-originated loans and from CSO fees related to the Rise product. Revenues related to these fees are recognized when the service is performed. The Company accrues finance charges on installment loans on a constant yield basis over their terms. The Company accrues and defers fixed fees such as CSO fees and lines of credit fees when they are assessed and recognizes them to earnings as they are earned over the life of the loan. The Company accrues interest on credit cards based on the amount of the credit card balance outstanding and the related contractual interest rate. Credit card membership fees are amortized to revenue over the card membership period. Other credit card fees, such as late payment fees and returned payment fees, are accrued when assessed. The Company does not accrue finance charges and other fees on installment loans or lines of credit for which payment is greater than 60 days past due. Credit card interest charges are recognized based on the contractual provisions of the underlying arrangements and are not accrued when payment is past due more than 90 days. Installment loans and lines of credit are considered past due if a grace period has not been requested and a scheduled payment is not paid on its due date. Credit cards have a grace period of 25 days and are considered delinquent after the grace period. Payments received on past due loans are applied against the loan and accrued interest balance to bring the loan current. Payments are generally first applied to accrued fees and interest and then to the principal loan balance. The spread of COVID-19 since March 2020 has created a global public health crisis that has resulted in unprecedented disruption to businesses and economies. In response to the pandemic's effects, and in accordance with federal and state guidelines, the Company expanded its payment flexibility programs for its customers, including payment deferrals. This program allows for a deferral of payments for an initial period of 30 to 60 days, and generally up to a maximum of 180 days on a cumulative basis. A customer will return to the normal payment schedule after the end of the deferral period with the extension of the maturity date equivalent to the deferral period, which is generally not to exceed an additional 180 days. The finance charges will continue to accrue at a lower effective interest rate over the expected term of the loan as adjusted for the deferral period provided (not to exceed an amount greater than the amount at which the borrower could settle the loan) or placed on non-accrual status. |
Credit Service Organization | Credit Service Organization The Company also provides services in connection with installment loans originated by independent third-party lenders (“CSO lenders”), whereby the Company acts as a credit services organization/credit access business on behalf of consumers in accordance with applicable state laws (the “CSO program”). Previously, the CSO program included arranging loans with CSO lenders, assisting in the loan application, documentation and servicing processes. As of December 31, 2020, the CSO lenders are no longer originating Rise CSO loans. The Company continues to service existing loans. Under the CSO program, the Company guarantees the repayment of the customer’s loan to the CSO lenders as part of the credit services it provides to the customer. A customer who obtained a loan through the CSO program paid the Company a fee for the credit services, including the guaranty, and entered into a contract with the CSO lenders governing the credit services arrangement. The CSO fee received was initially recognized as deferred revenue and subsequently recognized over the life of the loan. The Company estimates a liability for losses associated with the guaranty provided to the CSO lenders using assumptions and methodologies similar to the allowance for loan losses detailed previously. The CSO program required that the Company fund a cash reserve equal to 25% - 45% of the outstanding loan principal within the CSO program portfolio. As of December 31, 2020 and 2019, respectively, estimated losses of approximately $0.7 million and $2.1 million for the CSO loans receivable guaranteed by the Company of approximately $2.2 million and $19.6 million, respectively, are initially recorded at fair value and are included in Accounts payable and accrued liabilities in the Consolidated Balance Sheets. See Note 3—Loans Receivable and Revenues for additional information on loans receivable and the provision for loan losses. |
Receivables from Payment Processors | Receivables from Payment Processors The Company has entered into agreements with third-party service providers to conduct processing activities, including the funding of new customer loans and the collection of customer payments for those loans. In accordance with contractual agreements, these funds are settled back to the Company within one to three business days after the date of the originating transaction. Accordingly, the Company had approximately $6.1 million and $8.7 million due from processing providers as of December 31, 2020 and 2019, respectively, which is included in Receivable from payment processors in the Consolidated Balance Sheets. |
Direct Marketing and Selling and Marketing Costs | Direct Marketing Costs Marketing expenses consist of online marketing costs such as sponsored search and advertising on social networking sites, and other marketing costs such as purchased television and radio advertising and direct mail print advertising. In addition, marketing expense includes affiliate costs paid to marketers in exchange for information for applications from potential customers. Online marketing, affiliate costs and other marketing costs are expensed as incurred. Selling and Marketing Costs Selling and marketing costs include costs associated with the use of agencies that perform creative services and monitor and measure the performance of the various marketing channels. Selling and marketing costs also include the production costs associated with media advertisements that are expensed as incurred over the licensing or production period. |
Operating Segments | Operating Segments The Company determines operating segments based on how its chief operating decision-maker manages the business, including making operating decisions, deciding how to allocate resources and evaluating operating performance. The Company's chief operating decision-maker is its Chief Executive Officer, who reviews the Company's operating results monthly on a consolidated basis. |
Property and Equipment, net | Property and Equipment, net Property and equipment are stated at cost, net of accumulated depreciation and amortization. The Company capitalizes all acquisitions of property and equipment of $500 or greater. The Company capitalizes certain software development costs. Costs incurred in the preliminary stages of development are expensed, but software development costs incurred thereafter, including external direct costs of materials and services as well as payroll and payroll-related costs, are capitalized. Maintenance and repairs that do not extend the useful life of the assets are expensed as incurred. Depreciation and amortization are computed using the straight-line method over the estimated useful lives of the depreciable or amortizable assets as follows: Furniture and fixtures 7 years Equipment 3-5 years Leasehold improvements The lesser of the related lease term or useful life of 3-5 years Software and software development 3 years |
Income Taxes | Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences and benefits attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts that are more likely than not to be realized. Relative to uncertain tax positions, the Company accrues for losses it believes are probable and can be reasonably estimated. The amount recognized is subject to estimate and management judgment with respect to the likely outcome of each uncertain tax position. The amount that is ultimately sustained for an individual uncertain tax position or for all uncertain tax positions in the aggregate could differ from the amount recognized. If the amounts recorded are not realized or if penalties and interest are incurred, the Company has elected to record all amounts within income tax expense. The Company has no recorded liabilities for uncertain tax positions at December 31, 2020 and 2019. Tax periods from fiscal years 2014-2019 remain open and subject to examination for US federal and state tax purposes. As the Company had no operations nor had filed US federal tax returns prior to May 1, 2014, there are no other US federal or state tax years subject to examination. |
Goodwill and Indefinite Lived Intangible Assets and Intangible Assets Subject to Amortization | Goodwill and Indefinite Lived Intangible Assets Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired in each business combination. In accordance with Accounting Standards Codification ("ASC") 350-20-35, Goodwill—Subsequent Measurement , the Company performs a quantitative approach method impairment review of goodwill and intangible assets with an indefinite life annually at October 1 and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Prior to 2019, the Company performed this test at October 31. As a result of the global economic impact and uncertainty due to COVID-19, the Company concluded a triggering event had occurred as of March 31, 2020, and accordingly, performed interim impairment testing on the goodwill balances of its reporting units. The Company performed a detailed qualitative and quantitative assessment of each reporting unit and concluded that the goodwill associated with the previously consolidated UK reporting unit was impaired as the fair value of the UK reporting unit was less than the carrying amount. The impairment loss of $9.3 million is included in Loss from discontinued operations due to the deconsolidation of ECIL. While there was a decline in the fair value of the Elastic reporting unit at March 31, 2020, there was no impairment identified during the quantitative assessment. The Company completed its annual test as of October 1, 2020 and determined that there was no evidence of impairment of goodwill or indefinite lived intangible assets. No events or circumstances occurred between October 1 and December 31, 2020 that would more likely than not reduce the fair value of the Elastic reporting unit below the carrying amount. Prior to the adoption of ASU No. 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment ("ASU 2017-04"), the Company’s impairment evaluation of goodwill was already based on comparing the fair value of the Company’s reporting units to their carrying value. The adoption of ASU 2017-04 as of January 1, 2020 had no impact on the Company's evaluation procedures. The fair value of the reporting units is determined based on a weighted average of the income and market approaches. The income approach establishes fair value based on estimated future cash flows of the reporting units, discounted by an estimated weighted-average cost of capital developed using the capital asset pricing model, which reflects the overall level of inherent risk of the reporting units. The income approach uses the Company’s projections of financial performance for a six Intangible Assets Subject to Amortization Intangible assets primarily include the fair value assigned to non-compete agreements at acquisition less any accumulated amortization. Non-compete agreements are amortized on a straight-line basis over the term of the agreement. An evaluation of the recoverability of intangible assets subject to amortization is performed whenever the facts and circumstances indicate that the carrying value may be impaired. An impairment loss is recognized if the future undiscounted cash flows associated with the asset and the estimated fair value of the asset are less than the asset’s corresponding carrying value. The amount of the impairment loss, if any, is the excess of the asset’s carrying value over its estimated fair value. No impairment losses related to intangible assets subject to amortization occurred during the years ended December 31, 2020, 2019 and 2018. |
Leases | Leases Prior to the implementation of ASC Topic 842, Leases , the Company recognized escalating lease payments on a straight-line basis over the term of each respective lease with the difference between cash payments and rent expense recorded as a deferred rent liability. The Company adopted the provisions of ASC Topic 842 on a prospective basis at January 1, 2019. The adoption of ASU 2016-02, as amended, resulted in the recognition of approximately $11.5 million and $15.4 million additional right of use assets and liabilities for operating leases, respectively, of which $10.3 million and $14.2 million related to continuing operations. Subsequent to initial adoption, the Company entered into additional leases for a total recognition in 2019 of $11.8 million and $16.0 million right of use assets and liabilities for operating leases in continuing operations, respectively. The Company did not enter into any leases in 2020. |
Debt Discount and Issuance Costs | Debt Discount and Issuance Costs Costs incurred for issuing the Notes payable are deferred and amortized using the straight-line method over the life of the related debt, which approximates the effective interest method. These costs include any debt discount or premium on the notes in addition to debt issuance costs incurred. The unamortized balance of debt issuance costs was approximately $2.1 million and $2.6 million at December 31, 2020 and 2019, respectively, and is included in Notes payable, net in the Consolidated Balance Sheets. Amortization of debt issuance costs of approximately $0.7 million, $0.6 million and $0.4 million was recognized for the years ended December 31, 2020, 2019 and 2018, respectively, and is included within Net interest expense in the Consolidated Income Statements. |
Comprehensive Income | Comprehensive Income Accumulated other comprehensive income, net is comprised of the impact of foreign currency translation adjustments in addition to unrealized gains (losses) on interest rate caps. The Company had the following reclassifications out of Accumulated other comprehensive income (loss), net: |
Concentration of Credit Risk | Concentration of Credit Risk The Company maintains cash and cash equivalent balances in bank deposit accounts that, at times, may exceed federally insured limits. The Company has not experienced any losses in such accounts. The Company believes it is not exposed to any significant credit risk on cash and cash equivalents. |
Fair Value Measurements | Fair Value Measurements The Company applies the provisions of ASC Topic 820, Fair Value Measurements and Disclosures |
Derivative Financial Instruments | Derivative Financial Instruments The Company applies the provisions of ASC Topic 815, Derivatives and Hedging. On January 11, 2018, the Company and ESPV each entered into one interest rate cap transaction with a counterparty to mitigate the floating rate interest risk on a portion of the debt underlying the Rise and Elastic portfolios, respectively. The interest rate caps matured on February 1, 2019. The interest rate caps were designated as cash flow hedges against expected future cash flows attributable to future interest payments on debt facilities held by each entity. The Company initially reported the gains or losses related to the hedges as a component of Accumulated other comprehensive income in the Consolidated Balance Sheets in the period incurred and subsequently reclassified the interest rate caps’ gains or losses to interest expense when the hedged expenses were recorded. The Company excluded the change in the time value of the interest rate caps in its assessment of their hedge effectiveness. The Company presented the cash flows from cash flow hedges in the same category in the Consolidated Statements of Cash Flows as the category for the cash flows from the hedged items. The interest rate caps did not contain any credit risk related contingent features. The Company’s hedging program is not designed for trading or speculative purposes. |
