0001213900-20-035932 | 10-Q | XBRL Viewer

Series 2 Preferred Stock Warrants Outstanding

1,992,488

439

Exercise Price 5.50 [Member]

$ 5.50

177,304

Exercise Price 1.25 [Member]

2 years

$ 1.25

1,215,184

Exercise Price 1.76 [Member]

3 years

$ 1.76

40,000

Exercise Price 2.00 [Member]

3 years

$ 2.00

40,000

Exercise Price 1.69 [Member]

3 years

$ 1.69

40,000

Exercise Price 1.54 [Member]

3 years

$ 1.54

40,000

Exercise Price 2.01 [Member]

3 years

$ 2.01

40,000

Exercise Price 2.78 [Member]

3 years

$ 2.78

40,000

Exercise Price 2.53 [Member]

3 years

$ 2.53

40,000

Exercise Price 2.93 [Member]

3 years

$ 2.93

40,000

Exercise Price 1.40 [Member]

3 years

$ 1.40

40,000

Exercise Price 1,250 [Member]

3 years

$ 1,250

Series 2 Preferred Stock Warrants Outstanding

439

^[1]

Exercise Price 1.34 [Member]

3 years

$ 1.34

40,000

Exercise Price 1.74 [Member]

3 years

$ 1.74

40,000

Exercise Price 1.91 [Member]

3 years

$ 1.91

40,000

Exercise Price 1.62 [Member]

3 years

$ 1.62

40,000

Exercise Price 1.95 [Member]

3 years

$ 1.95

40,000

Exercise Price 2.45 [Member]

4 years

$ 2.45

40,000

Commitments and Contingencies Disclosure [Abstract]

3 years

[1]	At September 30, 2020, the above warrants were convertible into 116,903 shares of common stock

Income Taxes (Details)	9 Months Ended
Income Taxes (Details)	Sep. 30, 2020 USD ($)
Income Taxes (Textual)
Operating loss carryforwards expiration period, description	Offset future taxable income which expire from 2024 to 2037. NOLs created after January 1, 2018 do not expire, but are limited.
State and Local Jurisdiction [Member]
Income Taxes (Textual)
Net operating loss carryforwards	$ 6,000,000
Federal [Member]
Income Taxes (Textual)
Net operating loss carryforwards	$ 66,900,000

Exchange Offer of Warrants (Details) - USD ($)		1 Months Ended	9 Months Ended
Exchange Offer of Warrants (Details) - USD ($)	Feb. 04, 2020	Feb. 19, 2020	Sep. 30, 2020
Exchange Offer of Warrants (Textual)
Warrant offered	$ 0.62	$ 0.56
Exchange offer of warrants, description	In total, 5,351,290 warrants were exchanged for 3,317,812 shares of common stock in accordance with the Warrant Exchange Offer.	In total 258,610 warrants were exchanged for 144,871 shares in this transaction.
Deemed dividend			$ 713,212

Loan Payable Under Credit Agreement (Details)	Sep. 30, 2020 USD ($)
Required Covenant [Member]
Short-term Debt [Line Items]
Equity Book Value not less than	$ 8,000,000
Unrestricted Cash greater than	$ 1,500,000
Consolidated Total Debt to Equity Book Value ratio not to exceed	4.75
Actual Position [Member]
Short-term Debt [Line Items]
Equity Book Value not less than	$ 11,236,056
Unrestricted Cash greater than	$ 6,750,019
Consolidated Total Debt to Equity Book Value ratio not to exceed	2.61

Contingencies and other Uncertainties

9 Months Ended

Sep. 30, 2020

CONTINGENCIES AND OTHER UNCERTAINTIES

12. CONTINGENCIES AND OTHER UNCERTAINTIES

The extent of the impact and effects of the recent outbreak of the coronavirus (COVID-19) on the operation and financial performance of our business will depend on future developments, including the duration and spread of the outbreak, the recovery time of the disrupted supply chains, or the uncertainty with respect to the accessibility of additional liquidity or capital markets, all of which are highly uncertain and cannot be predicted. If the demand for the Company's leases are impacted by this outbreak for an extended period, our results of operations may be materially adversely affected.

Loan Payable Under Credit Agreement (Details Textual) - USD ($)		1 Months Ended	3 Months Ended		9 Months Ended
	Apr. 02, 2019	Jan. 31, 2018	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Mar. 06, 2015
Loan Payable Under Credit Agreement (Textual)
Interest expense			$ 951,336	$ 1,061,794	$ 3,214,083	$ 3,265,771
Description of credit facility		Upon 30 days' prior written notice from the applicable noteholder and the Company can prepay principal and interest at any time without penalty.
Outstanding balance credit agreement			24,574,627		24,574,627
Unamortized issuance costs			$ 64,603		$ 64,603
Percentage of borrowing			100.00%		100.00%
Credit Agreement [Member]
Loan Payable Under Credit Agreement (Textual)
Borrowed from lender							$ 32,500,000
Interest expense			$ 708,086	$ 725,702	$ 2,373,525	$ 2,415,231
Description of credit facility	The Commitment Termination Date was extended to February 28, 2021.
Interest rate	11.00%		11.15%		11.15%

Loan Payable Under Credit Agreement

9 Months Ended

Sep. 30, 2020

LOAN PAYABLE UNDER CREDIT AGREEMENT

7. LOAN PAYABLE UNDER CREDIT AGREEMENT

On March 6, 2015, FlexShopper, through a wholly-owned subsidiary (the "Borrower"), entered into a credit agreement (as amended from time-to-time and including the Fee Letter (as defined therein), the "Credit Agreement") with Wells Fargo Bank, National Association as paying agent, various lenders from time to time party thereto and WE 2014-1, LLC, an affiliate of Waterfall Asset Management, LLC, as administrative agent and lender (the "Lender"). The Borrower is permitted to borrow funds under the Credit Agreement based on FlexShopper's cash on hand and the Amortized Order Value of its Eligible Leases (as such terms are defined in the Credit Agreement) less certain deductions described in the Credit Agreement. Under the terms of the Credit Agreement, subject to the satisfaction of certain conditions, the Borrower may borrow up to $32,500,000 from the Lender until the Commitment Termination Date and must repay all borrowed amounts one year thereafter, on the date that is 12 months following the Commitment Termination Date (unless such amounts become due or payable on an earlier date pursuant to the terms of the Credit Agreement). On April 1, 2019, the Commitment Termination Date was extended to February 28, 2021. The Lender was granted a security interest in certain leases as collateral under the Credit Agreement. The interest rate charged on amounts borrowed is LIBOR plus 11% per annum. At September 30, 2020, amounts borrowed bear interest at 11.15% per annum. The Company had $3,419,109 available under the Credit Agreement as of September 30, 2020.

The Credit Agreement provides that FlexShopper may not incur additional indebtedness (other than expressly permitted indebtedness) without the permission of the Lender and also prohibits dividends on common stock. Additionally, the Credit Agreement includes covenants requiring FlexShopper to maintain a minimum amount of Equity Book Value, a minimum amount of Unrestricted Cash (including a reserve upon which the Lender may draw to satisfy unpaid amounts under the Credit Agreement) and a certain ratio of Consolidated Total Debt to Equity Book Value (each capitalized term, as defined in the Credit Agreement). Upon a Permitted Change of Control (as defined in the Credit Agreement), FlexShopper must refinance the debt under the Credit Agreement, subject to the payment of an early termination fee. A summary of the covenant requirements, and FlexShopper's actual results at September 30, 2020, follow:

	September 30, 2020
	Required Covenant		Actual Position

Equity Book Value not less than	$	8,000,000	$	11,236,056
Unrestricted Cash greater than		1,500,000		6,750,019
Consolidated Total Debt to Equity Book Value ratio not to exceed		4.75		2.61

The Credit Agreement includes customary events of default, including, among others, failures to make payment of principal and interest, breaches or defaults under the terms of the Credit Agreement and related agreements entered into with the Lender, breaches of representations, warranties or certifications made by or on behalf of FlexShopper in the Credit Agreement and related documents (including certain financial and expense covenants), deficiencies in the borrowing base, certain judgments against FlexShopper and bankruptcy events.

Availability under the Credit Agreement is subject to a borrowing base which is redetermined from time to time and based on specific advance rates on eligible current assets. Principal payable within twelve months of the balance sheet date based on the outstanding loan balance at such date is reflected as a current liability in the accompanying balance sheets. Interest expense incurred under the Credit Agreement amounted to $708,086 and $2,373,525 for the three and the nine months ended September 30, 2020, respectively, and $725,702 and $2,415,231 for the three and nine months ended September 30, 2019, respectively. As of September 30, 2020, the outstanding balance under the Credit Agreement was $24,574,627. Such amount is presented in the consolidated balance sheet net of unamortized issuance costs of $64,603. Interest is payable monthly on the outstanding balance of the amounts borrowed.