Transfers and Servicing of Financial Assets | Transfers and Servicing of Financial Assets The Company applies the provisions of ASC Topic 860, Transfers and Servicing , for accounting for transfers and servicing of financial assets, which requires that specific criteria are met in order to record a transfer of financial assets as a sale. To qualify for sale treatment, the guidance requires that the Company does not have continuing involvement with the sold assets and also requires the Company to no longer retain effective control of the assets. During the years ended December 31, 2020, 2019 and 2018, the Company entered into sales agreements with third-party firms whereby the Company sold charged off customer loans to the third party. The agreements meet the sale criteria, and as a result, proceeds of approximately $9.9 million, $21.5 million and $24.8 million for the years ended December 31, 2020, 2019 and 2018, respectively, were recorded as a recovery of charged off loans, inclusive of other recoveries, in the allowance for loan losses. |
Share-Based Compensation | Share-Based Compensation In accordance with ASC Topic 718, Compensation-Stock Compensation |
Treasury Stock | Treasury Stock The Company evaluates each stock repurchase transaction in the period in which it is completed. If the repurchase transaction is significantly in excess of the current market price at purchase, the Company will identify whether the price paid included payment for other agreements, rights, and privileges. Repurchase transactions that do not contain these elements or are not significantly in excess of the current market price at purchase are accounted for using the cost method. The Company anticipates using its treasury stock to fulfill certain employee stock compensation grants and settlements. The Company has elected to use a first in, first out ("FIFO") method for assigning share cost at reissuance. Any gain or loss in the stock value will be credited or charged to paid in capital upon subsequent reissuance of the shares, with losses in excess of previously recognized gains charged to retained earnings. The Company is not obligated to purchase or reissue any shares at any time in accordance with its previously disclosed share repurchase plan. |
Recently Adopted Accounting Standards and Accounting Standards to be Adopted in Future Periods | Recently Adopted Accounting Standards In February 2016, the FASB issued Accounting Standards Update ("ASU") No. 2016-02, Leases (Topic 842) ("ASU 2016-02"). ASU 2016-02 is intended to improve the reporting of leasing transactions to provide users of financial statements with more decision-useful information. ASU 2016-02 will require organizations that lease assets to recognize on the balance sheets the assets and liabilities for the rights and obligations created by those leases. In July 2018, the FASB issued ASU No. 2018-10, Codification Improvements to Topic 842, Leases (“ASU 2018-10”), which clarifies certain matters in the codification with the intention to correct unintended application of the guidance. Also in July 2018, the FASB issued ASU No. 2018-11, Leases (Topic 842): Targeted Improvements (“ASU 2018-11”), which provides entities with an additional (and optional) transition method whereby the entity applies the new lease standard at the adoption date and recognizes a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. Additionally, under the new transition method, an entity’s reporting for the comparative periods presented in the financial statements in which it adopts the new lease standard will continue to be in accordance with current US GAAP (Topic 840, Leases). ASU 2016-02, as amended, is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. The Company elected to adopt the transition method in ASU 2018-11 by applying the practical expedient prospectively at January 1, 2019. The Company also elected to apply the optional practical expedient package to not reassess existing or expired contracts for lease components, lease classification or initial direct costs. The adoption of ASU 2016-02 on January 1, 2019, as amended, resulted in the recognition of approximately $11.5 million right of use assets and $15.4 million liabilities for operating leases, of which $10.3 million and $14.2 million related to continuing operations, respectively, but did not have a material impact on the Company's Consolidated Income Statements. In July 2019, the FASB issued Accounting Standards Update ("ASU") No. 2019-07, Codification Updates to SEC Sections ("ASU 2019-07"). The purpose of ASU 2019-07 is to amend various SEC paragraphs pursuant to the issuance of SEC Final Rule Releases No. 33-10532, Disclosure Update and Simplification, and Nos. 33-10231 and 33-10442, Investment Company Reporting Modernization. Among other revisions, the amendments reduce duplication and clarify the inclusion of comprehensive income. The Company has adopted all of the amendments of ASU 2019-07 as of July 2019 with no impact to the Company's consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract ("ASU 2018-15"). The purpose of ASU 2018-15 is to provide additional guidance on the accounting for costs of implementation activities performed in a cloud computing arrangement that is a service contract. This guidance is effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. The Company elected to adopt this ASU prospectively as of January 1, 2020 and has implemented a control structure to identify cloud computing arrangements for appropriate accounting treatment similar to its procedures for right of use assets. At December 31, 2020, the Company has capitalized implementation costs associated with cloud computing arrangements of $1.0 million. At adoption, ASU 2018-15 did not have a material impact on the Company's consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement ("ASU 2018-13"). The purpose of ASU 2018-13 is to modify the disclosure requirements on fair value measurements in Topic 820, Fair Value Measurement. This guidance is effective for public companies for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years and requires both a prospective and retrospective approach to adoption based on amendment specifications. Early adoption of any removed or modified disclosures is permitted. Additional disclosures may be delayed until their effective date. The adoption of ASU 2018-13 at January 1, 2020 did not have a material impact on the Company's consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment ("ASU 2017-04"). The purpose of ASU 2017-04 is to simplify the subsequent measurement of goodwill. The amendments modify the concept of impairment from the condition that exists when the carrying amount of goodwill exceeds its implied fair value to the condition that exists when the carrying amount of a reporting unit exceeds its fair value. An entity no longer will determine goodwill impairment by calculating the implied fair value of goodwill by assigning the fair value of a reporting unit to all of its assets and liabilities as if that reporting unit had been acquired in a business combination. This guidance is effective for public companies for goodwill impairment tests in fiscal years beginning after December 15, 2019. The Company has adopted all of the amendments of ASU 2017-04 as of January 2020 with no impact to the Company's consolidated financial statements. The Company used the simplified subsequent measurement requirements per ASU 2017-04 in its impairment analysis at March 31, 2020 and October 1, 2020. On March 27, 2020, the CARES Act was enacted in response to COVID-19. Among other things, the CARES Act provides income tax relief inclusive of permitting NOL carryovers and carrybacks to offset 100% of taxable income for taxable years beginning before 2021. In addition, the CARES Act allows NOLs incurred in 2018, 2019, and 2020 to be carried back to each of the five preceding taxable years to generate a refund of previously paid income taxes. The Company has reviewed the tax relief provisions of the CARES Act regarding its eligibility and determined that the impact is likely to be insignificant with regard to its effective tax rate. Certain portions of the CARES Act were amended by the CAA on December 27, 2020. The Company continues to monitor and evaluate its eligibility for the amended CARES Act tax relief provisions to identify any that may become applicable in the future. Accounting Standards to be Adopted in Future Periods In March 2020, the FASB issued ASU No. 2020-03, Codification Improvements to Financial Instruments ("ASU 2020-03"). The purpose of ASU 2020-03 is to clarify, correct errors in or make minor improvements to the codification. Among other revisions, the amendments clarify that an entity should record an allowance for credit losses when an entity regains control of financial assets sold in accordance with Topic 326. ASU 2020-03 also clarifies disclosure requirements for debt securities under Topic 942 and affirms that all entities are required to provide the fair value option disclosures within paragraphs 825-10-50-24 through 50-32 of the codification. The amendments in this update are effective on the latter of the issuance of ASU 2020-03 or the effective date of their related topic. The Company does not anticipate the adoption of ASU 2020-03 to have a material impact on the Company's consolidated financial statements. In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting ("ASU 2020-04"). The purpose of ASU 2020-04 is to provide optional guidance for a period of time related to accounting for reference rate reform on financial reporting. It is intended to reduce the potential burden of reviewing contract modifications related to discontinued rates. The amendments and expedients in this update are effective as of March 12, 2020 through December 31, 2022 and may be elected by topic. The Company is assessing the potential impact of electing all or portions of ASU 2020-04 on the Company's consolidated financial statements. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes ("ASU 2019-12"). The purpose of ASU 2019-12 is to reduce complexity in the accounting standards for income taxes by removing certain exceptions as well as clarifying certain allocations. This update also addresses the split recognition of franchise taxes that are partially based on income between income-based tax and non-income-based tax. This guidance is effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. Early adoption is permitted. The Company is still assessing the potential impact of ASU 2019-12 on the Company's consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments ("ASU 2016-13"). ASU 2016-13 is intended to replace the incurred loss impairment methodology in current US GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates to improve the quality of information available to financial statement users about expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. In April 2019, the FASB issued ASU No. 2019-04, Codification Improvements to Topic 326, Financial Instruments ("ASU 2019-04"). This amendment clarifies the guidance in ASU 2016-13. The guidance in ASU 2016-13 was further clarified by ASU No. 2019-11, Codification Improvements to Topic 326, Financial Instrument s ("ASU 2019-11") issued in November 2019. ASU 2019-11 provides transition relief such as permitting entities an accounting policy election regarding existing TDRs, among other things. In May 2019, the FASB issued ASU No. 2019-05, Financial Instruments-Credit Losses (Topic 326): Targeted Transition Relief ("ASU 2019-05"). The purpose of this amendment is to provide entities that have certain instruments within the scope of Subtopic 326-20, Financial Instruments-Credit Losses-Measured at Amortized Cost, with an option to irrevocably elect the fair value option in Subtopic 825-10, Financial Instruments-Overall, on an instrument-by-instrument basis. Election of this option is intended to increase comparability of financial statement information and reduce costs for certain entities to comply with ASU 2016-13. For public entities, ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. In November 2019, the FASB issued ASU No. 2019-10, Financial Instruments - Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842): Effective Dates ("ASU 2019-10"). The purpose of this amendment is to create a two-tier rollout of major updates, staggering the effective dates between larger public companies and all other entities. This granted certain classes of companies, including Smaller Reporting Companies ("SRCs"), additional time to implement major FASB standards, including ASU 2016-13. Larger public companies will still have an effective date for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. All other entities are permitted to defer adoption of ASU 2016-13, and its related amendments, until the earlier of fiscal periods beginning after December 15, 2022. In February 2020, the FASB issued ASU No. 2020-02, Financial Instruments - Credit Losses (Topic 326), and Leases (Topic 842): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 119 and Update to SEC Section on Effective Date Related to Accounting Standards Update No. 2016-12 ("ASU 2020-02"). ASU 2020-02 updates the SEC staff guidance related to ASU 2016-13 and all contingent amendments. Under the current SEC definitions, the Company meets the definition of an SRC as of the ASU 2019-10 issuance date and is adopting the deferral period for ASU 2016-13. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Receivables (payables) related to the CSO lenders | The receivables (payables) related to the CSO lenders as of December 31, 2020 and 2019 are as follows: (Dollars in thousands) 2020 2019 Receivable related to 25%-45% cash reserve $ 1,333 $ 8,648 Receivable (payable) related to CSO fees collected by CSO lenders (78) (9) Receivable related to licensing and servicing arrangements with CSO lenders 0 57 Total receivable from CSO lenders $ 1,255 $ 8,696 |
Property and equipment | Software development costs, which are included in Property and equipment, net on the Consolidated Balance Sheets, as of December 31, 2020 and 2019, and related amortization expense, which is included in Depreciation and amortization within the Consolidated Income Statements for the years ended December 31, 2020 and 2019 were as follows: (Dollars in thousands) 2020 2019 Software development costs $ 79,200 $ 64,196 Less: accumulated amortization (53,265) (39,036) Net book value $ 25,935 $ 25,160 Amortization expense $ 14,229 $ 9,961 Furniture and fixtures 7 years Equipment 3-5 years Leasehold improvements The lesser of the related lease term or useful life of 3-5 years Software and software development 3 years Property and equipment as of December 31, 2020 and 2019 consists of the following: (Dollars in thousands) 2020 2019 Furniture and fixtures $ 4,288 $ 4,315 Equipment 15,323 14,453 Leasehold improvements 8,310 8,301 Software development cost 79,200 64,196 Software-purchased 9,627 9,501 116,748 100,766 Less accumulated depreciation (82,748) (64,822) $ 34,000 $ 35,944 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Computation of earnings (loss) per share | The computation of earnings (loss) per share was as follows for years ended December 31, 2020, 2019 and 2018: Years Ended December 31, (Dollars in thousands except share and per share amounts) 2020 2019 2018 Numerator (basic and diluted): Net income from continuing operations $ 36,202 $ 26,196 $ 13,750 Net income (loss) from discontinued operations (15,610) 5,987 (1,241) Net income $ 20,592 $ 32,183 $ 12,509 Denominator (basic): Basic weighted-average number of shares outstanding 40,926,581 43,805,845 42,791,061 Denominator (diluted): Basic weighted-average number of shares outstanding 40,926,581 43,805,845 42,791,061 Effect of potentially dilutive securities: Employee stock plans (options, RSUs and ESPP) 835,042 532,360 1,508,243 Diluted weighted-average number of shares outstanding 41,761,623 44,338,205 44,299,304 Basic and diluted earnings per share: Continuing operations $ 0.88 $ 0.60 $ 0.32 Discontinued operations (0.38) 0.13 (0.03) Basic earnings per share $ 0.50 $ 0.73 $ 0.29 Continuing operations $ 0.87 $ 0.59 $ 0.31 Discontinued operations (0.38) 0.14 (0.03) Diluted earnings per share $ 0.49 $ 0.73 $ 0.28 |
Loans Receivable and Revenues (
Loans Receivable and Revenues (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Receivables [Abstract] | |
Revenue from consumer loans | Revenues generated from the Company’s consumer loans for the years ended December 31, 2020, 2019 and 2018 were as follows: (Dollars in thousands) 2020 2019 2018 Finance charges $ 274,025 $ 348,537 $ 345,003 Lines of credit fees 173,528 247,398 254,561 CSO fees 16,530 40,835 60,221 Other 1,263 2,103 3,931 Total revenues $ 465,346 $ 638,873 $ 663,716 |
Schedule of loans receivable | The following reflects the credit quality of the Company’s loans receivable as of December 31, 2020 and 2019 as delinquency status has been identified as the primary credit quality indicator. The Company classifies its loans as either current or past due. A customer in good standing may request up to a 16-day grace period when or before a payment becomes due and, if granted, the loan is considered current during the grace period. In response to the COVID-19 pandemic, the Company, along with the banks it supports, has also expanded existing payment flexibility programs to provide temporary payment relief to certain customers who meet the program’s qualifications. These programs allow for a deferral of payments for an initial period of 30 to 60 days, which the Company may extend for an additional 30 days, generally for a maximum of 180 days on a cumulative basis. A customer will return to the normal payment schedule after the end of the deferral period, with the extension of the maturity date equivalent to the deferral period, which is generally not to exceed an additional 180 days. Customers that were 30 days past due or less as of March 1, 2020 or the date the customer requested the deferral are considered current. Customers more than 30 days past due as of March 1, 2020 or the date the customer requested the deferral are considered delinquent. As of December 31, 2020, 8.7% of customers have been provided relief through a COVID-19 payment deferral program for a total of $34.6 million in loans with deferred payments primarily reported in current status. The Company believes that the allowance for loan losses is adequate to absorb the losses inherent in the total portfolio as of December 31, 2020. Installment loans, lines of credit and credit cards are considered past due if a grace period has not been requested and a scheduled payment is not paid on its due date. All impaired loans that were not accounted for as a TDR as of December 31, 2020 and 2019 have been charged off. December 31, 2020 (Dollars in thousands) Rise Elastic Today Total Current loans $ 222,937 $ 154,950 $ 12,954 $ 390,841 Past due loans 22,383 6,926 1,564 30,873 Total loans receivable 245,320 161,876 14,518 421,714 Net unamortized loan premium 239 1,278 — 1,517 Less: Allowance for loan losses (33,288) (13,201) (1,910) (48,399) Loans receivable, net $ 212,271 $ 149,953 $ 12,608 $ 374,832 December 31, 2019 (Dollars in thousands) Rise Elastic Today Total Current loans $ 307,408 $ 239,941 $ 3,439 $ 550,788 Past due loans 46,386 21,285 1,108 68,779 Total loans receivable 353,794 261,226 4,547 619,567 Net unamortized loan premium 290 2,128 — 2,418 Less: Allowance for loan losses (50,019) (28,852) (1,041) (79,912) Loans receivable, net $ 304,065 $ 234,502 $ 3,506 $ 542,073 |
Changes in the allowance for loan losses | The changes in the allowance for loan losses for the years ended December 31, 2020, 2019 and 2018 are as follows: December 31, 2020 (Dollars in thousands) Rise Elastic Today Total Balance beginning of year $ 52,099 $ 28,852 $ 1,041 $ 81,992 Provision for loan losses 108,105 45,988 2,817 156,910 Charge-offs (140,616) (67,300) (2,030) (209,946) Recoveries of prior charge-offs 14,380 5,661 82 20,123 Total 33,968 13,201 1,910 49,079 Accrual for CSO lender owned loans (Note 1) (680) — — (680) Balance end of year $ 33,288 $ 13,201 $ 1,910 $ 48,399 December 31, 2019 (Dollars in thousands) Rise Elastic Today Total Balance beginning of year $ 50,597 $ 36,019 $ 31 $ 86,647 Provision for loan losses 207,079 116,462 2,121 325,662 Charge-offs (226,227) (134,362) (1,122) (361,711) Recoveries of prior charge-offs 20,650 10,733 11 31,394 Total 52,099 28,852 1,041 81,992 Accrual for CSO lender owned loans (Note 1) (2,080) — — (2,080) Balance end of year $ 50,019 $ 28,852 $ 1,041 $ 79,912 December 31, 2018 (Dollars in thousands) Rise Elastic Today Total Balance beginning of year $ 55,867 $ 28,869 $ — $ 84,736 Provision for loan losses 223,298 138,869 31 362,198 Charge-offs (250,623) (142,863) — (393,486) Recoveries of prior charge-offs 22,055 11,144 — 33,199 Total 50,597 36,019 31 86,647 Accrual for CSO lender owned loans (Note 1) (4,444) — — (4,444) Balance end of year $ 46,153 $ 36,019 $ 31 $ 82,203 |
Troubled debt restructurings | The following table summarizes the financial effects, excluding impacts related to credit loss allowance and impairment, of TDRs that occurred for the years ended December 31, 2020, 2019, and 2018: (Dollars in thousands) 2020 2019 2018 Outstanding recorded investment before TDR $ 30,378 $ 32,040 $ 26,683 Outstanding recorded investment after TDR 29,492 29,689 24,421 Total principal and interest forgiveness included in charge-offs within the allowance for loan loss $ 886 $ 2,351 $ 2,262 (Dollars in thousands) 2020 2019 2018 Average outstanding recorded investment(1) $ 21,828 $ 15,010 $ 9,132 Interest income recognized $ 12,560 $ 11,013 $ 14,056 1. Simple average as of December 31, 2020, 2019, and 2018, respectively. The table below presents the Company’s loans modified in TDRs as of December 31, 2020 and 2019: (Dollars in thousands) 2020 2019 Current outstanding investment $ 21,261 $ 11,313 Delinquent outstanding investment 5,532 5,549 Outstanding recorded investment 26,793 16,862 Less: Impairment included in Allowance for loan losses (7,133) (3,664) Outstanding recorded investment, net of impairment $ 19,660 $ 13,198 |
Variable Interest Entities (Tab
Variable Interest Entities (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of the assets and liabilities of the VIE | The following table summarizes the assets and liabilities of the VIE that are included within the Company’s Consolidated Balance Sheets at December 31, 2020 and 2019: (Dollars in thousands) 2020 2019 ASSETS Cash and cash equivalents $ 97,345 $ 26,245 Loans receivable, net of allowance for loan losses of $13,202 and $28,852, respectively 149,951 234,504 Receivable from payment processors 3,652 6,363 Total assets $ 250,948 $ 267,112 LIABILITIES AND SHAREHOLDER'S EQUITY Accounts payable and accrued liabilities ($23,337 and $7,690, respectively, eliminates upon consolidation) $ 27,663 $ 15,902 Deferred revenue 2,300 4,280 Reserve deposit liability ($23,150 and $23,150, respectively, eliminates upon consolidation) 23,150 23,150 Notes payable, net 197,835 223,780 Total liabilities and shareholder’s equity $ 250,948 $ 267,112 The following table summarizes the assets and liabilities of the VIE that are included within the Company’s Consolidated Balance Sheets at December 31, 2020 and 2019: (Dollars in thousands) 2020 2019 ASSETS Cash and cash equivalents $ 35,450 $ 7,541 Loans receivable, net of allowance for loan losses of $14,342 and $17,436, respectively 83,869 111,281 Receivable from payment processors ($231 and $0 eliminates upon consolidation) 713 681 Total assets $ 120,032 $ 119,503 LIABILITIES AND SHAREHOLDER'S EQUITY Accounts payable and accrued liabilities ($16,459 and $7,114, respectively, eliminates upon consolidation) $ 17,599 $ 8,576 Reserve deposit liability ($8,950 and $8,950, respectively, eliminates upon consolidation) 8,950 8,950 Notes payable, net 93,483 101,977 Total liabilities and shareholder's equity $ 120,032 $ 119,503 The following table summarizes the assets and liabilities of the VIE that are included within the Company’s Consolidated Balance Sheets at December 31, 2020: (Dollars in thousands) 2020 ASSETS Cash and cash equivalents $ 9,377 Restricted cash 1,000 Loans receivable, net of allowance for loan losses of $1,634 19,231 Receivable from payment processors ($6 eliminates upon consolidation) 211 Total assets $ 29,819 LIABILITIES AND SHAREHOLDER’S EQUITY Accounts payable and accrued liabilities ($803 eliminates upon consolidation) $ 1,541 Reserve deposit liability ($3,500 eliminates upon consolidation) 3,500 Notes payable, net 24,778 Total liabilities and shareholder’s equity $ 29,819 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property and equipment | Software development costs, which are included in Property and equipment, net on the Consolidated Balance Sheets, as of December 31, 2020 and 2019, and related amortization expense, which is included in Depreciation and amortization within the Consolidated Income Statements for the years ended December 31, 2020 and 2019 were as follows: (Dollars in thousands) 2020 2019 Software development costs $ 79,200 $ 64,196 Less: accumulated amortization (53,265) (39,036) Net book value $ 25,935 $ 25,160 Amortization expense $ 14,229 $ 9,961 Furniture and fixtures 7 years Equipment 3-5 years Leasehold improvements The lesser of the related lease term or useful life of 3-5 years Software and software development 3 years Property and equipment as of December 31, 2020 and 2019 consists of the following: (Dollars in thousands) 2020 2019 Furniture and fixtures $ 4,288 $ 4,315 Equipment 15,323 14,453 Leasehold improvements 8,310 8,301 Software development cost 79,200 64,196 Software-purchased 9,627 9,501 116,748 100,766 Less accumulated depreciation (82,748) (64,822) $ 34,000 $ 35,944 |
Accounts Payable and Accrued _2
Accounts Payable and Accrued Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Payables and Accruals [Abstract] | |
Accounts payable and accrued liabilities | Accounts payable and accrued liabilities at December 31, 2020 and 2019 consist of the following: (Dollars in thousands) 2020 2019 Accounts payable $ 7,568 $ 10,604 Accrued compensation 15,326 15,644 Liability for losses on CSO lender-owned consumer loans 680 2,080 Interest payable 3,852 4,691 Other accrued liabilities 24,826 5,660 $ 52,252 $ 38,679 |
Notes Payable, Net (Tables)
Notes Payable, Net (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Outstanding balance of notes payable, net of debt issuance costs | The outstanding balance of Notes payable, net of debt issuance costs, for the years ended December 31, 2020 and 2019 are as follows: (Dollars in thousands) 2020 2019 US Term Note bearing interest at the base rate + 7.25% (2020) or + 7.5% (2019) $ 104,500 $ 182,000 4 th Tranche Term Note bearing interest at the base rate + 13% 18,050 18,050 ESPV Term Note bearing interest at the base rate + 7.25% (2020) or 7.5% (2019) 199,500 226,000 EF SPV Term Note bearing interest at the base rate + 7.25% (2020) or + 7.5% (2019) 93,500 102,000 EC SPV Term Note bearing interest at the base rate + 7.25% 25,000 — Debt issuance costs (2,147) (2,611) Total $ 438,403 $ 525,439 |
Future debt maturities | The following table presents the future debt maturities as of December 31, 2020: Year (dollars in thousands) December 31, 2020 2021 $ 18,050 2022 — 2023 — 2024 422,500 2025 — Thereafter — Total $ 440,550 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Carrying value of acquired finite-lived intangible assets | The carrying value of acquired intangible assets as of December 31, 2020 is presented in the table below: (Dollars in thousands) Cost Accumulated Net Assets subject to amortization: Acquired technology $ 211 $ (211) $ — Non-compete 2,461 (1,859) 602 Customers 126 (126) — Assets not subject to amortization: Domain names 531 — 531 $ 3,329 $ (2,196) $ 1,133 The carrying value of acquired intangible assets as of December 31, 2019 is presented in the table below: (Dollars in thousands) Cost Accumulated Net Assets subject to amortization: Acquired technology $ 211 $ (211) $ — Non-compete 2,461 (1,739) 722 Customers 126 (126) — Assets not subject to amortization: Domain names 531 — 531 $ 3,329 $ (2,076) $ 1,253 |
Carrying value of acquired indefinite-lived intangible assets | The carrying value of acquired intangible assets as of December 31, 2020 is presented in the table below: (Dollars in thousands) Cost Accumulated Net Assets subject to amortization: Acquired technology $ 211 $ (211) $ — Non-compete 2,461 (1,859) 602 Customers 126 (126) — Assets not subject to amortization: Domain names 531 — 531 $ 3,329 $ (2,196) $ 1,133 The carrying value of acquired intangible assets as of December 31, 2019 is presented in the table below: (Dollars in thousands) Cost Accumulated Net Assets subject to amortization: Acquired technology $ 211 $ (211) $ — Non-compete 2,461 (1,739) 722 Customers 126 (126) — Assets not subject to amortization: Domain names 531 — 531 $ 3,329 $ (2,076) $ 1,253 |
Estimated amortization expense relating to intangible assets subject to amortization | Estimated amortization expense relating to intangible assets subject to amortization for the succeeding five years is as follows: Year (dollars in thousands) Amount 2021 120 2022 120 2023 120 2024 120 2025 120 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Summary of total lease cost and supplemental cash flow information | Total lease cost recognized after the adoption of ASC 842 for the years ended December 31, 2020 and 2019, as included in Occupancy and equipment in the Consolidated Income Statements, is detailed in the table below. Year ended December 31, Lease cost (dollars in thousands) 2020 2019 Operating lease cost $ 3,231 $ 3,138 Short-term lease cost — 22 Total lease cost $ 3,231 $ 3,160 Further information related to leases is as follows: Year ended December 31, Supplemental cash flows information (dollars in thousands) 2020 2019 Cash paid for amounts included in the measurement of lease liabilities $ 3,760 $ 3,135 Right-of-use assets obtained in exchange for lease obligations $ — $ 1,110 Weighted-average remaining lease term 3.6 years 4.5 years Weighted-average discount rate 10.23 % 10.23 % |