Summary of Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2020

Accounting Policies [Abstract]

Principles of Consolidation

Principles of Consolidation - The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries after elimination of intercompany balances and transactions.

Estimates

Estimates - The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates that affect the reported amounts of assets and liabilities and 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. Actual results could differ from those estimates.

Revenue Recognition

Revenue Recognition - Merchandise is leased to customers pursuant to lease purchase agreements which provide for weekly lease terms with non-refundable lease payments. Generally, the customer has the right to acquire title either through a 90-day same as cash option, an early purchase option, or through payments of all required lease payments, generally 52 weeks, for ownership. On any current lease, customers have the option to cancel the agreement in accordance with lease terms and return the merchandise. Accordingly, customer agreements are accounted for as operating leases with lease revenues recognized in the month they are due on the accrual basis of accounting. Merchandise sales revenue is recognized when the customer exercises the purchase option and pays the purchase price. Revenue for lease payments received prior to their due date is deferred and recognized as revenue in the period to which the payments relate. Revenues from leases and sales are reported net of sales taxes.

Accounts Receivable and Allowance for Doubtful Accounts

Accounts Receivable and Allowance for Doubtful Accounts - FlexShopper seeks to collect amounts owed under its leases from each customer on a weekly or biweekly basis by charging their bank accounts or credit cards. Accounts receivable are principally comprised of lease payments currently owed to FlexShopper which are past due, as FlexShopper has been unable to successfully collect in the manner described above. The allowance for doubtful accounts is based upon revenues and historical experience of balances charged off as a percentage of revenues. The accounts receivable balances consisted of the following as of September 30, 2020 and December 31, 2019:

	September 30, 2020			December 31, 2019

Accounts receivable	$	24,645,435		$	18,249,273
Allowance for doubtful accounts		(16,790,115	)		(9,976,941	)
Accounts receivable, net	$	7,855,320		$	8,272,332

The allowance is a significant percentage of the balance because FlexShopper does not charge off any customer account until it has exhausted all collection efforts with respect to each account, including attempts to repossess items. In addition, while collections are pursued, the same delinquent customers continue to accrue weekly charges until they are charged off. Accounts receivable balances charged off against the allowance were $4,813,162 and $16,830,382 for the three and nine months ended September 30, 2020, respectively, and $9,838,873 and $19,215,275 for the three and nine months ended September 30, 2019, respectively.

	Nine Months Ended September 30, 2020			Year Ended December 31, 2019
Beginning balance	$	9,976,941		$	3,754,306
Provision		23,643,556			34,838,046
Accounts written off		(16,830,382	)		(28,615,411	)
Ending balance	$	16,790,115		$	9,976,941

FlexShopper classifies bad debt expense incurred as a reduction of lease revenue and fees within the consolidated statement of operations.

Lease Merchandise

Lease Merchandise - Until all payment obligations for ownership are satisfied under the lease agreement, the Company maintains ownership of the lease merchandise. Lease merchandise consists primarily of residential furniture, consumer electronics, computers, appliances and household accessories and is recorded at cost net of accumulated depreciation. The Company depreciates leased merchandise using the straight-line method over the applicable agreement period for a consumer to acquire ownership, generally twelve months with no salvage value. Upon transfer of ownership of merchandise to customers resulting from satisfaction of their lease obligations, the related cost and accumulated depreciation are eliminated from lease merchandise. For lease merchandise returned or anticipated to be returned either voluntarily or through repossession, the Company provides an impairment reserve for the undepreciated balance of the merchandise net of any estimated salvage value with a corresponding charge to cost of lease revenue. The cost, accumulated depreciation and impairment reserve related to such merchandise are written off upon determination that no salvage value is obtainable.

The net leased merchandise balances consisted of the following as of September 30, 2020 and December 31, 2019:

	September 30, 2020			December 31, 2019
Lease merchandise at cost	$	52,752,248		$	46,807,570
Accumulated depreciation		(19,780,473	)		(13,518,181	)
Impairment reserve		(2,313,671	)		(2,226,285	)
Lease merchandise, net	$	30,658,104		$	31,063,104

Lease merchandise at cost represents the undepreciated cost of rental merchandise at the time of purchase.

Deferred Debt Issuance Costs

Deferred Debt Issuance Costs - Debt issuance costs incurred in conjunction with the Credit Agreement entered into on March 6, 2015, and subsequent amendments are offset against the outstanding balance of the loan payable and are amortized using the straight-line method over the remaining term of the related debt, which approximates the effective interest method. Amortization, which is included in interest expense, was $45,912 and $216,536 for the three and nine months ended September 30, 2020, respectively, and $103,368 and $208,640 for the three and nine months ended September 30, 2019, respectively.

Debt issuance costs of $60,000 incurred in conjunction with the subordinated Promissory Notes entered into on January 25, 2019 and February 19, 2019 are offset against the outstanding balance of the loan payable and are amortized using the straight-line method over the remaining term of the related debt, which approximates the effective interest method. Amortization, which is included in interest expense, was $4,138 and $17,747 for three and nine months ended September 30, 2020 and $8,138 and $21,701 for the three and nine months ended June 30, 2019, respectively.

Intangible Assets

Intangible Assets - Intangible assets consist of a patent on the Company's LTO payment method at check-out for third party e-commerce sites. Patents are stated at cost less accumulated amortization. Patent costs are amortized by using the straight-line method over the legal life, or if shorter, the useful life of the patent, which has been estimated to be 10 years.

Software Costs

Software Costs - Costs related to developing or obtaining internal-use software incurred during the preliminary project and post-implementation stages of an internal use software project are expensed as incurred and certain costs incurred in the project's application development stage are capitalized as property and equipment. The Company expenses costs related to the planning and operating stages of a website. Costs associated with minor enhancements and maintenance for the website are included in expenses as incurred. Direct costs incurred in the website's development stage are capitalized as property and equipment. Capitalized software costs amounted to $606,500 and $1,804,858 for the three and nine months ended September 30, 2020, respectively, and $535,640 and $1,584,666 for the three and nine months ended September 30, 2019, respectively. Capitalized software amortization expense was $544,475 and $1,550,459 for the three and nine months ended September 30, 2020, respectively, and $513,149 and $1,596,396 for the three and nine months ended September 30, 2019.

Operating Expenses

Operating Expenses - Operating expenses include corporate overhead expenses such as salaries, stock-based compensation, insurance, occupancy, and other administrative expenses.

Marketing Costs

Marketing Costs - Marketing costs, primarily consisting of advertising, are charged to expense as incurred. Direct acquisition costs, primarily consisting of commissions earned based on lease originations, are capitalized and amortized over the life of the lease.

Per Share Data

Per Share Data - Per share data is computed by use of the two-class method as a result of outstanding Series 1 Convertible Preferred Stock, which participates in dividends with the common stock and accordingly has participation rights in undistributed earnings as if all such earnings had been distributed during the period (see Note 8). Under such method income available to common shareholders is computed by deducting both dividends declared or, if not declared, accumulated on Series 2 Convertible Preferred Stock from income from continuing operations and from net income. Loss attributable to common shareholders is computed by increasing loss from continuing operations and net loss by such dividends. Where the Company has undistributed net income available to common shareholders, basic earnings per common share is computed based on the total of any dividends paid or declared per common share plus undistributed income per common share determined by dividing net income available to common shareholders reduced by any dividends paid or declared on common and participating Series 1 Convertible Preferred Stock by the total of the weighted average number of common shares outstanding plus the weighted average number of common shares issuable upon conversion of outstanding participating Series 1 Convertible Preferred Stock during the period. Where the Company has a net loss, basic per share data (including income from continuing operations) is computed based solely on the weighted average number of common shares outstanding during the period. As the participating Series 1 Convertible Preferred Stock has no contractual obligation to share in the losses of the Company, common shares issuable upon conversion of such preferred stock are not included in such computations.