Future minimum lease payments for operating leases | Future minimum lease payments as of December 31, 2020 are as follows: Year (dollars in thousands) Amount 2021 $ 3,876 2022 3,984 2023 3,486 2024 1,438 2025 1,254 Thereafter 638 Total future minimum lease payments $ 14,676 Less: Imputed interest (2,724) Operating lease liabilities $ 11,952 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Assumptions used to determine fair value of options granted | The assumptions used to determine the fair value of options granted in the years ended December 31, 2020 and 2019 using the Black-Scholes-Merton model are as follows: 2020 2019 Dividend yield 0 % 0 % Risk-free interest rate 0.53 % 1.43% to 2.47% Expected volatility (weighted-average and range, if applicable) 52 % 55% (52% to 55%) Expected term 7 years 7 years |
Summary of stock option activity | A summary of stock option activity as of and for the year ended December 31, 2020 is presented below: Stock Options Shares Weighted-Average Weighted-Average Remaining Contractual Life (in years) Outstanding at December 31, 2019 2,269,178 $ 4.58 Granted 55,161 3.39 Exercised (1) (712,500) 2.13 Expired (25,000) 2.13 Canceled/Forfeited (700,154) 5.32 Outstanding at December 31, 2020 886,685 5.94 3.94 Options exercisable at December 31, 2020 886,685 $ 5.94 3.94 (1) During the year ended December 31, 2020, certain options were net share-settled to cover the required withholding tax and the remaining amounts were converted into an equivalent number of shares of the Company's common stock. The Company withheld 511,920 shares for applicable income and other employment taxes and remitted the cash to the appropriate taxing authorities. |
Options outstanding at respective exercise price | At December 31, 2020, the following options were outstanding at their respective exercise price: Exercise Price Options Outstanding $2.13 25,000 $4.29 - 4.57 200,000 $5.15 - 5.59 226,687 $6.31 243,821 $8.08 - 8.32 191,177 Total 886,685 |
Summary of RSUs activity | A summary of RSU activity as of and for the year ended December 31, 2020 is presented below: RSUs Shares Weighted-Average Unvested at December 31, 2019 4,161,862 $ 6.10 Granted 1,258,059 1.65 Vested (1) (1,559,107) 6.41 Canceled/Forfeited (936,728) 5.64 Unvested at December 31, 2020 2,924,086 4.17 Expected to vest at December 31, 2020 2,355,775 $ 4.28 (1) During the year ended December 31, 2020, certain RSUs were net share-settled to cover the required withholding tax and the remaining amounts were converted into an equivalent number of shares of the Company's common stock. The Company withheld 316,254 shares for applicable income and other employment taxes and remitted the cash to the appropriate taxing authorities. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of interest rate caps | The following tables summarize these interest rate caps as of and for the years ended December 31, 2019 and 2018 (dollars in thousands) and no activity related to interest rate caps was incurred for the year ended December 31, 2020: Unrecognized gains recognized in Accumulated other comprehensive income Year ended December 31, 2019 Year Ended December 31, 2018 US Term Note interest rate cap $ — $ 159 ESPV Facility interest rate cap — 144 $ — $ 303 Gains recognized in Interest expense Year ended December 31, 2019 Year Ended December 31, 2018 US Term Note interest rate cap $ 159 $ 1,272 ESPV Facility interest rate cap 144 1,145 $ 303 $ 2,417 |
Derivatives (Tables)
Derivatives (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Summary of activity recorded in Accumulated other comprehensive income and reclassifications into earnings | The following table summarizes the activity that was recorded in Accumulated other comprehensive income (loss) in addition to reclassifications from Accumulated other comprehensive income (loss) into earnings related to each of the Company's and ESPV's interest rate caps during the years ended December 31, 2019 and 2018. Year ended December 31, 2019 Year Ended December 31, 2018 (Dollars in thousands) US Term Note ESPV Facility US Term Note ESPV Facility Beginning unrealized gains in Accumulated other comprehensive income $ 159 $ 144 $ — $ — Gross gains recognized in Accumulated other comprehensive income — — 1,431 1,289 Gains reclassified to income through Interest expense (159) (144) (1,272) (1,145) Ending unrealized gains in Accumulated other comprehensive income $ — $ — $ 159 $ 144 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income tax expense (benefit) | Income tax expense for the years ended December 31, 2020, 2019 and 2018 consists of the following: (Dollars in thousands) 2020 2019 2018 Current income tax expense (benefit): Federal $ — $ — $ (5) State (350) 576 150 Total current income tax expense (350) 576 145 Deferred income tax expense (benefit): Federal 10,985 9,643 326 State 275 1,940 (97) Total deferred income tax expense 11,260 11,583 229 Total income tax expense $ 10,910 $ 12,159 $ 374 |
Income tax rate reconciliation | The differences between the provision for income tax and the amount that would result if the federal statutory rate were applied to the pre-tax financial income for the years ended December 31, 2020, 2019 and 2018 were as follows: (Dollars in thousands) 2020 2019 2018 Federal statutory rate of 21% $ 9,894 $ 8,054 $ 2,966 State income tax provision (377) 1,611 579 Permanent differences 2,242 2,462 225 Change in federal statutory rate - US tax reform — — (970) Research and development credit (1,757) (860) (2,493) Other 908 892 67 Total $ 10,910 $ 12,159 $ 374 |
Deferred tax assets and liabilities | The tax effects of temporary differences that give rise to significant portions of deferred tax assets and deferred tax liabilities at December 31, 2020 and 2019 are presented below: (Dollars in thousands) 2020 2019 Deferred Tax Assets: Allowance for losses on loans receivable $ 4,600 $ 8,450 Net operating loss carryforward 15,954 196 Research and development credit 5,765 3,139 Deferred equity compensation costs 1,244 2,130 Accrued expenses 8,279 3,426 Deferred equity issuance costs 26 23 Other 1,165 671 Total deferred tax assets 37,033 18,035 Deferred Tax Liabilities: Property and equipment, principally due to differences in depreciation (2,037) (609) Amortization of intangible assets (7,486) (7,416) Prepaid expenses (1,552) (1,226) Net deferred tax assets before valuation allowance 25,958 8,784 Valuation allowance — — Deferred tax assets, net $ 25,958 $ 8,784 |
Commitments, Contingencies an_2
Commitments, Contingencies and Guarantees (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Rollforward of amounts accrued | The table below presents a rollforward of the amounts accrued for the year ended December 31, 2020. (Dollars in thousands) Year ended December 31, 2020 Beginning balance at December 31, 2019 $ — Expected loss accrual 7,065 Payments made $ (2,641) Net contingent loss accrual related to a legal matter at December 31, 2020 $ 4,424 |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued operations, income statement and balance sheet disclosures | The table below presents the financial results of ECIL, which are considered Discontinued operations and are excluded from the Company's results of continuing operations: Years Ended December 31 (Dollars in thousands) 2020 (1) 2019 2018 Revenues $ 24,012 $ 108,089 $ 122,966 Cost of sales: Provision for loan losses 4,785 38,579 49,780 Direct marketing costs 1,372 12,735 22,882 Other cost of sales 10,790 18,763 14,220 Total cost of sales 16,947 70,077 86,882 Gross profit 7,065 38,012 36,084 Operating expenses: Compensation and benefits 4,785 13,653 13,524 Professional services 2,879 4,881 6,040 Selling and marketing 605 2,608 3,241 Occupancy and equipment 2,141 4,723 3,733 Depreciation and amortization 1,427 1,501 1,512 Other 288 792 932 Total operating expenses 12,125 28,158 28,982 Operating (loss) income (5,060) 9,854 7,102 Other expense: Net interest expense (896) (4,113) (5,900) Foreign currency transaction loss (854) 334 (1,409) Impairment loss (9,251) — — Total other expense (11,001) (3,779) (7,309) Gain (loss) from operations of discontinued operations (16,061) 6,075 (207) Loss on disposal of discontinued operations (27,983) — — Gain (loss) from discontinued operations before taxes (44,044) 6,075 (207) Income tax benefit (expense) 28,434 (88) (1,034) Net income (loss) from discontinued operations $ (15,610) $ 5,987 $ (1,241) (1) Includes ECIL financial results for the period through June 28, 2020. The table below presents the aggregate carrying amounts of the assets and liabilities of ECIL and those carried by the Company as discontinued operations related to ECIL: (Dollars in thousands except share amounts) December 31, December 31, ASSETS Cash and cash equivalents $ — $ 17,698 Restricted cash — 59 Loans receivable, net of allowance for loan losses of $0 and $7,083, respectively — 31,604 Prepaid expenses and other assets — 4,871 Receivable from payment processors — 1,970 Deferred tax assets, net — 1,355 Property and equipment, net — 14,045 Goodwill, net — 9,251 Intangible assets, net — 149 Total assets classified as discontinued operations in the Consolidated Balance Sheets $ — $ 81,002 LIABILITIES AND STOCKHOLDERS’ EQUITY Accounts payable and accrued liabilities $ — $ 6,917 Notes payable, net — 29,624 Total liabilities classified as discontinued operations in the Consolidated Balance Sheets $ — $ 36,541 |
Related Parties (Tables)
Related Parties (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Related Party Transactions [Abstract] | |
Expenses related to board of directors | These expenses for the years ended December 31, 2020, 2019 and 2018 were as follows: Years Ended December 31, (Dollars in thousands) 2020 2019 2018 Fees and travel expenses $ 475 $ 532 $ 543 Stock compensation 1,693 2,361 1,311 Consulting 150 300 300 Total board related expenses $ 2,318 $ 3,193 $ 2,154 |
Quarterly Financial Data (Una_2
Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |
Summary of quarterly results of operations | The following is a summary of the quarterly results of operations for the years ended December 31, 2020 and 2019 (in thousands, except share and per share data): (Dollars in thousands, except share and per share amounts) First Quarter Second Quarter Third Quarter Fourth Quarter 2020 Total revenue $ 162,467 $ 117,991 $ 94,164 $ 90,724 Total cost of sales 92,214 43,428 17,421 32,253 Gross profit $ 70,253 $ 74,563 $ 76,743 $ 58,471 Net income (loss) from continuing operations $ 7,922 $ 16,093 $ 16,616 $ (4,429) Net income (loss) from discontinued operations (12,833) (7,540) 4,465 298 Net income (loss) $ (4,911) $ 8,553 $ 21,081 $ (4,131) Basic earnings per share - continuing operations $ 0.18 $ 0.38 $ 0.41 $ (0.11) Basic earnings per share - discontinued operations (0.29) (0.18) 0.11 0.01 Basic earnings (loss) per share $ (0.11) $ 0.20 $ 0.52 $ (0.10) Diluted earnings per share - continuing operations $ 0.18 $ 0.38 $ 0.41 $ (0.11) Diluted earnings per share - discontinued operations (0.29) (0.18) 0.11 0.01 Diluted earnings (loss) per share $ (0.11) $ 0.20 $ 0.52 $ (0.10) Basic weighted-average shares outstanding 43,161,716 42,182,412 40,230,256 38,851,781 Diluted weighted-average shares outstanding 43,161,716 42,511,808 40,762,330 38,851,781 2019 Total revenue $ 160,066 $ 150,374 $ 164,296 $ 164,137 Total cost of sales 84,830 81,864 105,076 102,523 Gross profit $ 75,236 $ 68,510 $ 59,220 $ 61,614 Net income from continuing operations $ 10,955 $ 8,383 $ 2,648 $ 4,210 Net income (loss) from discontinued operations 2,403 (2,611) 2,116 4,079 Net income $ 13,358 $ 5,772 $ 4,764 $ 8,289 Basic earnings per share - continuing operations $ 0.25 $ 0.19 $ 0.06 $ 0.10 Basic earnings per share - discontinued operations 0.06 (0.06) 0.05 0.09 Basic earnings per share $ 0.31 $ 0.13 $ 0.11 $ 0.19 Diluted earnings per share - continuing operations $ 0.25 $ 0.19 $ 0.06 $ 0.09 Diluted earnings per share - discontinued operations 0.05 (0.06) 0.05 0.10 Diluted earnings per share $ 0.30 $ 0.13 $ 0.11 $ 0.19 Basic weighted-average shares outstanding 43,348,249 43,681,159 44,169,964 44,009,459 Diluted weighted-average shares outstanding 43,875,410 44,291,816 44,743,944 44,587,331 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Narrative (Details) | Mar. 31, 2020USD ($) | Sep. 30, 2020USD ($) | Dec. 31, 2020USD ($)statecountry | Dec. 31, 2020USD ($)segmentstatecountry | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Jan. 01, 2019USD ($) | |
Class of Stock [Line Items] | ||||||||
Accounts payable and accrued liabilities | [1] | $ 52,252,000 | $ 52,252,000 | $ 38,679,000 | ||||
Amortization of loan premium | $ 4,600,000 | 5,998,000 | $ 6,179,000 | |||||
Threshold period past due for write-off | 60 days | 60 days | ||||||
Loans, grace period before past due | 16 days | |||||||
Due from processing providers | $ 6,100,000 | $ 6,100,000 | 8,700,000 | |||||
Number of reportable segments | segment | 1 | |||||||
Number of countries in which entity operates in | country | 1 | 1 | ||||||
Impairment of goodwill | $ 0 | |||||||
Impairment losses, intangible assets subject to amortization | $ 0 | 0 | 0 | |||||
Right of use assets | $ 8,320,000 | 8,320,000 | 10,191,000 | |||||
Operating lease liabilities | 11,952,000 | 11,952,000 | 14,352,000 | |||||
Operating lease right of use assets recognized | 0 | 11,809,000 | 0 | |||||
Operating lease liabilities recognized | 0 | 15,966,000 | 0 | |||||
Unamortized debt issuance costs | 2,100,000 | 2,100,000 | 2,600,000 | |||||
Amortization of debt issuance costs | 718,000 | 621,000 | 360,000 | |||||
Reclassification of Cumulative translation adjustment to Net loss from discontinued operations | 2,334,000 | 0 | 0 | |||||
Reclassification of net loss from discontinued operations, tax benefit | 1,369,000 | 0 | 0 | |||||
Total other comprehensive income (loss), net of tax | (1,096,000) | 1,042,000 | (1,949,000) | |||||
Certain stranded tax effects reclassified from accumulated comprehensive income to accumulated deficit | 0 | |||||||
Proceeds from recovery of charged off loans | 9,900,000 | 21,500,000 | 24,800,000 | |||||
Elastic Reporting Unit | ||||||||
Class of Stock [Line Items] | ||||||||
Impairment of goodwill | $ 0 | |||||||
Discontinued Operations, Disposed of by Means Other than Sale | Elevate Credit International Limited | ||||||||
Class of Stock [Line Items] | ||||||||
Impairment loss from discontinued operations | 9,251,000 | 0 | 0 | |||||
Revision of Prior Period, Adjustment | ||||||||
Class of Stock [Line Items] | ||||||||
Income taxes payable | 605,000 | |||||||
Accounts payable and accrued liabilities | 605,000 | |||||||
Accounting Standards Update 2016-02 | ||||||||
Class of Stock [Line Items] | ||||||||
Right of use assets | $ 11,500,000 | |||||||
Operating lease liabilities | 15,400,000 | |||||||
Accounting Standards Update 2016-02 | Continuing Operations | ||||||||
Class of Stock [Line Items] | ||||||||
Right of use assets | 10,300,000 | |||||||
Operating lease liabilities | $ 14,200,000 | |||||||
Accounting Standards Update 2018-15 | ||||||||
Class of Stock [Line Items] | ||||||||
Capitalized implementation costs associated with cloud computing arrangements | 1,000,000 | 1,000,000 | ||||||
Interest Expense | Interest Rate Cap | ||||||||
Class of Stock [Line Items] | ||||||||
Gain related to the maturation of the interest rate caps | 303,000 | 2,417,000 | ||||||
Indirect guarantee of indebtedness | ||||||||
Class of Stock [Line Items] | ||||||||
Estimated losses | 700,000 | 700,000 | 2,100,000 | |||||
Loans receivable guaranteed | $ 2,200,000 | $ 2,200,000 | $ 19,600,000 | |||||
Installment Loans and Lines of Credit | ||||||||
Class of Stock [Line Items] | ||||||||
Threshold period past due for write-off | 60 days | 60 days | ||||||
Minimum period past due for nonaccrual of finance charges and other fees | 60 days | |||||||
Period past due for loans to be classified as troubled debt restructuring (greater than) | 60 days | |||||||
Loan modifications not recognized as troubled debt restructuring, deferral period | 6 months | |||||||
Loans, grace period before past due | 16 days | |||||||
Today | ||||||||
Class of Stock [Line Items] | ||||||||
Threshold period past due for write-off | 120 days | 120 days | ||||||
Minimum period past due for nonaccrual of finance charges and other fees | 90 days | |||||||
Period past dues for nonaccrual | 120 days | |||||||
Loans, grace period before past due | 25 days | |||||||
Rise Product, Lines of Credit | ||||||||
Class of Stock [Line Items] | ||||||||
Number of states, rise product, lines of credit offered | state | 2 | 2 | ||||||
Minimum | ||||||||
Class of Stock [Line Items] | ||||||||
Loans, initial deferral period | 30 days | 30 days | ||||||
Cash reserve required, percentage of outstanding loan principal | 25.00% | |||||||
Fair value inputs, financial performance measurement term | 6 years | |||||||
Maximum | ||||||||
Class of Stock [Line Items] | ||||||||
Loans, initial deferral period | 60 days | 60 days | ||||||
Loans, deferral period | 180 days | 180 days | ||||||
Cash reserve required, percentage of outstanding loan principal | 45.00% | |||||||
Fair value inputs, financial performance measurement term | 9 years | |||||||
Accumulated other comprehensive income | ||||||||
Class of Stock [Line Items] | ||||||||
Certain stranded tax effects reclassified from accumulated comprehensive income to accumulated deficit | 920,000 | |||||||
Accumulated deficit | ||||||||
Class of Stock [Line Items] | ||||||||
Certain stranded tax effects reclassified from accumulated comprehensive income to accumulated deficit | $ (920,000) | |||||||
[1] | These balances include certain assets and liabilities of variable interest entities (“VIEs”) that can only be used to settle the liabilities of that respective VIE. All assets of the Company are pledged as security for the Company’s outstanding debt, including debt held by the VIEs. For further information regarding the assets and liabilities included in the Company's consolidated accounts, see Note 4— Variable Interest Entities. |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Credit Service Organization (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Loss Contingencies [Line Items] | ||
Receivable related to 25%-45% cash reserve | $ 1,333 | $ 8,648 |
Receivable (payable) related to CSO fees collected by CSO lenders | (78) | (9) |
Receivable related to licensing and servicing arrangements with CSO lenders | 0 | 57 |
Total receivable from CSO lenders | $ 1,255 | $ 8,696 |
Minimum | ||
Loss Contingencies [Line Items] | ||
Cash reserve required, percentage of outstanding loan principal | 25.00% | |
Maximum | ||
Loss Contingencies [Line Items] | ||
Cash reserve required, percentage of outstanding loan principal | 45.00% |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Property and Equipment (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, capitalization threshold | $ 500 | |
Capitalized Computer Software, Net [Abstract] | ||
Software development costs | 79,200,000 | $ 64,196,000 |
Less: accumulated amortization | (53,265,000) | (39,036,000) |
Net book value | 25,935,000 | 25,160,000 |
Amortization expense | $ 14,229,000 | $ 9,961,000 |
Furniture and fixtures | ||
Capitalized Computer Software, Net [Abstract] | ||
Estimated useful life | 7 years | |
Equipment | Minimum | ||
Capitalized Computer Software, Net [Abstract] | ||
Estimated useful life | 3 years | |
Equipment | Maximum | ||
Capitalized Computer Software, Net [Abstract] | ||
Estimated useful life | 5 years | |
Leasehold improvements | Minimum | ||
Capitalized Computer Software, Net [Abstract] | ||
Estimated useful life | 3 years | |
Leasehold improvements | Maximum | ||
Capitalized Computer Software, Net [Abstract] | ||
Estimated useful life | 5 years | |
Software and software development | ||
Capitalized Computer Software, Net [Abstract] | ||
Estimated useful life | 3 years |
Earnings Per Share - Computatio
Earnings Per Share - Computation of Earnings (Loss) Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Numerator (basic and diluted): | |||||||||||
Net income from continuing operations | $ (4,429) | $ 16,616 | $ 16,093 | $ 7,922 | $ 4,210 | $ 2,648 | $ 8,383 | $ 10,955 | $ 36,202 | $ 26,196 | $ 13,750 |
Net income (loss) from discontinued operations | 298 | 4,465 | (7,540) | (12,833) | 4,079 | 2,116 | (2,611) | 2,403 | (15,610) | 5,987 | (1,241) |
Net income (loss) | $ (4,131) | $ 21,081 | $ 8,553 | $ (4,911) | $ 8,289 | $ 4,764 | $ 5,772 | $ 13,358 | $ 20,592 | $ 32,183 | $ 12,509 |
Denominator (basic): | |||||||||||
Basic weighted-average number of shares outstanding (in shares) | 38,851,781 | 40,230,256 | 42,182,412 | 43,161,716 | 44,009,459 | 44,169,964 | 43,681,159 | 43,348,249 | 40,926,581 | 43,805,845 | 42,791,061 |
Denominator (diluted): | |||||||||||
Basic weighted-average number of shares outstanding (in shares) | 38,851,781 | 40,230,256 | 42,182,412 | 43,161,716 | 44,009,459 | 44,169,964 | 43,681,159 | 43,348,249 | 40,926,581 | 43,805,845 | 42,791,061 |
Effect of potentially dilutive securities: | |||||||||||
Employee stock plans (options and RSUs) (in shares) | 835,042 | 532,360 | 1,508,243 | ||||||||
Diluted weighted-average number of shares outstanding (in shares) | 38,851,781 | 40,762,330 | 42,511,808 | 43,161,716 | 44,587,331 | 44,743,944 | 44,291,816 | 43,875,410 | 41,761,623 | 44,338,205 | 44,299,304 |
Basic and diluted earnings per share: | |||||||||||
Continuing operations (in usd per share) | $ (0.11) | $ 0.41 | $ 0.38 | $ 0.18 | $ 0.10 | $ 0.06 | $ 0.19 | $ 0.25 | $ 0.88 | $ 0.60 | $ 0.32 |
Discontinued operations (in usd per share) | 0.01 | 0.11 | (0.18) | (0.29) | 0.09 | 0.05 | (0.06) | 0.06 | (0.38) | 0.13 | (0.03) |
Basic earnings (loss) per share (in usd per share) | (0.10) | 0.52 | 0.20 | (0.11) | 0.19 | 0.11 | 0.13 | 0.31 | 0.50 | 0.73 | 0.29 |
Continuing operations (in usd per share) | (0.11) | 0.41 | 0.38 | 0.18 | 0.09 | 0.06 | 0.19 | 0.25 | 0.87 | 0.59 | 0.31 |
Discontinued operations (in usd per share) | 0.01 | 0.11 | (0.18) | (0.29) | 0.10 | 0.05 | (0.06) | 0.05 | (0.38) | 0.14 | (0.03) |
Diluted earnings (loss) per share (in usd per share) | $ (0.10) | $ 0.52 | $ 0.20 | $ (0.11) | $ 0.19 | $ 0.11 | $ 0.13 | $ 0.30 | $ 0.49 | $ 0.73 | $ 0.28 |
Earnings Per Share - Narrative
Earnings Per Share - Narrative (Details) - shares | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Stock options | |||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||
Antidilutive shares (in shares) | 1,360,711 | 1,434,882 | 249,517 |
RSUs | |||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||
Antidilutive shares (in shares) | 2,483,622 | 3,552,730 | 826,557 |
Loans Receivable and Revenues -
Loans Receivable and Revenues - Revenue from Consumer Loans (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||||||
Total revenues | $ 90,724 | $ 94,164 | $ 117,991 | $ 162,467 | $ 164,137 | $ 164,296 | $ 150,374 | $ 160,066 | $ 465,346 | $ 638,873 | $ 663,716 |
Other | |||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||||||
Total revenues | 1,263 | 2,103 | 3,931 | ||||||||
Finance charges | |||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||||||
Revenues | 274,025 | 348,537 | 345,003 | ||||||||
Elastic | |||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||||||
Revenues | 173,528 | 247,398 | 254,561 | ||||||||
CSO fees | |||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||||||
Revenues | $ 16,530 | $ 40,835 | $ 60,221 |
Loans Receivable and Revenues_2
Loans Receivable and Revenues - Schedule of Receivables (Details) $ in Thousands | 10 Months Ended | 12 Months Ended | |||
Dec. 31, 2020USD ($)state | Dec. 31, 2020USD ($)state | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | ||
Financing Receivable, Past Due [Line Items] | |||||
Loans, grace period before past due | 16 days | ||||
Loans, deferral period, additional extension period | 30 days | ||||
Loans, deferral period, additional extension period | 30 days | ||||
Percentage of customers provided relief through payment deferral program | 8.70% | ||||
Loans on deferred payment | $ 34,600 | $ 34,600 | |||
Loans receivable in non-accrual status | 19,200 | 19,200 | $ 6,100 | ||
Interest receivable | 25,300 | 25,300 | 33,000 | ||
Current loans | 390,841 | 390,841 | 550,788 | ||
Past due loans | 30,873 | 30,873 | 68,779 | ||
Total loans receivable | 421,714 | 421,714 | 619,567 | ||
Net unamortized loan premium | 1,517 | 1,517 | 2,418 | ||
Less: Allowance for loan losses | (48,399) | (48,399) | (79,912) | $ (82,203) | |
Loans receivable, net | [1] | $ 374,832 | $ 374,832 | 542,073 | |
Minimum | |||||
Financing Receivable, Past Due [Line Items] | |||||
Loans, initial deferral period | 30 days | 30 days | |||
Maximum | |||||
Financing Receivable, Past Due [Line Items] | |||||
Loans, initial deferral period | 60 days | 60 days | |||
Loans, deferral period | 180 days | 180 days | |||
Rise | |||||
Financing Receivable, Past Due [Line Items] | |||||
Current loans | $ 222,937 | $ 222,937 | 307,408 | ||
Past due loans | 22,383 | 22,383 | 46,386 | ||
Total loans receivable | 245,320 | 245,320 | 353,794 | ||
Net unamortized loan premium | 239 | 239 | 290 | ||
Less: Allowance for loan losses | (33,288) | (33,288) | (50,019) | ||
Loans receivable, net | 212,271 | 212,271 | 304,065 | ||
Elastic | |||||
Financing Receivable, Past Due [Line Items] | |||||
Current loans | 154,950 | 154,950 | 239,941 | ||
Past due loans | 6,926 | 6,926 | 21,285 | ||
Total loans receivable | 161,876 | 161,876 | 261,226 | ||
Net unamortized loan premium | 1,278 | 1,278 | 2,128 | ||
Less: Allowance for loan losses | (13,201) | (13,201) | (28,852) | (36,019) | |
Loans receivable, net | 149,953 | $ 149,953 | 234,502 | ||
Today | |||||
Financing Receivable, Past Due [Line Items] | |||||
Loans, grace period before past due | 25 days | ||||
Current loans | 12,954 | $ 12,954 | 3,439 | ||
Past due loans | 1,564 | 1,564 | 1,108 | ||
Total loans receivable | 14,518 | 14,518 | 4,547 | ||
Net unamortized loan premium | 0 | 0 | 0 | ||
Less: Allowance for loan losses | (1,910) | (1,910) | (1,041) | $ (31) | |
Loans receivable, net | $ 12,608 | $ 12,608 | $ 3,506 | ||
Rise Product, Lines of Credit | |||||
Financing Receivable, Past Due [Line Items] | |||||
Number of states, rise product, lines of credit offered | state | 2 | 2 | |||
[1] | These balances include certain assets and liabilities of variable interest entities (“VIEs”) that can only be used to settle the liabilities of that respective VIE. All assets of the Company are pledged as security for the Company’s outstanding debt, including debt held by the VIEs. For further information regarding the assets and liabilities included in the Company's consolidated accounts, see Note 4— Variable Interest Entities. |
Loans Receivable and Revenues_3
Loans Receivable and Revenues - Changes in Allowance for Loan Losses (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Balance beginning of year | $ 81,992 | $ 86,647 | $ 84,736 | |
Provision for loan losses | 156,910 | 325,662 | 362,198 | |
Charge-offs | (209,946) | (361,711) | (393,486) | |
Recoveries of prior charge-offs | 20,123 | 31,394 | 33,199 | |
Total | 49,079 | 81,992 | 86,647 | |
Accrual for CSO lender owned loans | (680) | (2,080) | (4,444) | |
Loans receivable, allowance for credit loss | 48,399 | 79,912 | 82,203 | |
Loans receivable, net of allowance for loan losses | [1] | 374,832 | 542,073 | |
Rise | ||||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Balance beginning of year | 52,099 | 50,597 | 55,867 | |
Provision for loan losses | 108,105 | 207,079 | 223,298 | |
Charge-offs | (140,616) | (226,227) | (250,623) | |
Recoveries of prior charge-offs | 14,380 | 20,650 | 22,055 | |
Total | 33,968 | 52,099 | 50,597 | |
Accrual for CSO lender owned loans | (680) | (2,080) | (4,444) | |
Loans receivable, allowance for credit loss | 33,288 | 50,019 | 46,153 | |
Elastic | ||||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Balance beginning of year | 28,852 | 36,019 | 28,869 | |
Provision for loan losses | 45,988 | 116,462 | 138,869 | |
Charge-offs | (67,300) | (134,362) | (142,863) | |
Recoveries of prior charge-offs | 5,661 | 10,733 | 11,144 | |
Total | 13,201 | 28,852 | 36,019 | |
Accrual for CSO lender owned loans | 0 | 0 | 0 | |
Loans receivable, allowance for credit loss | 13,201 | 28,852 | 36,019 | |
Loans receivable, net of allowance for loan losses | 149,953 | 234,502 | ||
Today | ||||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Balance beginning of year | 1,041 | 31 | 0 | |
Provision for loan losses | 2,817 | 2,121 | 31 | |
Charge-offs | (2,030) | (1,122) | 0 | |
Recoveries of prior charge-offs | 82 | 11 | 0 | |
Total | 1,910 | 1,041 | 31 | |
Accrual for CSO lender owned loans | 0 | 0 | 0 | |
Loans receivable, allowance for credit loss | 1,910 | 1,041 | $ 31 | |
Loans receivable, net of allowance for loan losses | 12,608 | 3,506 | ||
CSO fees | ||||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Loans receivable, allowance for credit loss | 700 | 2,100 | ||
Loans receivable, net of allowance for loan losses | $ 2,200 | $ 19,600 | ||
[1] | These balances include certain assets and liabilities of variable interest entities (“VIEs”) that can only be used to settle the liabilities of that respective VIE. All assets of the Company are pledged as security for the Company’s outstanding debt, including debt held by the VIEs. For further information regarding the assets and liabilities included in the Company's consolidated accounts, see Note 4— Variable Interest Entities. |
Loans Receivable and Revenues_4
Loans Receivable and Revenues - Troubled Debt Restructurings (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Financing Receivable, Troubled Debt Restructuring [Line Items] | |||
Threshold period past due for write-off | 60 days | ||
Outstanding recorded investment before TDR | $ 30,378 | $ 32,040 | $ 26,683 |
Outstanding recorded investment after TDR | 29,492 | 29,689 | 24,421 |
Total principal and interest forgiveness included in charge-offs within the allowance for loan loss | 886 | 2,351 | 2,262 |
Average outstanding recorded investment | 21,828 | 15,010 | 9,132 |
Interest income recognized | 12,560 | 11,013 | $ 14,056 |
Recorded investment | 26,793 | 16,862 | |
Less: Impairment included in Allowance for loan losses | (7,133) | (3,664) | |
Outstanding recorded investment, net of impairment | 19,660 | 13,198 | |
Troubled debt restructurings, subsequently defaulted | 14,300 | 15,600 | |
Troubled debt restructurings, commitments to lend funds | 4,600 | ||
Current outstanding investment | |||
Financing Receivable, Troubled Debt Restructuring [Line Items] | |||
Recorded investment | 21,261 | 11,313 | |
Delinquent outstanding investment | |||
Financing Receivable, Troubled Debt Restructuring [Line Items] | |||
Recorded investment | $ 5,532 | $ 5,549 | |
Installment Loans and Lines of Credit | |||
Financing Receivable, Troubled Debt Restructuring [Line Items] | |||
Threshold period past due for write-off | 60 days |
Variable Interest Entities - Na
Variable Interest Entities - Narrative (Details) - entity | Aug. 01, 2019 | Jul. 31, 2019 | Jul. 31, 2020 | Dec. 31, 2020 |
Variable Interest Entity [Line Items] | ||||
Variable interest entity, number of entities | 6 | |||
Third Party Lender | ||||
Variable Interest Entity [Line Items] | ||||
Loan purchase interest percentage | 5.00% | |||
Variable Interest Entity, Primary Beneficiary | Third Party Lender | ||||