Diluted earnings per share is based on the more dilutive of the if-converted method (which assumes conversion of the participating Series 1 Convertible Preferred Stock as of the beginning of the period) or the two-class method (which assumes that the participating Series 1 Convertible Preferred Stock is not converted) plus the potential impact of dilutive non-participating Series 2 Convertible Preferred Stock, options and warrants. The dilutive effect of stock options and warrants is computed using the treasury stock method, which assumes the repurchase of common shares at the average market price during the period. Under the treasury stock method, options and warrants will have a dilutive effect when the average price of common stock during the period exceeds the exercise price of options or warrants. When there is a loss from continuing operations, potential common shares are not included in the computation of diluted loss per share, since they have an anti-dilutive effect.

In computing diluted loss per share for the nine months ended September 30, 2020 and the nine months ended September 30, 2019, no effect has been given to the issuance of common stock upon conversion or exercise of the following securities as their effect is anti-dilutive. The following table reflects a change in the conversion rates of the Series 1 Convertible Preferred Stock and Series 2 Convertible Preferred Stock due to anti-dilution adjustments as a result of FlexShopper's induced conversion of warrants.

	Nine Months ended
	September 30,
	2020		2019
Series 1 Convertible Preferred Stock		225,231		216,637
Series 2 Convertible Preferred Stock		5,845,695		5,639,745
Series 2 Convertible Preferred Stock issuable upon exercise of warrants		116,903		112,785
Common Stock Options		2,622,869		1,755,818
Common Stock Warrants		1,992,488		7,462,489
		10,803,186		15,187,474

The following table sets forth the computation of basic and diluted earnings per share for the nine months ended September 30, 2020:

	Nine Months ended
	September 30,
	2020			2019
Numerator
Net income	$	78,983		$	1,581,579
Convertible Series 2 Preferred Share dividends		(1,829,217	)		(1,828,167	)
Deemed dividend from exchange offer of warrants		(713,212	)		-
Numerator for basic and diluted EPS	$	(2,463,446	)	$	(246,588	)
Denominator
Denominator for basic and diluted EPS - weighted average shares		20,872,940			17,661,134
Basic EPS	$	(0.12	)	$	(0.01	)
Diluted EPS	$	(0.12	)	$	(0.01	)

Stock-Based Compensation

Stock-Based Compensation - The fair value of transactions in which the Company exchanges its equity instruments for employee and non-employee services (share-based payment transactions) is recognized as an expense in the financial statements as services are performed.

Compensation expense is determined by reference to the fair value of an award on the date of grant and is amortized on a straight-line basis over the vesting period. The Company has elected to use the Black-Scholes-Merton (BSM) pricing model to determine the fair value of all stock option awards.

Fair Value of Financial Instruments

Fair Value of Financial Instruments - The carrying value of certain financial instruments such as cash, accounts receivable, and accounts payable approximate their fair value due to their short-term nature. The carrying value of loans payable under the Credit Agreement increased by unamortized issuance costs approximates fair value. The carrying value of promissory notes to related parties approximates fair value based upon their interest rates, which approximate current market interest rates.

Income Taxes

Income Taxes - Deferred tax assets and liabilities are determined based on the estimated future tax effects of net operating loss carryforwards and temporary differences between the tax bases of assets and liabilities and their respective financial reporting amounts measured at the current enacted tax rates. The Company records a valuation allowance for its deferred tax assets when management concludes that it is not more likely than not that such assets will be recognized.

The Company recognizes a tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing authorities, based on the technical merits of the position. The tax benefits recognized in the consolidated financial statements from such a position are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. As of September 30, 2020, and 2019, the Company had not recorded any unrecognized tax benefits. Interest and penalties related to liabilities for uncertain tax positions will be charged to interest and operating expenses, respectively.

Capital Structure

9 Months Ended

Sep. 30, 2020

Stockholders' Equity Note [Abstract]

CAPITAL STRUCTURE

8. CAPITAL STRUCTURE

The Company's capital structure consists of preferred and common stock as described below:

Preferred Stock

The Company is authorized to issue 500,000 shares of $0.001 par value preferred stock. Of this number of shares, 250,000 shares have been designated as Series 1 Convertible Preferred Stock and 25,000 shares have been designated as Series 2 Convertible Preferred Stock. The Company's Board of Directors determines the rights and preferences of the Company's preferred stock.

●	Series 1 Convertible Preferred Stock - Series 1 Convertible Preferred Stock ("Series 1 Preferred Stock") ranks senior to common stock upon liquidation and has a stated value of $5.00 per share.

As of September 30, 2020, each share of Series 1 Preferred Stock was convertible into 1.32230 shares of the Company's common stock, subject to certain anti-dilution rights. The holders of the Series 1 Preferred Stock have the option to convert the shares into common stock at any time. Upon conversion, all accumulated and unpaid dividends, if any, will be paid as additional shares of common stock. The holders of Series 1 Preferred Stock have the same dividend rights as holders of common stock, as if the Series 1 Preferred Stock had been converted to common stock. The Series 1 Preferred Stockholders vote with holders of common stock and are entitled to a number of votes equal to a fraction, the numerator is 7,700,000 and the denominator is the number of shares of Series 1 Preferred Stock issued.

859 shares of Series 1 Convertible Preferred Stock were converted into 1,136 shares of common stock during the nine months ended September 30, 2020.

As of September 30, 2020, there were 170,332 shares of Series 1 Convertible Preferred Stock outstanding, which were convertible into 225,231 shares of common stock.

●

Series 2 Convertible Preferred Stock - The Company sold to B2 FIE V LLC (the "Investor"), an entity affiliated with Pacific Investment Management Company LLC, 20,000 shares of Series 2 Convertible Preferred Stock ("Series 2 Preferred Stock") for gross proceeds of $20.0 million. The Company sold an additional 1,952 shares of Series 2 Preferred Stock to a different investor for gross proceeds of $1.95 million at a subsequent closing.

The shares of Series 2 Preferred Stock were sold for $1,000 per share (the "Stated Value") and accrue dividends on the Stated Value at an annual rate of 10% compounded annually. Cumulative accrued dividends as of September 30, 2020 totaled approximately $10,222,301. As of September 30, 2020, each share of Series 2 Preferred Stock was convertible into approximately 266 shares of common stock; however, the conversion rate is subject to further increase pursuant to a weighted average anti-dilution provision. The holders of the Series 2 Preferred Stock have the option to convert such shares into shares of common stock and have the right to vote with holders of common stock on an as-converted basis. If the average closing price during any 45-day consecutive trading day period or change of control transaction values the common stock at a price equal to or greater than $23.00 per share, then conversion to common stock is automatic. Upon a Liquidation Event or Deemed Liquidation Event (each as defined), holders of Series 2 Preferred Stock will be entitled to receive out of the assets of the Company prior to and in preference to the common stock and Series 1 Convertible Preferred Stock an amount equal to the greater of (1) the Stated Value, plus any accrued, unpaid dividends thereon, and (2) the amount per share as would have been payable had all shares of Series 2 Preferred Stock been converted to common stock immediately before the Liquidation Event or Deemed Liquidation Event.

Common Stock

The Company is authorized to issue 40,000,000 shares of common stock, par value $0.0001 per share. Each share of common stock entitles the holder to one vote at all stockholder meetings. The common stock is traded on the Nasdaq Capital Market under the symbol "FPAY."

Warrants

In September 2018, the Company issued warrants exercisable for 5,750,000 shares of common stock at an exercise price of $1.25 per share (the "Public Warrants"). The warrants were immediately exercisable for five years from the date of issuance. The warrants were listed on the Nasdaq Capital Market under the symbol "FPAYW" (See note 11).

The Company also issued additional warrants exercisable for an aggregate of 1,055,184 shares of common stock at an exercise price of $1.25 per warrant to Mr. Heiser and NRNS in connection with partial conversions of their promissory notes. The warrants are exercisable at $1.25 per share of common stock and expire on September 28, 2023.

In connection with the issuance of Series 2 Preferred Stock in June 2016, the Company issued to the placement agent in such offering warrants exercisable for 439 shares of Series 2 Preferred Stock at an initial exercise price of $1,250 per share, which expire seven years after the date of issuance.

As part of a Consulting Agreement with XLR8 Capital Partners LLC (the "Consultant"), an entity of which the Company's Chairman is the manager, the Company agreed to issue 40,000 warrants to the Consultant monthly for 12 months beginning on March 1, 2019 at an exercise price of $1.25 per share or, if the closing share price on the last day of the month exceeds $1.25, then such exercise price will be 110% of the closing share price. The warrants are immediately exercisable and expire following the close of business on June 30, 2023. In February 2020, this agreement was extended for an additional six months through August 31, 2020.

On August 30, 2020, the parties entered into an amendment to the Consulting Agreement to further extend the term for another six-month period through February 28, 2021. The Consulting Agreement is also automatically renewable for one successive six-month period thereafter, unless otherwise terminated by the Company prior to such renewal.

This amendment also changed the alternative minimum exercise price of the monthly warrant consideration issuable to the Consultant to $1.60 per share, and the expiration date of the warrants to the date that is four years following the last trading day of the calendar month relating to the applicable monthly warrant issuance.

During the nine months ended September 30, 2020, the Company recorded an expense of $259,040 based on a weighted average valuation of $0.72 per warrant.

	Warrants		Expense		Valuation
Grant Date	Granted		Recorded		Per Warrant
January 31, 2020		40,000	$	16,503	$	0.41
February 29, 2020		40,000	$	18,727	$	0.47
March 31, 2020		40,000	$	8,769	$	0.22
April 30, 2020		40,000	$	25,412	$	0.64
May 31, 2020		40,000	$	33,388	$	0.83
June 30, 2020		40,000	$	36,681	$	0.92
July 31, 2020		40,000	$	29,587	$	0.74
August 31, 2020		40,000	$	46,744	$	1.17
September 30, 2020		40,000	$	43,229	$	1.08
		360,000	$	259,040	$	0.72

The following table summarizes information about outstanding warrants as of September 30, 2020, all of which are exercisable:

		Common		Series 2 Preferred			Weighted Average
Exercise		Stock Warrants		Stock Warrants			Remaining
Price		Outstanding		Outstanding			Contractual Life

$	1.25		1,215,184					3 years
$	1.34		40,000					3 years
$	1.40		40,000					3 years
$	1.54		40,000					3 years
$	1.62		40,000					3 years
$	1.69		40,000					3 years
$	1.74		40,000					3 years
$	1.76		40,000					3 years
$	1.91		40,000					3 years
$	1.95		40,000					4 years
$	2.00		40,000					3 years
$	2.01		40,000					3 years
$	2.45		40,000					3 years
$	2.53		40,000					3 years
$	2.78		40,000					3 years
$	2.93		40,000					3 years
$	5.50		177,304					2 years
$	1,250		-		439	*		3 years
			1,992,488		439

*	At September 30, 2020, the above warrants were convertible into 116,903 shares of common stock

Stock Options (Details Textual) - USD ($)			3 Months Ended		9 Months Ended
Stock Options (Details Textual) - USD ($)	Jun. 10, 2020	May 02, 2019	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Apr. 26, 2018
Stock Options (Textual)
Weighted average grant date fair value of options granted					$ 1.5	$ 0.52
Unrecognized compensation cost related to non-vested options					$ 707,000
Weighted average period					3 years 4 months 17 days
Compensation expense			$ 169,393	$ 117,134	$ 793,241	$ 445,906
Stock Options [Member]
Stock Options (Textual)
Stock options granted period, description	(a) the total number of shares available for issuance under the 2018 Plan by 1,000,000 shares and (b) the number of shares available for issuance as "incentive stock options" within the meaning of Internal Revenue Code Section 422 by 1,000,000 shares.	(a) the total number of shares available for issuance under the 2018 Plan by 1,000,000 shares and (b) the number of shares available for issuance as "incentive stock options" within the meaning of Internal Revenue Code Section 422 by 1,000,000 shares.
Omnibus Equity Compensation Plan One [Member]
Stock Options (Textual)
Common shares authorized for issuance (in shares)							307,000
Omnibus Equity Compensation Plan [Member]
Stock Options (Textual)
Issuance of shares							1,057,000
Common shares authorized for issuance (in shares)							750,000

Leases (Details 3) - USD ($)	9 Months Ended
Leases (Details 3) - USD ($)	Sep. 30, 2020	Sep. 30, 2019
Leases [Abstract]
Cash payments for operating leases
Cash payments for finance leases
New operating lease asset obtained in exchange for lease liabilities
New finance lease asset obtained in exchange for lease liabilities

Summary of Significant Accounting Policies (Details 4) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Numerator
Net (loss)/income	$ 289,360	$ 1,387,982	$ 78,983	$ 1,581,579
Convertible Series 2 Preferred Share dividends			(1,829,217)	(1,828,167)
Deemed dividend from exchange offer of warrants			(713,212)
Numerator for basic and diluted EPS	$ (320,412)	$ 778,265	$ (2,463,446)	$ (246,588)
Denominator
Denominator for basic and diluted EPS - weighted average shares			20,872,940	17,661,134
Basic EPS			$ (0.12)	$ (0.01)
Diluted EPS			$ (0.12)	$ (0.01)

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

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The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.

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The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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Paycheck Protection Program [Abstract]

Leases (Details Textual)	1 Months Ended			9 Months Ended
Leases (Details Textual)	Jan. 31, 2019 USD ($) ft²	Apr. 30, 2018	Aug. 31, 2017	Sep. 30, 2020 USD ($)	Sep. 30, 2019 USD ($)
Leases (Textual)
Operating leases expiration, description				Operating leases expiring at various times through 2028.
Lease description				The Company pays a base monthly rent of $31,532 with payments increasing by 3% on each yearly anniversary of the commencement date. The initial lease term is for 9 years with the Company having a one-time option to extend for 5 years.
Operating lease costs				$ 329,094
Operating lease liability	$ 191,001
Operating lease assets	191,001
Rental expense				$ 519,000	$ 350,000
Description of leasing arrangements		FlexShopper exercised its option to extend the term of the lease to September 30, 2021.
Monthly rent	$ 31,500
Term of lease	108 months		12 months	12 months
Area of land \| ft²	21,622
Additional lease term	5 years		3 years
Annual percentage	3.00%

Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 30, 2020	Nov. 09, 2020
Document and Entity Information [Abstract]
Entity Registrant Name	FlexShopper, Inc.
Entity Central Index Key	0001397047
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Document Type	10-Q
Document Period End Date	Sep. 30, 2020
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2020
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		21,359,945
Entity File Number	001-37945
Entity Interactive Data Current	Yes
Entity Incorporation, State Country Code	DE

Summary of Significant Accounting Policies (Details 1) - USD ($)	9 Months Ended		12 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
Accounting Policies [Abstract]
Beginning balance	$ 9,976,941	$ 3,754,306	$ 3,754,306
Provision	23,643,556	$ 25,075,156	34,838,046
Accounts written off	(16,830,382)		(28,615,411)
Ending balance	$ 16,790,115		$ 9,976,941

Promissory Note-Paycheck Protection Program

9 Months Ended

Sep. 30, 2020

PROMISSORY NOTE PAYCHECK PROTECTION PROGRAM

14. PROMISSORY NOTE- PAYCHECK PROTECTION PROGRAM

FlexShopper, LLC (the "Borrower") applied for and received a loan (the "Loan") on May 4, 2020, from Customers Bank (the "Lender") in the principal amount of $1,914,100, pursuant to the Paycheck Protection Program (the "PPP") under the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act"), which was enacted March 27, 2020, and administered through the U.S. Small Business Administration (the "SBA").

The Loan is evidenced by a promissory note (the "Note"), dated April 30, 2020, issued by the Borrower to the Lender. The Note matures on April 30, 2022, and bears interest at the rate of 1.00% per annum, payable monthly commencing the later of on November 30, 2020 or the SBA review of the forgiveness application. The Note may be prepaid by the Borrower at any time prior to maturity with no prepayment penalty. Proceeds from the Loan will be available to the Borrower to fund designated expenses, including certain payroll costs, group health care benefits and other permitted expenses, in accordance with the PPP. Under the terms of the PPP, up to the entire sum of the principal amount and accrued interest may be forgiven to the extent the Loan proceeds are used for qualifying expenses as described in the CARES Act and applicable implementing guidance issued by the U.S. Small Business Administration under the PPP. The Company used the entire Loan amount for designated qualifying expenses and has submitted a loan forgiveness application to the Lender that is pending review.