Variable Interest Entity [Line Items] | ||||
Loan purchase interest percentage | 5.00% | |||
Variable Interest Entity, Primary Beneficiary | Elastic SPV, Ltd. | ||||
Variable Interest Entity [Line Items] | ||||
Loan purchase interest percentage | 90.00% | |||
Variable Interest Entity, Primary Beneficiary | EF SPV, Ltd. | ||||
Variable Interest Entity [Line Items] | ||||
Loan purchase interest percentage | 95.00% | 96.00% | ||
Loan purchase right purchased percentage | 1.00% | |||
Variable Interest Entity, Primary Beneficiary | EC SPV, Ltd. | ||||
Variable Interest Entity [Line Items] | ||||
Loan purchase interest percentage | 95.00% | |||
Credit Services Organization Lenders | ||||
Variable Interest Entity [Line Items] | ||||
Variable interest entity, number of entities | 3 |
Variable Interest Entities - Su
Variable Interest Entities - Summary of Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |||
ASSETS | |||||||
Cash and cash equivalents | $ 197,983 | [1] | $ 71,215 | [1] | $ 48,348 | $ 31,582 | |
Restricted cash | 3,135 | 2,235 | 2,535 | $ 1,535 | |||
Loans receivable, net of allowance for loan losses | [1] | 374,832 | 542,073 | ||||
Loans receivable, allowance for credit loss | 48,399 | 79,912 | $ 82,203 | ||||
Receivable from payment processors | [1] | 6,147 | 8,681 | ||||
Total assets | 669,599 | 783,587 | |||||
LIABILITIES AND SHAREHOLDER'S EQUITY | |||||||
Accounts payable and accrued liabilities | [1] | 52,252 | 38,679 | ||||
Deferred revenue | [1] | 3,134 | 12,087 | ||||
Notes payable, net | [1] | 438,403 | 525,439 | ||||
Total liabilities and stockholders’ equity | 669,599 | 783,587 | |||||
Variable Interest Entity, Primary Beneficiary | Elastic SPV, Ltd. | |||||||
ASSETS | |||||||
Cash and cash equivalents | 97,345 | 26,245 | |||||
Loans receivable, net of allowance for loan losses | 149,951 | 234,504 | |||||
Loans receivable, allowance for credit loss | 13,202 | 28,852 | |||||
Receivable from payment processors | 3,652 | 6,363 | |||||
Total assets | 250,948 | 267,112 | |||||
LIABILITIES AND SHAREHOLDER'S EQUITY | |||||||
Accounts payable and accrued liabilities | 27,663 | 15,902 | |||||
Deferred revenue | 2,300 | 4,280 | |||||
Reserve deposit liability | 23,150 | 23,150 | |||||
Notes payable, net | 197,835 | 223,780 | |||||
Total liabilities and stockholders’ equity | 250,948 | 267,112 | |||||
Variable Interest Entity, Primary Beneficiary | EF SPV, Ltd. | |||||||
ASSETS | |||||||
Cash and cash equivalents | 35,450 | 7,541 | |||||
Loans receivable, net of allowance for loan losses | 83,869 | 111,281 | |||||
Loans receivable, allowance for credit loss | 14,342 | 17,436 | |||||
Receivable from payment processors | 713 | 681 | |||||
Total assets | 120,032 | 119,503 | |||||
LIABILITIES AND SHAREHOLDER'S EQUITY | |||||||
Accounts payable and accrued liabilities | 17,599 | 8,576 | |||||
Reserve deposit liability | 8,950 | 8,950 | |||||
Notes payable, net | 93,483 | 101,977 | |||||
Total liabilities and stockholders’ equity | 120,032 | 119,503 | |||||
Variable Interest Entity, Primary Beneficiary | EC SPV, Ltd. | |||||||
ASSETS | |||||||
Cash and cash equivalents | 9,377 | ||||||
Restricted cash | 1,000 | ||||||
Loans receivable, net of allowance for loan losses | 19,231 | ||||||
Loans receivable, allowance for credit loss | 1,634 | ||||||
Receivable from payment processors | 211 | ||||||
Total assets | 29,819 | ||||||
LIABILITIES AND SHAREHOLDER'S EQUITY | |||||||
Accounts payable and accrued liabilities | 1,541 | ||||||
Reserve deposit liability | 3,500 | ||||||
Notes payable, net | 24,778 | ||||||
Total liabilities and stockholders’ equity | 29,819 | ||||||
Variable Interest Entity, Primary Beneficiary | Consolidation, Eliminations | Elastic SPV, Ltd. | |||||||
LIABILITIES AND SHAREHOLDER'S EQUITY | |||||||
Accounts payable and accrued liabilities | 23,337 | 7,690 | |||||
Reserve deposit liability | 23,150 | 23,150 | |||||
Variable Interest Entity, Primary Beneficiary | Consolidation, Eliminations | EF SPV, Ltd. | |||||||
ASSETS | |||||||
Receivable from payment processors | 231 | 0 | |||||
LIABILITIES AND SHAREHOLDER'S EQUITY | |||||||
Accounts payable and accrued liabilities | 16,459 | 7,114 | |||||
Reserve deposit liability | 8,950 | $ 8,950 | |||||
Variable Interest Entity, Primary Beneficiary | Consolidation, Eliminations | EC SPV, Ltd. | |||||||
ASSETS | |||||||
Receivable from payment processors | 6 | ||||||
LIABILITIES AND SHAREHOLDER'S EQUITY | |||||||
Accounts payable and accrued liabilities | 803 | ||||||
Reserve deposit liability | $ 3,500 | ||||||
[1] | These balances include certain assets and liabilities of variable interest entities (“VIEs”) that can only be used to settle the liabilities of that respective VIE. All assets of the Company are pledged as security for the Company’s outstanding debt, including debt held by the VIEs. For further information regarding the assets and liabilities included in the Company's consolidated accounts, see Note 4— Variable Interest Entities. |
Property and Equipment - Compon
Property and Equipment - Components of Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 116,748 | $ 100,766 |
Less accumulated depreciation | (82,748) | (64,822) |
Property and equipment, net | 34,000 | 35,944 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 4,288 | 4,315 |
Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 15,323 | 14,453 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 8,310 | 8,301 |
Software development cost | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 79,200 | 64,196 |
Software-purchased | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 9,627 | $ 9,501 |
Property and Equipment - Narrat
Property and Equipment - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation expense | $ 18,000 | $ 16,000 | $ 11,000 |
Impairment expense recognized | $ 681 | $ 311 |
Accounts Payable and Accrued _3
Accounts Payable and Accrued Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Payables and Accruals [Abstract] | ||||
Accounts payable | $ 7,568 | $ 10,604 | ||
Accrued compensation | 15,326 | 15,644 | ||
Accrual for CSO lender owned loans | 680 | 2,080 | $ 4,444 | |
Interest payable | 3,852 | 4,691 | ||
Other accrued liabilities | 24,826 | 5,660 | ||
Accounts payable and accrued liabilities | [1] | $ 52,252 | $ 38,679 | |
[1] | These balances include certain assets and liabilities of variable interest entities (“VIEs”) that can only be used to settle the liabilities of that respective VIE. All assets of the Company are pledged as security for the Company’s outstanding debt, including debt held by the VIEs. For further information regarding the assets and liabilities included in the Company's consolidated accounts, see Note 4— Variable Interest Entities. |
Notes Payable, Net - Narrative
Notes Payable, Net - Narrative (Details) | 12 Months Ended |
Dec. 31, 2020debt_facility | |
VPC | |
Debt Instrument [Line Items] | |
Number of debt facilities | 4 |
Notes Payable, Net - VPC Facili
Notes Payable, Net - VPC Facility (Details) - Line of Credit - USD ($) | Feb. 01, 2019 | Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2020 |
US Term Note | Term Notes | ||||||
Debt Instrument [Line Items] | ||||||
Maximum borrowing amount | $ 200,000,000 | |||||
Blended interest rate | 10.23% | 9.98% | 10.23% | |||
Option to pay down amount outstanding, percentage (up to) | 20.00% | |||||
US Term Note | Term Notes | 3-month London Interbank Offered Rate (LIBOR) | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable interest rate, floor | 1.00% | 1.00% | ||||
Basis spread on variable interest rate | 11.00% | 11.00% | ||||
US Term Note | Term Notes | Base Rate | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable interest rate | 2.73% | |||||
US Term Note | Term Notes | Base Rate | Weighted Average | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable interest rate | 2.73% | 2.73% | ||||
US Term Note | Term Notes | Greater Of 3-month London Interbank Offered Rate (LIBOR) Or Five-Year LIBOR Swap Rate | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable interest rate, floor | 1.00% | |||||
Basis spread on variable interest rate | 7.50% | 7.25% | 7.50% | |||
4th Tranche Term Note | Term Notes | ||||||
Debt Instrument [Line Items] | ||||||
Maximum borrowing amount | $ 18,000,000 | |||||
Blended interest rate | 15.73% | |||||
4th Tranche Term Note | Term Notes | 3-month London Interbank Offered Rate (LIBOR) | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable interest rate, floor | 1.00% | |||||
Basis spread on variable interest rate | 13.00% | 13.00% | ||||
4th Tranche Term Note | Term Notes | Base Rate | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable interest rate | 2.73% | |||||
VPC Facility | ||||||
Debt Instrument [Line Items] | ||||||
Maximum borrowing amount | $ 218,000,000 | |||||
UK Term Note | Discontinued Operations, Disposed of by Means Other than Sale | Elevate Credit International Limited | ||||||
Debt Instrument [Line Items] | ||||||
Fair value of guarantee obligation | $ 566,000 |
Notes Payable, Net - ESPV Facil
Notes Payable, Net - ESPV Facility (Details) - Line of Credit - ESPV Term Note - USD ($) | Jul. 01, 2019 | Feb. 01, 2019 | Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Debt Instrument [Line Items] | ||||||
Maximum borrowing capacity | $ 350,000,000 | |||||
Blended interest rate | 10.23% | 15.48% | 9.97% | 10.22% | ||
Option to pay down amount outstanding, percentage (up to) | 20.00% | |||||
3-month London Interbank Offered Rate (LIBOR) | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable interest rate, floor | 1.00% | |||||
3-month London Interbank Offered Rate (LIBOR) | Outstanding balance up to $50 Million | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable interest rate | 13.00% | |||||
3-month London Interbank Offered Rate (LIBOR) | Outstanding balance greater than $50 Million | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable interest rate | 12.00% | |||||
3-month London Interbank Offered Rate (LIBOR) | Outstanding balance in excess of $100 Million | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable interest rate | 13.50% | |||||
3-month London Interbank Offered Rate (LIBOR) | Outstanding amounts greater than $150 Million | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable interest rate | 12.75% | |||||
Base Rate | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable interest rate | 2.73% | 2.73% | ||||
Greater Of 3-month London Interbank Offered Rate (LIBOR) Or Five-Year LIBOR Swap Rate | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable interest rate, floor | 1.00% | |||||
Basis spread on variable interest rate | 7.50% | 12.75% | 7.25% | 7.50% | ||
Maximum | Outstanding balance up to $50 Million | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit outstanding | $ 50,000,000 | |||||
Maximum | Outstanding balance greater than $50 Million | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit outstanding | 100,000,000 | |||||
Maximum | Outstanding balance in excess of $100 Million | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit outstanding | 150,000,000 | |||||
Minimum | Outstanding balance greater than $50 Million | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit outstanding | 50,000,000 | |||||
Minimum | Outstanding balance in excess of $100 Million | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit outstanding | 100,000,000 | |||||
Minimum | Outstanding amounts greater than $150 Million | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit outstanding | $ 150,000,000 | |||||
Weighted Average | Base Rate | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable interest rate | 2.72% | 2.72% |
Notes Payable, Net - EF SPV Fac
Notes Payable, Net - EF SPV Facility (Details) - Line of Credit - USD ($) | Feb. 01, 2019 | Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
EF SPV Facility | |||||
Debt Instrument [Line Items] | |||||
Maximum borrowing amount | $ 250,000,000 | ||||
Line of credit facility, amount outstanding, re-allocated | $ 43,000,000 | ||||
Interest rate | 10.23% | ||||
Weighted average interest rate | 9.70% | 9.99% | |||
Option to pay down amount outstanding, percentage (up to) | 20.00% | ||||
EF SPV Facility | Base Rate | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable interest rate | 2.73% | ||||
EF SPV Facility | Base Rate | Weighted Average | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable interest rate | 2.49% | 2.45% | |||
EF SPV Facility | Greater Of 3-month London Interbank Offered Rate (LIBOR) Or Five-Year LIBOR Swap Rate | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable interest rate, floor | 1.00% | ||||
Basis spread on variable interest rate | 7.50% | 7.25% | 7.50% | ||
Notes Payable to Banks | US Term Note | |||||
Debt Instrument [Line Items] | |||||
Maximum borrowing amount | $ 200,000,000 | ||||
Weighted average interest rate | 10.23% | 9.98% | 10.23% | ||
Option to pay down amount outstanding, percentage (up to) | 20.00% | ||||
Notes Payable to Banks | US Term Note | 3-month London Interbank Offered Rate (LIBOR) | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable interest rate, floor | 1.00% | 1.00% | |||
Basis spread on variable interest rate | 11.00% | 11.00% | |||
Notes Payable to Banks | US Term Note | Base Rate | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable interest rate | 2.73% | ||||
Notes Payable to Banks | US Term Note | Base Rate | Weighted Average | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable interest rate | 2.73% | 2.73% | |||
Notes Payable to Banks | US Term Note | Greater Of 3-month London Interbank Offered Rate (LIBOR) Or Five-Year LIBOR Swap Rate | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable interest rate, floor | 1.00% | ||||
Basis spread on variable interest rate | 7.50% | 7.25% | 7.50% |
Notes Payable, Net - EC SPV Fac
Notes Payable, Net - EC SPV Facility (Details) - EC SPV Facility - Line of Credit - USD ($) | Jul. 31, 2020 | Dec. 31, 2020 |
Line of Credit Facility [Line Items] | ||
Weighted average interest rate | 9.98% | |
Base Rate | ||
Line of Credit Facility [Line Items] | ||
Basis spread on variable interest rate | 7.25% | |
Base Rate | Weighted Average | ||
Line of Credit Facility [Line Items] | ||
Basis spread on variable interest rate | 2.73% | |
Revolving Credit Facility | ||
Line of Credit Facility [Line Items] | ||
Maximum borrowing amount | $ 100,000,000 | |
Basis spread on variable interest rate, floor | 1.00% | |
Revolving Credit Facility | Base Rate | ||
Line of Credit Facility [Line Items] | ||
Basis spread on variable interest rate | 7.25% |
Notes Payable, Net - VPC, ESPV
Notes Payable, Net - VPC, ESPV SPV, EF SPV and EC SPV Facilities (Details) - USD ($) $ in Thousands | Jul. 31, 2020 | Jul. 01, 2019 | Feb. 01, 2019 | Dec. 31, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2019 | |
Debt Instrument [Line Items] | ||||||||||||
Long-term debt | $ 440,550 | $ 440,550 | ||||||||||
Debt discount and issuance costs | (2,147) | (2,147) | $ (2,611) | |||||||||
Notes payable, net | [1] | 438,403 | 438,403 | 525,439 | ||||||||
Repayments of long-term debt | 119,000 | 60,000 | $ 0 | |||||||||
Proceeds from Issuance of long-term debt | 31,500 | 64,000 | $ 41,000 | |||||||||
Line of Credit | US Term Note | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Long-term debt | 104,500 | $ 104,500 | $ 182,000 | |||||||||
Repayments of long-term debt | 25,000 | $ 25,000 | $ 27,500 | |||||||||
Line of Credit | US Term Note | Greater Of 3-month London Interbank Offered Rate (LIBOR) Or Five-Year LIBOR Swap Rate | Term Notes | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable interest rate | 7.50% | 7.25% | 7.50% | |||||||||