Consolidated Balance Sheets (Parenthetical) - USD ($)	Sep. 30, 2020	Dec. 31, 2019
Loan payable unamortized issuance costs	$ 37,685
Promissory notes to related parties net of unamortized issuance costs	12,414	5,333
Loan payable unamortized issuance costs and current portion	26,918	281,138
Promissory notes to related parties net unamortized issuance costs and current portion		$ 24,828
Common stock, par value	$ 0.0001	$ 0.0001
Common stock, shares authorized	40,000,000	40,000,000
Common stock, shares issued	21,359,445	17,783,960
Common stock, shares outstanding	21,359,445	17,783,960
Series 1 Convertible Preferred Stock
Convertible preferred stock, stated value	$ 5	$ 5
Convertible preferred stock, par value	$ 0.001	$ 0.001
Convertible preferred stock, shares authorized	250,000	250,000
Convertible preferred stock, shares issued	170,332	171,191
Convertible preferred stock, shares outstanding	170,332	171,191
Series 2 Convertible Preferred Stock
Convertible preferred stock, stated value	$ 1,000	$ 1,000
Convertible preferred stock, par value	$ 0.001	$ 0.001
Convertible preferred stock, shares authorized	25,000	25,000
Convertible preferred stock, shares issued	21,952	21,952
Convertible preferred stock, shares outstanding	21,952	21,952

Basis of Presentation

9 Months Ended

Sep. 30, 2020

Basis of Presentation [Abstract]

BASIS OF PRESENTATION

1. BASIS OF PRESENTATION

The interim financial statements have been prepared in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X and in conformity with accounting principles generally accepted in the United States of America ("GAAP") applicable to interim financial information. Accordingly, the information presented in the interim financial statements does not include all information and disclosures necessary for a fair presentation of FlexShopper, Inc.'s financial position, results of operations and cash flows in conformity with GAAP for annual financial statements. In the opinion of management, these financial statements reflect all adjustments consisting of normal recurring accruals, necessary for a fair statement of our financial position, results of operations and cash flows for such periods. The results of operations for any interim period are not necessarily indicative of the results for the full year. These financial statements should be read in conjunction with the financial statements and notes thereto contained in FlexShopper, Inc.'s Annual Report on Form 10-K for the year ended December 31, 2019.

The consolidated balance sheet as of December 31, 2019 contained herein has been derived from audited financial statements.

Leases (Details 2)	Sep. 30, 2020
Operating Leases [Member]
Weighted Average Discount Rate	13.07%
Weighted Average Remaining Lease Term (in years)	8 years
Finance Leases [Member]
Weighted Average Discount Rate	13.30%
Weighted Average Remaining Lease Term (in years)	4 years

Promissory Notes-Related Parties (Tables)

9 Months Ended

Sep. 30, 2020

Schedule of amounts payable under the promissory notes

	Debt Principal		Interest
2020	$	-	$	59,465
2021	$	4,750,000	$	-

Summary of Significant Accounting Policies (Details 3) - shares	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share	10,803,186	15,187,474
Common Stock Options [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share	2,622,869	1,755,818
Common Stock Warrants [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share	1,992,488	7,462,489
Series 1 Convertible Preferred Stock [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share	225,231	216,637
Series 2 Convertible Preferred Stock [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share	5,845,695	5,639,745
Series 2 Convertible Preferred Stock issuable upon exercise of warrants [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share	116,903	112,785

Exchange Offer of Warrants

9 Months Ended

Sep. 30, 2020

Warrants [Abstract]

EXCHANGE OFFER OF WARRANTS

11. EXCHANGE OFFER OF WARRANTS

On February 4, 2020, the Company completed an exchange offer relating to its outstanding public warrants, in which the holders of the public warrants were offered 0.62 shares of common stock for each outstanding warrant tendered (the "Warrant Exchange Offer").

In total, 5,351,290 warrants were exchanged for 3,317,812 shares of common stock in accordance with the Warrant Exchange Offer.

On February 19, 2020, the Company exchanged all remaining untendered public warrants for common stock at a rate of 0.56 shares per public warrant in accordance with the terms of the Warrant Agreement (the "Mandatory Conversion of Warrants"). In total 258,610 warrants were exchanged for 144,871 shares in this transaction.

As a result of this transaction, the Company recognized a deemed dividend of $713,212 resulting from the excess of the fair value of the common stock over the intrinsic value of the warrants.

Loan Payable Under Credit Agreement (Tables)

9 Months Ended

Sep. 30, 2020

Schedule of covenant requirements, and FlexShopper's actual results

	September 30, 2020
	Required Covenant		Actual Position

Equity Book Value not less than	$	8,000,000	$	11,236,056
Unrestricted Cash greater than		1,500,000		6,750,019
Consolidated Total Debt to Equity Book Value ratio not to exceed		4.75		2.61

Income Taxes

9 Months Ended

Sep. 30, 2020

Income Tax Disclosure [Abstract]

INCOME TAXES

10. INCOME TAXES

As of September 30, 2020, the Company had federal net operating loss carryforwards ("NOL") of approximately $66,900,000 and state net operating loss carryforwards of approximately $6,000,000 available to offset future taxable income which expire from 2024 to 2037. NOLs created after January 1, 2018 do not expire, but are limited.

Management believes that the federal and state deferred tax asset as of September 30, 2020 does not satisfy the realization criteria and has recorded a full valuation allowance to offset the deferred tax asset.

Schedule of accounts receivable

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References + Details

Summary of Significant Accounting Policies (Tables)

9 Months Ended

Sep. 30, 2020

Accounting Policies [Abstract]

	September 30, 2020			December 31, 2019

Accounts receivable	$	24,645,435		$	18,249,273
Allowance for doubtful accounts		(16,790,115	)		(9,976,941	)
Accounts receivable, net	$	7,855,320		$	8,272,332

Schedule of allowance for doubtful accounts

	Nine Months Ended September 30, 2020			Year Ended December 31, 2019
Beginning balance	$	9,976,941		$	3,754,306
Provision		23,643,556			34,838,046
Accounts written off		(16,830,382	)		(28,615,411	)
Ending balance	$	16,790,115		$	9,976,941

Schedule of net leased merchandise

	September 30, 2020			December 31, 2019
Lease merchandise at cost	$	52,752,248		$	46,807,570
Accumulated depreciation		(19,780,473	)		(13,518,181	)
Impairment reserve		(2,313,671	)		(2,226,285	)
Lease merchandise, net	$	30,658,104		$	31,063,104

Schedule of anti-dilutive securities excluded from computation of earnings per share

	Nine Months ended
	September 30,
	2020		2019
Series 1 Convertible Preferred Stock		225,231		216,637
Series 2 Convertible Preferred Stock		5,845,695		5,639,745
Series 2 Convertible Preferred Stock issuable upon exercise of warrants		116,903		112,785
Common Stock Options		2,622,869		1,755,818
Common Stock Warrants		1,992,488		7,462,489
		10,803,186		15,187,474

Schedule of basic and diluted earnings per share

	Nine Months ended
	September 30,
	2020			2019
Numerator
Net income	$	78,983		$	1,581,579
Convertible Series 2 Preferred Share dividends		(1,829,217	)		(1,828,167	)
Deemed dividend from exchange offer of warrants		(713,212	)		-
Numerator for basic and diluted EPS	$	(2,463,446	)	$	(246,588	)
Denominator
Denominator for basic and diluted EPS - weighted average shares		20,872,940			17,661,134
Basic EPS	$	(0.12	)	$	(0.01	)
Diluted EPS	$	(0.12	)	$	(0.01	)

Consolidated Statements of Operations (unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Revenues:
Lease revenues and fees, net	$ 23,391,348	$ 22,267,261	$ 69,989,333	$ 63,953,196
Lease merchandise sold	1,178,716	665,074	3,953,608	2,374,876
Total revenues	24,570,064	22,932,335	73,942,941	66,328,072
Costs and expenses:
Cost of lease revenues, consisting of depreciation and impairment of lease merchandise	14,886,798	14,248,969	46,982,002	43,787,216
Cost of lease merchandise sold	763,728	457,399	2,685,599	1,521,244
Marketing	1,650,717	868,452	3,619,911	2,031,227
Salaries and benefits	2,499,235	2,189,629	7,324,620	5,984,797
Operating expenses	3,528,890	2,718,110	10,037,743	8,156,238
Total costs and expenses	23,329,368	20,482,559	70,649,875	61,480,722
Operating income	1,240,696	2,449,776	3,293,066	4,847,350
Interest expense including amortization of debt issuance costs	951,336	1,061,794	3,214,083	3,265,771
Net income	289,360	1,387,982	78,983	1,581,579
Deemed dividend from exchange offer of warrants			713,212
Dividends on Series 2 Convertible Preferred Shares	609,772	609,717	1,829,217	1,828,167
Net income/ (loss) attributable to common stockholders	$ (320,412)	$ 778,265	$ (2,463,446)	$ (246,588)
Basic and diluted loss per common share:
Basic and diluted	$ (0.02)	$ 0.04	$ (0.12)	$ (0.01)
WEIGHTED AVERAGE COMMON SHARES:
Basic	21,358,141	17,666,193	20,872,940	17,661,134
Diluted	21,358,141	19,798,386	20,872,940	17,661,134

Commitments

9 Months Ended

Sep. 30, 2020

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS

13. COMMITMENTS

The Company does not have any commitments other than real property leases (see Note 4).