Line of Credit | US Term Note | 3-month London Interbank Offered Rate (LIBOR) | Term Notes | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable interest rate | 11.00% | 11.00% | ||||||||||
Line of Credit | US Term Note | Base Rate | Term Notes | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable interest rate | 2.73% | |||||||||||
Line of Credit | 4th Tranche Term Note | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Long-term debt | 18,050 | $ 18,050 | $ 18,050 | |||||||||
Debt instrument, debt prepayment cost | $ 850 | |||||||||||
Line of Credit | 4th Tranche Term Note | 3-month London Interbank Offered Rate (LIBOR) | Term Notes | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable interest rate | 13.00% | 13.00% | ||||||||||
Line of Credit | 4th Tranche Term Note | Base Rate | Term Notes | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable interest rate | 2.73% | |||||||||||
Line of Credit | ESPV Term Note | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Long-term debt | 199,500 | $ 199,500 | $ 226,000 | |||||||||
Repayments of long-term debt | 20,000 | 6,500 | ||||||||||
Debt instrument, fee amount | $ 2,400 | |||||||||||
Line of Credit | ESPV Term Note | Greater Of 3-month London Interbank Offered Rate (LIBOR) Or Five-Year LIBOR Swap Rate | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable interest rate | 7.50% | 12.75% | 7.25% | 7.50% | ||||||||
Line of Credit | ESPV Term Note | Base Rate | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable interest rate | 2.73% | 2.73% | ||||||||||
Line of Credit | EF SPV Term Note | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Long-term debt | 93,500 | $ 93,500 | $ 102,000 | |||||||||
Repayments of long-term debt | $ 15,000 | |||||||||||
Proceeds from Issuance of long-term debt | $ 6,500 | |||||||||||
Line of Credit | EF SPV Term Note | Greater Of 3-month London Interbank Offered Rate (LIBOR) Or Five-Year LIBOR Swap Rate | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable interest rate | 7.50% | 7.25% | 7.50% | |||||||||
Line of Credit | EF SPV Term Note | Base Rate | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable interest rate | 2.73% | |||||||||||
Line of Credit | EC SPV Term Note | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Long-term debt | 25,000 | $ 25,000 | $ 0 | |||||||||
Proceeds from Issuance of long-term debt | $ 25,000 | |||||||||||
Line of Credit | EC SPV Term Note | Base Rate | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable interest rate | 7.25% | |||||||||||
Line of Credit | EC SPV Term Note | Base Rate | Revolving Credit Facility | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Basis spread on variable interest rate | 7.25% | |||||||||||
Line of Credit | US Term Note, EF SPV Facility And ESPV Term Note | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Reduction on basis spread of variable rate | 0.25% | |||||||||||
[1] | These balances include certain assets and liabilities of variable interest entities (“VIEs”) that can only be used to settle the liabilities of that respective VIE. All assets of the Company are pledged as security for the Company’s outstanding debt, including debt held by the VIEs. For further information regarding the assets and liabilities included in the Company's consolidated accounts, see Note 4— Variable Interest Entities. |
Notes Payable, Net - Future Deb
Notes Payable, Net - Future Debt Maturities (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Maturities of Long-term Debt [Abstract] | |
2021 | $ 18,050 |
2022 | 0 |
2023 | 0 |
2024 | 422,500 |
2025 | 0 |
Thereafter | 0 |
Total | $ 440,550 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Narrative (Details) - USD ($) | 1 Months Ended | 6 Months Ended | 12 Months Ended | ||
May 31, 2018 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Finite-Lived Intangible Assets [Line Items] | |||||
Impairment of goodwill | $ 0 | ||||
Goodwill | $ 6,776,000 | $ 6,776,000 | |||
Goodwill deductible for tax purposes | 270,000 | 270,000 | |||
Noncompete agreement term | 1 year | ||||
Amortization expense | $ 120,000 | $ 310,000 | $ 411,000 | ||
Weighted average remaining amortization period for the intangible assets | 5 years | 6 years | 6 years | ||
Valuation, Income Approach | Minimum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Goodwill, fair value, period | 6 years | ||||
Valuation, Income Approach | Maximum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Goodwill, fair value, period | 9 years | ||||
Discontinued Operations, Disposed of by Means Other than Sale | Elevate Credit International Limited | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Impairment loss from discontinued operations | $ 9,251,000 | $ 0 | $ 0 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, accumulated amortization | $ (2,196) | $ (2,076) |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||
Intangible assets, cost | 3,329 | 3,329 |
Intangible assets, net | 1,133 | 1,253 |
Domain names | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | 531 | 531 |
Acquired technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, cost | 211 | 211 |
Finite-lived intangible assets, accumulated amortization | (211) | (211) |
Finite-lived intangible assets, net | 0 | 0 |
Non-compete | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, cost | 2,461 | 2,461 |
Finite-lived intangible assets, accumulated amortization | (1,859) | (1,739) |
Finite-lived intangible assets, net | 602 | 722 |
Customers | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, cost | 126 | 126 |
Finite-lived intangible assets, accumulated amortization | (126) | (126) |
Finite-lived intangible assets, net | $ 0 | $ 0 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Future Amortization Expense (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2021 | $ 120 |
2022 | 120 |
2023 | 120 |
2024 | 120 |
2025 | $ 120 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Lessee, Lease, Description [Line Items] | |||
Term of option to extend | 10 years | ||
Right of use assets | $ 8,320 | $ 10,191 | |
Operating lease liabilities | 11,952 | 14,352 | |
Rent expense | $ 18,840 | $ 15,989 | $ 13,814 |
Rent expense | $ 2,800 | ||
Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Remaining lease term | 2 years | ||
Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Remaining lease term | 6 years |
Leases - Summary of Total Lease
Leases - Summary of Total Lease Cost and Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Leases [Abstract] | ||
Operating lease cost | $ 3,231 | $ 3,138 |
Short-term lease cost | 0 | 22 |
Total lease cost | 3,231 | 3,160 |
Cash paid for amounts included in the measurement of lease liabilities | 3,760 | 3,135 |
Right-of-use assets obtained in exchange for lease obligations | $ 0 | $ 1,110 |
Weighted-average remaining lease term | 3 years 7 months 6 days | 4 years 6 months |
Weighted-average discount rate | 10.23% | 10.23% |
Leases - Future Minimum Lease P
Leases - Future Minimum Lease Payments for Operating Leases (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Leases [Abstract] | ||
2021 | $ 3,876 | |
2022 | 3,984 | |
2023 | 3,486 | |
2024 | 1,438 | |
2025 | 1,254 | |
Thereafter | 638 | |
Total future minimum lease payments | 14,676 | |
Less: Imputed interest | (2,724) | |
Operating lease liabilities | $ 11,952 | $ 14,352 |
Share-Based Compensation - Narr
Share-Based Compensation - Narrative (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock based compensation expense | $ 8,100,000 | $ 9,900,000 | $ 8,200,000 |
Options forfeited (in shares) | 700,154 | ||
Grant-date fair value (in usd per shares) | $ 2.17 | ||
Employee Stock Option | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Plan expiration period | 10 years | ||
Vesting period | 4 years | ||
Unrecognized compensation cost, stock options | $ 0 | ||
Options exercised during the period, intrinsic value | $ 1,100,000 | ||
RSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Granted (in shares) | 1,258,059 | ||
Unrecognized compensation, weighted average period for recognition | 2 years 1 month 6 days | ||
Weighted-average grant-date fair value (in usd per share) | $ 1.65 | ||
Aggregate intrinsic value of vested and expected to vest RSUs | $ 9,400,000 | ||
Total intrinsic value of RSUs that vested | 3,600,000 | ||
Unrecognized compensation, RSUs | 6,700,000 | ||
Total fair value of RSUs vested | $ 10,000,000 | ||
Vesting as of First Anniversary | Employee Stock Option | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting percentage | 100.00% | ||
Vesting as of First Anniversary | RSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting percentage | 25.00% | ||
Vesting Each Month After First Anniversary Date | RSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting percentage | 25.00% | ||
2016 Omnibus Incentive Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares reserved for issuance (in shares) | 7,451,291 | ||
Plan expiration period | 10 years | ||
Shares available for grant (in shares) | 3,085,505 | ||
2016 Omnibus Incentive Plan | RSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted-average grant-date fair value (in usd per share) | $ 1.65 |
Share-Based Compensation - Assu
Share-Based Compensation - Assumptions Used to Determine Fair Value (Details) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | ||
Dividend yield | 0.00% | 0.00% |
Risk-free interest rate | 0.53% | |
Risk-free interest rate, minimum | 1.43% | |
Risk-free interest rate, maximum | 2.47% | |
Expected volatility | 52.00% | |
Expected volatility, weighted average | 55.00% | |
Expected volatility, minimum | 52.00% | |
Expected volatility, maximum | 55.00% | |
Expected term | 7 years | 7 years |
Share-Based Compensation - Stoc
Share-Based Compensation - Stock Option Activity (Details) | 12 Months Ended |
Dec. 31, 2020$ / sharesshares | |
Shares | |
Options outstanding, Beginning (in shares) | 2,269,178 |
Granted (in shares) | 55,161 |
Exercised (in shares) | (712,500) |
Expired (in shares) | (25,000) |
Cancelled/Forfeited (in shares) | (700,154) |
Options outstanding, Ending (in shares) | 886,685 |
Options exercisable at (in shares) | 886,685 |
Weighted-Average Exercise Price | |
Outstanding, Beginning (in usd per share) | $ / shares | $ 4.58 |
Granted (in usd per share) | $ / shares | 3.39 |
Exercised (in usd per share) | $ / shares | 2.13 |
Expired (in usd per share) | $ / shares | 2.13 |
Canceled/Forfeited (in usd per share) | $ / shares | 5.32 |
Outstanding, Ending (in usd per share) | $ / shares | 5.94 |
Options exercisable (in usd per share) | $ / shares | $ 5.94 |
Options Outstanding, Weighted-Average Remaining Contractual Life | 3 years 11 months 8 days |
Options exercisable, Weighted-Average Remaining Contractual Life | 3 years 11 months 8 days |
Employee Stock Option | |
Weighted-Average Exercise Price | |
Number of shares withheld for applicable income and other employment taxes | 511,920 |
Share-Based Compensation - Outs
Share-Based Compensation - Outstanding Options at Respective Exercise Price Ranges (Details) | 12 Months Ended |
Dec. 31, 2020$ / sharesshares | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Options outstanding (in shares) | shares | 886,685 |
$2.13 | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise price, low end of range (in dollars per share) | $ 2.13 |
Options outstanding (in shares) | shares | 25,000 |
$4.29 - 4.57 | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise price, low end of range (in dollars per share) | $ 4.29 |
Exercise price, high end of range (in dollars per share) | $ 4.57 |
Options outstanding (in shares) | shares | 200,000 |
$5.15 - 5.59 | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise price, low end of range (in dollars per share) | $ 5.15 |
Exercise price, high end of range (in dollars per share) | $ 5.59 |
Options outstanding (in shares) | shares | 226,687 |
$6.31 | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise price, low end of range (in dollars per share) | $ 6.31 |
Options outstanding (in shares) | shares | 243,821 |
$8.08 - 8.32 | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise price, low end of range (in dollars per share) | $ 8.08 |
Exercise price, high end of range (in dollars per share) | $ 8.32 |
Options outstanding (in shares) | shares | 191,177 |
Share-Based Compensation - RSU
Share-Based Compensation - RSU Activity (Details) | 12 Months Ended |
Dec. 31, 2020$ / sharesshares | |
RSUs | |
Nonvested Restricted Stock Unit Activity | |
Nonvested, Beginning (in shares) | 4,161,862 |
Granted (in shares) | 1,258,059 |
Vested (in shares) | (1,559,107) |
Canceled/Forfeited (in shares) | (936,728) |
Nonvested, Ending (in shares) | 2,924,086 |
Expected to vest (in shares) | 2,355,775 |
Weighted-Average Grant Date Fair Value | |
Nonvested, Beginning (in usd per share) | $ / shares | $ 6.10 |
Granted (in usd per share) | $ / shares | 1.65 |
Vested (in usd per share) | $ / shares | 6.41 |
Canceled/Forfeited (in usd per share) | $ / shares | 5.64 |
Nonvested, Ending (in usd per share) | $ / shares | 4.17 |
Expected to Vest, Weighted-Average Grant-Date Fair Value (in usd per share) | $ / shares | $ 4.28 |
Number of shares withheld for applicable income and other employment taxes | 316,254 |
Employee Stock Option | |
Weighted-Average Grant Date Fair Value | |
Number of shares withheld for applicable income and other employment taxes | 511,920 |
Share-Based Compensation - Empl
Share-Based Compensation - Employee Stock Purchase Plan (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock based compensation expense | $ 8,100 | $ 9,900 | $ 8,200 |
Employee Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares authorized and reserved for the employee stock purchase plan (in shares) | 1,816,716 | ||
Shares available for grant (in shares) | 704,407 | ||
Number of shares purchased under the employee stock purchase plan (in shares) | 528,775 | ||
Stock based compensation expense | $ 637 | $ 676 | $ 562 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - Interest Rate Cap $ in Thousands | Jan. 16, 2018USD ($) |
US Term Note | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Fixed premium on hedge | $ 719 |
ESPV Facility | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Fixed premium on hedge | $ 648 |
Fair Value Measurements - Inter
Fair Value Measurements - Interest Rate Caps (Details) - Interest Rate Cap - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Derivative [Line Items] | ||
Unrecognized gains recognized in Accumulated other comprehensive income | $ 0 | $ 303 |
Interest Expense | ||
Derivative [Line Items] | ||
Gains recognized in Interest expense | 303 | 2,417 |
US Term Note | ||
Derivative [Line Items] | ||
Unrecognized gains recognized in Accumulated other comprehensive income | 0 | 159 |
US Term Note | Interest Expense | ||
Derivative [Line Items] | ||
Gains recognized in Interest expense | 159 | 1,272 |
ESPV Facility | ||
Derivative [Line Items] | ||
Unrecognized gains recognized in Accumulated other comprehensive income | 0 | 144 |
ESPV Facility | Interest Expense | ||
Derivative [Line Items] | ||
Gains recognized in Interest expense | $ 144 | $ 1,145 |
Derivatives (Details)
Derivatives (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Jan. 11, 2018derivative | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Balance at beginning | $ 116,791 | $ 96,156 | |
Balance at ending | 156,489 | 116,791 | |
Interest Rate Cap | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Number of derivative transactions | derivative | 2 | ||