Stock Options (Tables)

9 Months Ended

Sep. 30, 2020

Share-based Payment Arrangement [Abstract]

Schedule of information about stock options

	Number of options			Weighted average exercise price		Weighted average contractual term (years)		Aggregate intrinsic value
Outstanding at January 1, 2020		2,004,318		$	1.72			$	2,542,361
Granted		691,046			2.52
Forfeited		(65,829	)		0.91				20,048
Exercise		(6,666	)		0.79				6,032
Outstanding at September 30, 2020		2,622,869		$	1.95		7.73	$	1,209,562
Vested and exercisable at September 30, 2020		1,676,871		$	1.97		8.04	$	1,000,844

Outstanding at January 1, 2019		620,900		$	3.75
Granted		1,334,851			0.85
Forfeited		(174,933	)		1.36				100,087
Expired		(25,000	)		6.20
Outstanding at September 30, 2019		1,755,818		$	1.75		8.83	$	952,494
Vested and exercisable at September 30, 2019		803,126		$	2.64		8.18	$	334,420

Schedule of option input into a Black Scholes option pricing model

	Nine Months ended
	September 30,
	2020			2019
Exercise price	$	1.5		$	0.85
Expected life		5 years			6.8 years
Expected volatility		73	%		63	%
Dividend yield		0	%		0	%
Risk-free interest rate		1.15	%		2.40	%

Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2020

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

	September 30, 2020			December 31, 2019

Accounts receivable	$	24,645,435		$	18,249,273
Allowance for doubtful accounts		(16,790,115	)		(9,976,941	)
Accounts receivable, net	$	7,855,320		$	8,272,332

	Nine Months Ended September 30, 2020			Year Ended December 31, 2019
Beginning balance	$	9,976,941		$	3,754,306
Provision		23,643,556			34,838,046
Accounts written off		(16,830,382	)		(28,615,411	)
Ending balance	$	16,790,115		$	9,976,941

FlexShopper classifies bad debt expense incurred as a reduction of lease revenue and fees within the consolidated statement of operations.

The net leased merchandise balances consisted of the following as of September 30, 2020 and December 31, 2019:

	September 30, 2020			December 31, 2019
Lease merchandise at cost	$	52,752,248		$	46,807,570
Accumulated depreciation		(19,780,473	)		(13,518,181	)
Impairment reserve		(2,313,671	)		(2,226,285	)
Lease merchandise, net	$	30,658,104		$	31,063,104

Lease merchandise at cost represents the undepreciated cost of rental merchandise at the time of purchase.

Operating Expenses - Operating expenses include corporate overhead expenses such as salaries, stock-based compensation, insurance, occupancy, and other administrative expenses.

	Nine Months ended
	September 30,
	2020		2019
Series 1 Convertible Preferred Stock		225,231		216,637
Series 2 Convertible Preferred Stock		5,845,695		5,639,745
Series 2 Convertible Preferred Stock issuable upon exercise of warrants		116,903		112,785
Common Stock Options		2,622,869		1,755,818
Common Stock Warrants		1,992,488		7,462,489
		10,803,186		15,187,474

The following table sets forth the computation of basic and diluted earnings per share for the nine months ended September 30, 2020:

	Nine Months ended
	September 30,
	2020			2019
Numerator
Net income	$	78,983		$	1,581,579
Convertible Series 2 Preferred Share dividends		(1,829,217	)		(1,828,167	)
Deemed dividend from exchange offer of warrants		(713,212	)		-
Numerator for basic and diluted EPS	$	(2,463,446	)	$	(246,588	)
Denominator
Denominator for basic and diluted EPS - weighted average shares		20,872,940			17,661,134
Basic EPS	$	(0.12	)	$	(0.01	)
Diluted EPS	$	(0.12	)	$	(0.01	)

Property and Equipment

9 Months Ended

Sep. 30, 2020

Property, Plant and Equipment [Abstract]

PROPERTY AND EQUIPMENT

5. PROPERTY AND EQUIPMENT

Property and equipment consist of the following:

	Estimated Useful Lives	September 30, 2020			December 31, 2019
Furniture, fixtures and vehicle	2-5 years	$	111,052		$	95,671
Website and internal use software	3 years		11,928,687			10,123,830
Computers and software	3-7 years		876,358			596,946
			12,916,097			10,816,447
Less: accumulated depreciation and amortization			(9,088,367	)		(7,435,271	)
Right of use assets, net			1,735,874			1,879,231
		$	5,563,604		$	5,260,407

Depreciation and amortization expense were $592,498 and $530,520 for the three months ended September 30, 2020 and 2019, respectively, and $1,653,099 and $1,647,290 for the nine months ended September 30, 2020 and 2019, respectively.

Promissory Notes-Related Parties (Details Textual) - USD ($)	1 Months Ended						3 Months Ended		9 Months Ended
	Apr. 30, 2020	Feb. 19, 2019	Jan. 25, 2019	Sep. 30, 2018	Aug. 29, 2018	Jan. 31, 2018	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Promissory Notes (Textual)
Description of credit facility						Upon 30 days' prior written notice from the applicable noteholder and the Company can prepay principal and interest at any time without penalty.
Description of notes						The Company paid down the entire principal and interest balance on June 28, 2019 in the amount of $507,339. NRNS amended and restated the NRNS Note such that the maturity date of the revised Note was set at June 30, 2021. In addition, the Company borrowed $500,000 on the Note held by NRNS on June 28, 2019. As of September 30, 2020, $1,771,909 of principal and accrued, unpaid interest was outstanding on NRNS's Note.
Debt instrument maturity date	Apr. 30, 2021
Interest expense related party							$ 186,882	$ 222,863	$ 593,738	$ 617,165
NRNS [Member]
Promissory Notes (Textual)
Description of credit facility		Payment of principal and accrued interest under the February 2019 Note is due and payable by FlexShopper, LLC on June 30, 2021 and FlexShopper, LLC can prepay principal and interest at any time without penalty.
Interest rate							16.15%		16.15%
Description of notes					FlexShopper, LLC issued amended and restated Notes to Mr. Heiser and NRNS under which (1) the maturity date for such Notes was set at June 30, 2019 and (2) in connection with the completion of an Equity Financing (as defined in the Notes), the holders of such Notes were granted the option to convert up to 50% of the outstanding principal of the Notes plus accrued and unpaid interest thereon into the securities issued in the Equity Financing at a conversion price equal to the price paid to the Company by the underwriters for such securities, net of the underwriting discount. In connection with the offering of units in September 2018, Mr. Heiser and NRNS elected to convert the convertible portion of the Notes, resulting in the issuance by the Company of 602,974 shares of common stock and warrants to purchase 301,487 shares to Mr. Heiser, and 1,507,395 shares of common stock and warrants to purchase 753,697 shares to NRNS.				As of September 30, 2020, $2,025,039 of principal and accrued, unpaid interest was outstanding on the February 2019 Note.
Principal amount		$ 2,000,000
Commitment fee percentage		2.00%
Lender total value		$ 40,000
Issuance of common stock				1,507,395
Issuance of warrants to purchase				753,697
Bear interest rate							(5.00%)		(5.00%)
Heiser [Member]
Promissory Notes (Textual)
Interest rate							16.18%		16.18%
Description of notes									Upon issuance of the Notes, FlexShopper, LLC borrowed $500,000 and a subsequent $500,000 on February 20, 2018 on the Note held by Mr. Heiser and $2,500,000 on the Note held by NRNS.
Issuance of common stock				602,974
Issuance of warrants to purchase				301,487
Bear interest rate							(5.00%)		(5.00%)
122 Partners, LLC [Member]
Promissory Notes (Textual)
Description of notes									As of September 30, 2020, $1,012,517 of principal and accrued, unpaid interest was outstanding on the January 2019 Note.
Chief Financial Officer [Member]
Promissory Notes (Textual)
Description of credit facility			Payment of the principal amount and accrued interest under the January 2019 Note was due and payable by FlexShopper, LLC on April 30, 2020 and FlexShopper, LLC can prepay principal and interest at any time without penalty.
Interest rate							16.15%		16.15%
Description of notes									As of September 30, 2020, $1,771,909 of principal and accrued, unpaid interest was outstanding on NRNS's Note.
Principal amount			$ 1,000,000
Commitment fee percentage			2.00%
Lender total value			$ 20,000
Minimum [Member]
Promissory Notes (Textual)
Principal amount						$ 1,000,000
Maximum [Member]
Promissory Notes (Textual)
Principal amount						$ 2,500,000

Business and Liquidity (Details)	9 Months Ended
Business and Liquidity (Details)	Sep. 30, 2020
Business and Liquidity (Textual)
Ownership percentage	100.00%
Future growth term	12 months
Credit agreement, description	The Company would then start to repay all borrowed amounts under the facility through February 21, 2022. Additionally, $ 3,750,000 and $1,000,000 of Promissory Notes (see Note 6) are due by June 30, 2021 and April 30, 2021, respectively.
FlexShopper, LLC [Member]
Business and Liquidity (Textual)
Limited liability percentage of FlexShopper, LLC	100.00%

Promissory Note-Paycheck Protection Program (Details)	May 04, 2020 USD ($)
Paycheck Protection Program [Abstract]
Principal amount	$ 1,914,100
Maturity date, description	The Note matures on April 30, 2022, and bears interest at the rate of 1.00% per annum, payable monthly commencing on November 30, 2020, following an initial deferral period as specified under the PPP.

Capital Structure (Tables)

9 Months Ended

Sep. 30, 2020

Stockholders' Equity Note [Abstract]

Schedule of weighted average valuation

	Warrants		Expense		Valuation
Grant Date	Granted		Recorded		Per Warrant
January 31, 2020		40,000	$	16,503	$	0.41
February 29, 2020		40,000	$	18,727	$	0.47
March 31, 2020		40,000	$	8,769	$	0.22
April 30, 2020		40,000	$	25,412	$	0.64
May 31, 2020		40,000	$	33,388	$	0.83
June 30, 2020		40,000	$	36,681	$	0.92
July 31, 2020		40,000	$	29,587	$	0.74
August 31, 2020		40,000	$	46,744	$	1.17
September 30, 2020		40,000	$	43,229	$	1.08
		360,000	$	259,040	$	0.72

Schedule of outstanding stock warrants

		Common		Series 2 Preferred			Weighted Average
Exercise		Stock Warrants		Stock Warrants			Remaining
Price		Outstanding		Outstanding			Contractual Life

$	1.25		1,215,184					3 years
$	1.34		40,000					3 years
$	1.40		40,000					3 years
$	1.54		40,000					3 years
$	1.62		40,000					3 years
$	1.69		40,000					3 years
$	1.74		40,000					3 years
$	1.76		40,000					3 years
$	1.91		40,000					3 years
$	1.95		40,000					4 years
$	2.00		40,000					3 years
$	2.01		40,000					3 years
$	2.45		40,000					3 years
$	2.53		40,000					3 years
$	2.78		40,000					3 years
$	2.93		40,000					3 years
$	5.50		177,304					2 years
$	1,250		-		439	*		3 years
			1,992,488		439

*	At September 30, 2020, the above warrants were convertible into 116,903 shares of common stock

Consolidated Statements of Cash Flows (unaudited) - USD ($)	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ 78,983	$ 1,581,579
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and impairment of lease merchandise	46,982,002	43,787,216
Other depreciation and amortization	1,889,690	1,879,935
Compensation expense related to issuance of stock options and warrants	1,052,281	530,724
Provision for doubtful accounts	23,643,556	25,075,156
Interest in kind added to promissory notes balance	7,814
Changes in operating assets and liabilities:
Accounts receivable	(23,226,544)	(26,675,773)
Prepaid expenses and other	(120,482)	(290,556)
Lease merchandise	(46,577,002)	(35,764,135)
Security deposits	2,943	1,334
Accounts payable	485,878	(5,656,655)
Accrued payroll and related taxes	62,108	(161,009)
Accrued expenses	273,903	(317,173)
Net cash provided by operating activities	4,555,130	3,990,643
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property and equipment, including capitalized software costs	(2,099,654)	(1,664,580)
Net cash used in investing activities	(2,099,654)	(1,664,580)
CASH FLOWS FROM FINANCING ACTIVITIES
Principal payment under finance lease obligation	(4,891)	(1,243)
Refund of equity issuance related costs		23,147
Proceeds from exercise of warrants	131,250
Proceeds from exercise of stock options	5,267
Proceeds from promissory notes- Paycheck Protection Program, net of fees	1,914,100
Proceeds from promissory notes to related parties, net of fees		3,440,000
Proceeds from loan payable under credit agreement	2,412,000	2,523,828
Repayment of loan payable under credit agreement	(7,023,250)	(10,528,488)
Repayment of promissory note		(500,000)
Repayment of instalment loan	(8,405)	(8,405)
Debt issuance related costs		(243,750)
Net cash used in financing activities	(2,573,929)	(5,294,911)
DECREASE IN CASH	(118,453)	(2,968,848)
CASH, beginning of period	6,868,472	6,141,210
CASH, end of period	6,750,019	3,172,362
Supplemental cash flow information:
Interest paid	3,021,833	2,700,709
Deemed dividend from exchange offer of warrants	713,212
Conversion of preferred stock to common stock	$ 4,295	$ 341,070

Leases (Details 4)	Sep. 30, 2020 USD ($)
Operating Leases [Member]
2020	$ 104,573
2021	415,050
2022	405,443
2023	417,606
2024	430,134
2025 and thereafter	1,672,961
Total undiscounted cash flows	3,445,767
Less: interest	(1,331,375)
Present value of lease liabilities	2,114,392
Finance Leases [Member]
2020	2,796
2021	11,184
2022	11,184
2023	9,699
2024	4,781
Total undiscounted cash flows	39,644
Less: interest	(8,306)
Present value of lease liabilities	$ 31,338

Summary of Significant Accounting Policies (Details 2) - USD ($)	Sep. 30, 2020	Dec. 31, 2019
Accounting Policies [Abstract]
Lease merchandise at cost	$ 52,752,248	$ 46,807,570
Accumulated depreciation	(19,780,473)	(13,518,181)
Impairment reserve	(2,313,671)	(2,226,285)
Lease merchandise, net	$ 30,658,104	$ 31,063,104

Property and Equipment (Details) - USD ($)	9 Months Ended
Property and Equipment (Details) - USD ($)	Sep. 30, 2020	Dec. 31, 2019
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 12,916,097	$ 10,816,447
Less: accumulated depreciation and amortization	(9,088,367)	(7,435,271)
Right of use assets, net	1,735,874	1,879,231
Property and equipment, net	5,563,604	5,260,407
Furniture, fixtures and vehicle [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	111,052	95,671
Website and internal use software [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 11,928,687	10,123,830
Estimated Useful Lives	3 years
Computers and software [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 876,358	$ 596,946
Minimum [Member] \| Furniture, fixtures and vehicle [Member]
Property, Plant and Equipment [Line Items]
Estimated Useful Lives	2 years
Minimum [Member] \| Computers and software [Member]
Property, Plant and Equipment [Line Items]
Estimated Useful Lives	3 years
Maximum [Member] \| Furniture, fixtures and vehicle [Member]
Property, Plant and Equipment [Line Items]
Estimated Useful Lives	5 years
Maximum [Member] \| Computers and software [Member]
Property, Plant and Equipment [Line Items]
Estimated Useful Lives	7 years

Leases (Details)	Sep. 30, 2020 USD ($)
Leases [Abstract]
2020	$ 107,000
2021	426,000
2022	417,000
2023	427,000
2024	435,000
Thereafter	1,673,000
Total	$ 3,485,000