Interest Rate Cap | US Term Note | Cash Flow Hedges | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Balance at beginning | 159 | 0 | |
Gross gains recognized in Accumulated other comprehensive income | 0 | 1,431 | |
Gains reclassified to income through Interest expense | (159) | (1,272) | |
Balance at ending | 0 | 159 | |
Interest Rate Cap | ESPV Facility | Cash Flow Hedges | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Balance at beginning | 144 | 0 | |
Gross gains recognized in Accumulated other comprehensive income | 0 | 1,289 | |
Gains reclassified to income through Interest expense | (144) | (1,145) | |
Balance at ending | $ 0 | $ 144 |
Income Taxes - Income Tax Expen
Income Taxes - Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Current income tax expense (benefit): | |||
Federal | $ 0 | $ 0 | $ (5) |
State | (350) | 576 | 150 |
Total current income tax expense | (350) | 576 | 145 |
Deferred income tax expense (benefit): | |||
Federal | 10,985 | 9,643 | 326 |
State | 275 | 1,940 | (97) |
Total deferred income tax expense | 11,260 | 11,583 | 229 |
Total income tax expense | $ 10,910 | $ 12,159 | $ 374 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Operating Loss Carryforwards [Line Items] | |||
Effective tax rate | 23.00% | 32.00% | 3.00% |
Cash effective tax rate | 2.80% | ||
Adjustment to provisional amounts related to tax reform | $ 970,000 | ||
Adjustment to provisional amounts related to tax reform, percentage impact | (7.00%) | ||
Cumulative pre-tax income position | 3 years | ||
Look forward period for majority of deferred tax assets | 1 year | ||
Unrecognized tax benefits | $ 0 | $ 0 | |
Minimum | |||
Operating Loss Carryforwards [Line Items] | |||
Look forward period | 1 year | ||
Look forward period for minority of deferred tax assets | 3 years | ||
Maximum | |||
Operating Loss Carryforwards [Line Items] | |||
Look forward period | 4 years | ||
Look forward period for minority of deferred tax assets | 4 years | ||
Domestic Tax Authority | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards | $ 64,800,000 |
Income Taxes - Income Tax Rate
Income Taxes - Income Tax Rate Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
Federal statutory rate of 21% | $ 9,894 | $ 8,054 | $ 2,966 |
State income tax provision | (377) | 1,611 | 579 |
Permanent differences | 2,242 | 2,462 | 225 |
Change in statutory tax rate | 0 | 0 | (970) |
Research and development credit | (1,757) | (860) | (2,493) |
Other | 908 | 892 | 67 |
Total income tax expense | $ 10,910 | $ 12,159 | $ 374 |
Income Taxes - Deferred Income
Income Taxes - Deferred Income Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred Tax Assets: | ||
Allowance for losses on loans receivable | $ 4,600 | $ 8,450 |
Net operating loss carryforward | 15,954 | 196 |
Research and development credit | 5,765 | 3,139 |
Deferred equity compensation costs | 1,244 | 2,130 |
Accrued expenses | 8,279 | 3,426 |
Deferred equity issuance costs | 26 | 23 |
Other | 1,165 | 671 |
Total deferred tax assets | 37,033 | 18,035 |
Deferred Tax Liabilities: | ||
Property and equipment, principally due to differences in depreciation | (2,037) | (609) |
Amortization of intangible assets | (7,486) | (7,416) |
Prepaid expenses | (1,552) | (1,226) |
Net deferred tax assets before valuation allowance | 25,958 | 8,784 |
Valuation allowance | 0 | 0 |
Deferred tax assets, net | $ 25,958 | $ 8,784 |
Commitments, Contingencies an_3
Commitments, Contingencies and Guarantees - Narrative (Details) $ in Thousands | Aug. 14, 2020USD ($) | Dec. 31, 2020USD ($)lawsuit | Jun. 30, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Jun. 30, 2017USD ($) | |
Loss Contingencies [Line Items] | ||||||||
Lines of credit to customers | [1] | $ 374,832 | $ 542,073 | |||||
Lease term | 7 years | |||||||
Lease, letter of credit | $ 500 | |||||||
Lease, annual reduction of letter credit | 100 | |||||||
Lessee, letter of credit, minimum balance | $ 100 | |||||||
Cash balance securing letter of credit | 3,135 | 2,235 | $ 2,535 | $ 1,535 | ||||
UK Term Note | Discontinued Operations, Disposed of by Means Other than Sale | Elevate Credit International Limited | Line of Credit | ||||||||
Loss Contingencies [Line Items] | ||||||||
Fair value of guarantee obligation | $ 566 | |||||||
Financial Standby Letter of Credit | ||||||||
Loss Contingencies [Line Items] | ||||||||
Cash balance securing letter of credit | 300 | 400 | ||||||
Indemnification Agreement | ||||||||
Loss Contingencies [Line Items] | ||||||||
Loss contingency accrual | 4,424 | 0 | ||||||
Loss contingency accrual, provision | 7,065 | |||||||
Unfunded Credit Lines | Elastic Product | ||||||||
Loss Contingencies [Line Items] | ||||||||
Lines of credit to customers | 275,900 | 251,200 | ||||||
Unfunded Credit Lines | Rise Product | ||||||||
Loss Contingencies [Line Items] | ||||||||
Lines of credit to customers | 0 | 8,300 | ||||||
Unfunded Credit Lines | Today Card | ||||||||
Loss Contingencies [Line Items] | ||||||||
Lines of credit to customers | $ 5,400 | $ 600 | ||||||
Think Finance Litigation Trust | ||||||||
Loss Contingencies [Line Items] | ||||||||
Damages sought | $ 246,000 | |||||||
Number of lawsuits filed | lawsuit | 2 | |||||||
Think Finance Litigation Trust | Unasserted Claim | ||||||||
Loss Contingencies [Line Items] | ||||||||
Loss contingency accrual | $ 17,000 | |||||||
California Rise Loans | Judicial Ruling | ||||||||
Loss Contingencies [Line Items] | ||||||||
Number of lawsuits filed | lawsuit | 1 | |||||||
California Rise Loans | Pending Litigation | ||||||||
Loss Contingencies [Line Items] | ||||||||
Number of lawsuits filed | lawsuit | 1 | |||||||
[1] | These balances include certain assets and liabilities of variable interest entities (“VIEs”) that can only be used to settle the liabilities of that respective VIE. All assets of the Company are pledged as security for the Company’s outstanding debt, including debt held by the VIEs. For further information regarding the assets and liabilities included in the Company's consolidated accounts, see Note 4— Variable Interest Entities. |
Commitments, Contingencies an_4
Commitments, Contingencies and Guarantees - Amounts Accrued for Contingent Loss under Indemnification Agreement (Details) - Indemnification Agreement $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Loss Contingency Accrual [Roll Forward] | |
Beginning balance at December 31, 2019 | $ 0 |
Expected loss accrual | 7,065 |
Payments made | (2,641) |
Net contingent loss accrual related to a legal matter at December 31, 2020 | $ 4,424 |
Discontinued Operations - Incom
Discontinued Operations - Income Statement Disclosures (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Other expense: | |||||||||||
Net income (loss) from discontinued operations | $ 298 | $ 4,465 | $ (7,540) | $ (12,833) | $ 4,079 | $ 2,116 | $ (2,611) | $ 2,403 | $ (15,610) | $ 5,987 | $ (1,241) |
Elevate Credit International Limited | Discontinued Operations, Disposed of by Means Other than Sale | |||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||
Revenues | 24,012 | 108,089 | 122,966 | ||||||||
Cost of sales: | |||||||||||
Provision for loan losses | 4,785 | 38,579 | 49,780 | ||||||||
Direct marketing costs | 1,372 | 12,735 | 22,882 | ||||||||
Other cost of sales | 10,790 | 18,763 | 14,220 | ||||||||
Total cost of sales | 16,947 | 70,077 | 86,882 | ||||||||
Gross profit | 7,065 | 38,012 | 36,084 | ||||||||
Operating expenses: | |||||||||||
Compensation and benefits | 4,785 | 13,653 | 13,524 | ||||||||
Professional services | 2,879 | 4,881 | 6,040 | ||||||||
Selling and marketing | 605 | 2,608 | 3,241 | ||||||||
Occupancy and equipment | 2,141 | 4,723 | 3,733 | ||||||||
Depreciation and amortization | 1,427 | 1,501 | 1,512 | ||||||||
Other | 288 | 792 | 932 | ||||||||
Total operating expenses | 12,125 | 28,158 | 28,982 | ||||||||
Operating (loss) income | (5,060) | 9,854 | 7,102 | ||||||||
Other expense: | |||||||||||
Net interest expense | (896) | (4,113) | (5,900) | ||||||||
Foreign currency transaction loss | (854) | 334 | (1,409) | ||||||||
Impairment loss | (9,251) | 0 | 0 | ||||||||
Total other expense | (11,001) | (3,779) | (7,309) | ||||||||
Gain (loss) from operations of discontinued operations | (16,061) | 6,075 | (207) | ||||||||
Loss on disposal of discontinued operations | (27,983) | 0 | 0 | ||||||||
Gain (loss) from discontinued operations before taxes | (44,044) | 6,075 | (207) | ||||||||
Income tax benefit (expense) | 28,434 | (88) | (1,034) | ||||||||
Net income (loss) from discontinued operations | $ (15,610) | $ 5,987 | $ (1,241) |
Discontinued Operations - Balan
Discontinued Operations - Balance Sheet Disclosures (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
ASSETS | ||
Total assets classified as discontinued operations in the Condensed Consolidated Balance Sheets | $ 0 | $ 81,002 |
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||
Total liabilities classified as discontinued operations in the Condensed Consolidated Balance Sheets | 0 | 36,541 |
Elevate Credit International Limited | Discontinued Operations, Disposed of by Means Other than Sale | ||
ASSETS | ||
Cash and cash equivalents | 0 | 17,698 |
Restricted cash | 0 | 59 |
Loans receivable, net of allowance for loan losses of $0 and $7,083, respectively | 0 | 31,604 |
Allowance for loan losses | 0 | 7,083 |
Prepaid expenses and other assets | 0 | 4,871 |
Receivable from payment processors | 0 | 1,970 |
Deferred tax assets, net | 0 | 1,355 |
Property and equipment, net | 0 | 14,045 |
Goodwill, net | 0 | 9,251 |
Intangible assets, net | 0 | 149 |
Total assets classified as discontinued operations in the Condensed Consolidated Balance Sheets | 0 | 81,002 |
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||
Accounts payable and accrued liabilities | 0 | 6,917 |
Notes payable, net | 0 | 29,624 |
Total liabilities classified as discontinued operations in the Condensed Consolidated Balance Sheets | $ 0 | $ 36,541 |
Discontinued Operations - Narra
Discontinued Operations - Narrative (Details) - Elevate Credit International Limited - Discontinued Operations, Disposed of by Means Other than Sale $ in Thousands, £ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2020USD ($) | Dec. 31, 2020USD ($) | Jun. 30, 2020USD ($) | Dec. 31, 2020USD ($) | Jun. 29, 2020GBP (£) | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Income tax benefit | $ 24,200 | $ 4,200 | $ 24,200 | $ 28,400 | |
Line of Credit | UK Term Note | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Outstanding balance (in pound sterling) | £ | £ 10.2 | ||||
Fair value of guarantee obligation | $ 566 | $ 566 |
Related Parties - Narrative (De
Related Parties - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Related Party Transaction [Line Items] | ||||
Rent expense | $ 18,840 | $ 15,989 | $ 13,814 | |
Rent expense | 2,800 | |||
Affiliated Entity | Line of Credit | VPC Facility | ||||
Related Party Transaction [Line Items] | ||||
Direct investments in VPC Facility | $ 800 | |||
Interest payments on loan | 81 | 85 | 107 | |
Affiliated Entity | Think Finance | ||||
Related Party Transaction [Line Items] | ||||
Rent expense | 0 | 0 | ||
Rent expense | $ 800 | |||
Affiliated Entity | Other | ||||
Related Party Transaction [Line Items] | ||||
Accounts payable, related parties | 110 | $ 123 | ||
Executive Officer | Indemnification Agreement | ||||
Related Party Transaction [Line Items] | ||||
Related party transaction amount | $ 2,600 |
Related Parties - Expenses Rela
Related Parties - Expenses Related to Board of Directors (Details) - Affiliated Entity - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Related Party Transaction [Line Items] | |||
Operating expenses | $ 2,318 | $ 3,193 | $ 2,154 |
Fees and travel expenses | |||
Related Party Transaction [Line Items] | |||
Operating expenses | 475 | 532 | 543 |
Stock compensation | |||
Related Party Transaction [Line Items] | |||
Operating expenses | 1,693 | 2,361 | 1,311 |
Consulting | |||
Related Party Transaction [Line Items] | |||
Operating expenses | $ 150 | $ 300 | $ 300 |
401(k) Plan (Details)
401(k) Plan (Details) - Think Finance 401(k) Plan - UNITED STATES - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Defined Contribution Plan Disclosure [Line Items] | |||
Minimum age of employee for eligibility | 21 years | ||
Minimum term of employee service for eligibility | 1 month | ||
Matching contribution, percent of match | 100.00% | ||
Matching contribution, percent of participant's compensation | 5.00% | ||
Maximum percentage of eligible earnings each participant may contribute | 70.00% | ||
Employer contributions | $ 3 | $ 2.8 | $ 2.5 |
Quarterly Financial Data (Una_3
Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Total revenue | $ 90,724 | $ 94,164 | $ 117,991 | $ 162,467 | $ 164,137 | $ 164,296 | $ 150,374 | $ 160,066 | $ 465,346 | $ 638,873 | $ 663,716 |
Total cost of sales | 32,253 | 17,421 | 43,428 | 92,214 | 102,523 | 105,076 | 81,864 | 84,830 | 185,316 | 374,293 | 429,061 |
Gross profit | 58,471 | 76,743 | 74,563 | 70,253 | 61,614 | 59,220 | 68,510 | 75,236 | 280,030 | 264,580 | 234,655 |
Net income (loss) from continuing operations | (4,429) | 16,616 | 16,093 | 7,922 | 4,210 | 2,648 | 8,383 | 10,955 | 36,202 | 26,196 | 13,750 |
Net income (loss) from discontinued operations | 298 | 4,465 | (7,540) | (12,833) | 4,079 | 2,116 | (2,611) | 2,403 | (15,610) | 5,987 | (1,241) |
Net income (loss) | $ (4,131) | $ 21,081 | $ 8,553 | $ (4,911) | $ 8,289 | $ 4,764 | $ 5,772 | $ 13,358 | $ 20,592 | $ 32,183 | $ 12,509 |
Basic earnings per share - continuing operations (in usd per share) | $ (0.11) | $ 0.41 | $ 0.38 | $ 0.18 | $ 0.10 | $ 0.06 | $ 0.19 | $ 0.25 | $ 0.88 | $ 0.60 | $ 0.32 |
Basic earnings per share - discontinued operations (in usd per share) | 0.01 | 0.11 | (0.18) | (0.29) | 0.09 | 0.05 | (0.06) | 0.06 | (0.38) | 0.13 | (0.03) |
Basic earnings (loss) per share (in usd per share) | (0.10) | 0.52 | 0.20 | (0.11) | 0.19 | 0.11 | 0.13 | 0.31 | 0.50 | 0.73 | 0.29 |
Diluted earnings per share - continuing operations (in usd per share) | (0.11) | 0.41 | 0.38 | 0.18 | 0.09 | 0.06 | 0.19 | 0.25 | 0.87 | 0.59 | 0.31 |
Diluted earnings per share - discontinued operations operations (in usd per share) | 0.01 | 0.11 | (0.18) | (0.29) | 0.10 | 0.05 | (0.06) | 0.05 | (0.38) | 0.14 | (0.03) |
Diluted earnings (loss) per share (in usd per share) | $ (0.10) | $ 0.52 | $ 0.20 | $ (0.11) | $ 0.19 | $ 0.11 | $ 0.13 | $ 0.30 | $ 0.49 | $ 0.73 | $ 0.28 |
Basic weighted-average shares outstanding (in shares) | 38,851,781 | 40,230,256 | 42,182,412 | 43,161,716 | 44,009,459 | 44,169,964 | 43,681,159 | 43,348,249 | 40,926,581 | 43,805,845 | 42,791,061 |
Diluted weighted-average shares outstanding (in shares) | 38,851,781 | 40,762,330 | 42,511,808 | 43,161,716 | 44,587,331 | 44,743,944 | 44,291,816 | 43,875,410 | 41,761,623 | 44,338,205 | 44,299,304 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ in Thousands | 1 Months Ended | 2 Months Ended | 12 Months Ended | |
Jan. 31, 2021 | Feb. 25, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Subsequent Event [Line Items] | ||||
Common stock repurchased | $ 19,819 | $ 3,344 | ||
Subsequent Event | ||||
Subsequent Event [Line Items] | ||||
Common stock repurchased (in shares) | 1,704,640 | |||
Common stock repurchased | $ 7,300 | |||
4th Tranche Term Note | Line of Credit | Notes Payable to Banks | Subsequent Event | ||||
Subsequent Event [Line Items] | ||||
Extinguishment of debt | $ 18,100 | |||
VPC Facility | Line of Credit | Revolving Credit Facility | Subsequent Event | ||||
Subsequent Event [Line Items] | ||||
Debt paydown | $ 79,500 |