Capital Structure (Details Textual) - USD ($)	1 Months Ended		9 Months Ended
Capital Structure (Details Textual) - USD ($)	Sep. 30, 2018	Jun. 30, 2016	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
Capital Structure (Textual)
Common stock, shares authorized			40,000,000		40,000,000
Common stock, par value			$ 0.0001		$ 0.0001
Issuance of warrants			$ 131,250
Warrants convertible into common stock			116,903
Preferred Stock [Member]
Capital Structure (Textual)
Preferred stock, par value			$ 0.001
Preferred stock, shares authorized			500,000
Common Stock [Member]
Capital Structure (Textual)
Common stock, shares authorized			40,000,000
Common stock, par value			$ 0.0001
Convertible preferred stock, terms of conversion, description			The Company is authorized to issue 40,000,000 shares of common stock, par value $0.0001 per share. Each share of common stock entitles the holder to one vote at all stockholder meetings.
Common stock price			$ 23.00
Series Two Convertible Preferred Stock [Member]
Capital Structure (Textual)
Description of warrants expiration		The Company issued to the placement agent in such offering warrants exercisable for 439 shares of Series 2 Convertible Preferred Stock at an initial exercise price of $1,250 per share, which expire seven years after the date of issuance.
Series 1 Convertible Preferred Stock [Member]
Capital Structure (Textual)
Preferred stock conversion into common stock, shares			7,700,000
Common stock, par value			$ 5.00
Convertible preferred stock, terms of conversion, description			859 shares of Series 1 Convertible Preferred Stock were converted into 1,136 shares of common stock during the nine months ended September 30, 2020. As of September 30, 2020, there were 170,332 shares of Series 1 Convertible Preferred Stock outstanding, which were convertible into 225,231 shares of common stock.
Convertible, conversion price per share			$ 1.32230
Series 1 Convertible Preferred Stock [Member] \| Preferred Stock [Member]
Capital Structure (Textual)
Preferred stock, shares authorized			250,000
Series 2 Convertible Preferred Stock [Member]
Capital Structure (Textual)
Preferred stock, designated			25,000
Preferred stock conversion into common stock, shares			266
Proceeds from sale of stock			$ 20,000,000
Convertible preferred stock, shares issued upon conversion			20,000
Convertible preferred stock, stated value			$ 1,000
Gross proceeds			$ 1,950,000
Additional sale of shares			1,952
Cumulative accrued dividends			$ 10,222,301
Stated value, percentage			10.00%
Warrant [Member]
Capital Structure (Textual)
Common stock warrants outstanding			1,992,488
Series 2 preferred stock warrants outstanding			439
Warrants exercisable for shares of common stock	5,750,000		1,055,184
Description of warrants expiration	The warrants were immediately exercisable and expire five years from the date of issuance.		The warrants are exercisable at $1.25 per share of common stock and expire on September 28, 2023.
Warrant exercise price	$ 1.25		$ 1.25
Valuation Expenses			$ 259,040
weighted average valuation			$ 0.72
Issuance of warrants			$ 40,000
Warrant [Member] \| Consultant [Member]
Capital Structure (Textual)
Description of warrants expiration			The warrants are immediately exercisable and expire following the close of business on June 30, 2023.
Warrant exercise price			$ 1.25
Warrant, description			If the closing share price on the last day of the month exceeds $1.25, then such exercise price will be 110% of the closing share price.

Leases

9 Months Ended

Sep. 30, 2020

Leases [Abstract]

LEASES

4. LEASES

Lease Commitments

In August 2017, FlexShopper entered into a 12-month lease with two additional three-year options for retail store space in West Palm Beach, Florida. In April 2018, FlexShopper exercised its option to extend the term of the lease to September 30, 2021.

In January 2019, FlexShopper entered into a 9 years lease with an option for one additional five-year term for 21,622 square feet of office space in Boca Raton, FL to accommodate FlexShopper's business and its employees (the "January 2019 Lease"). The monthly rent for this space is approximately $31,500 with annual three percent increases throughout the initial 108-month lease term beginning on the anniversary of the commencement date.

The rental expense for the nine months ended September 30, 2020 and 2019 was approximately $519,000 and $350,000, respectively. As of September 30, 2020, the future minimum annual lease payments are approximately as follows:

2020	$	107,000
2021		426,000
2022		417,000
2023		427,000
2024		435,000
Thereafter		1,673,000
	$	3,485,000

Lessor Information - Refer to Note 3 to these condensed consolidated financial statements for further information about the Company's revenue generating activities as a lessor. All of the Company's customer agreements are considered operating leases, and the Company currently does not have any sales-type or direct financing leases.

Lessee Information - As a result of ASC 842, Leases, the Company in its position as a lessee has recognized all of its operating and financing leases on the balance sheet as right-to-use asset and lease liabilities. The Company has elected a package of optional practical expedients. As a lessee, the Company leases retail, call center and corporate space under operating leases expiring at various times through 2028. At January 1, 2019, the Company recognized $191,001 of operating lease assets and $191,001 of operating lease liabilities as a result of adopting Topic 842.

The Company determines if an arrangement is a lease at inception. The breakout of operating lease assets, and current and non-current operating lease liabilities as of September 30, 2020, is shown in the table below.

Supplemental balance sheet information related to leases is as follows:

	Balance Sheet Classification	September 30, 2020		December 31, 2019
Assets
Operating Lease Asset	Property and Equipment, net	$	1,706,695	$	1,847,932
Finance Lease Asset	Property and Equipment, net		29,179		31,299
Total Lease Assets		$	1,735,874	$	1,879,231

Liabilities
Operating Lease Liability - current portion	Current Lease Liabilities	$	152,063	$	22,088
Finance Lease Liability - current portion	Current Lease Liabilities		7,458		5,638
Operating Lease Liability- net of current portion	Long Term Lease Liabilities		1,962,329		2,040,576
Finance Lease Liability - net of current portion	Long Term Lease Liabilities		23,880		26,608
Total Lease Liabilities		$	2,145,730	$	2,094,910

Operating lease assets and liabilities are recognized at the present value of the future lease payments at the lease commencement date. The Company uses its incremental borrowing rate as the discount rate for its leases, as the implicit rate in the lease is not readily determinable. The incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments, and in economic environments where the leased asset is located. Operating lease assets also include any prepaid lease payments and lease incentives. The lease terms include periods under options to extend or terminate the lease when it is reasonably certain that the Company will exercise the option. The Company generally uses the base, non-cancelable, lease term when determining the lease assets and liabilities. Under the short-term lease exception provided within ASC 842, the Company does not record a lease liability or right-of-use asset for any leases that have a lease term of 12 months or less at commencement.

Below is a summary of the weighted-average discount rate and weighted-average remaining lease term for the Company's leases:

	Weighted Average Discount Rate			Weighted Average Remaining Lease Term (in years)
Operating Leases		13.07	%		8
Finance Leases		13.30	%		4

Upon adoption of Topic 842, discount rates for existing operating leases were established as of January 1, 2019. The discount rate for the new operating lease for space in 901 Yamato Road, Boca Raton, FL was established as of the commencement date of the lease.

Operating lease expense is recognized on a straight-line basis over the lease term within operating expenses in the Company's consolidated statements of operations. Finance lease expense is recognized over the lease term within interest expense and amortization in the Company's consolidated statements of operations. The Company's total operating and finance lease expense all relate to lease costs and amounted to $329,094 for the nine months ended September 30, 2020.

Supplemental cash flow information related to operating leases is as follows:

	Nine Months ended
	September 30,
	2020		2019
Cash payments for operating leases	$	116,860	$	157,719
Cash payments for finance leases		8,253		2,391
New operating lease asset obtained in exchange for lease liabilities		-		1,869,287
New finance lease asset obtained in exchange for lease liabilities		4,033		34,772

Below is a summary of undiscounted operating lease liabilities as of September 30, 2020. The table also includes a reconciliation of the future undiscounted cash flows to the present value of the operating lease liabilities included in the consolidated balance sheet.

	Operating Leases
2020	$	104,573
2021		415,050
2022		405,443
2023		417,606
2024		430,134
2025 and thereafter		1,672,961
Total undiscounted cash flows		3,445,767
Less: interest		(1,331,375	)
Present value of lease liabilities	$	2,114,392

The Company entered into an office lease in January 2019. The lease commenced in June 2019, at which time the Company recognized the operating lease asset and liability. The Company pays a base monthly rent of $31,532 with payments increasing by 3% on each yearly anniversary of the commencement date. The initial lease term is for 9 years with the Company having a one-time option to extend for 5 years.

Below is a summary of undiscounted finance lease liabilities as of September 30, 2020. The table also includes a reconciliation of the future undiscounted cash flows to the present value of the finance lease liabilities included in the consolidated balance sheet.

	Finance Leases
2020	$	2,796
2021		11,184
2022		11,184
2023		9,699
2024		4,781
Total undiscounted cash flows		39,644
Less: interest		(8,306	)
Present value of lease liabilities	$	31,338

Leases (Details 1) - USD ($)	Sep. 30, 2020	Dec. 31, 2019
Assets
Operating Lease Asset	$ 1,706,695	$ 1,847,932
Finance Lease Asset	29,179	31,299
Total Lease Assets	1,735,874	1,879,231
Liabilities
Operating Lease Liability - current portion	152,063	22,088
Finance Lease Liability - current portion	7,458	5,638
Operating Lease Liability- net of current portion	1,962,329	2,040,576
Finance Lease Liability - net of current portion	23,880	26,608
Total Lease Liabilities	$ 2,145,730	$ 2,094,910

Summary of Significant Accounting Policies (Details) - USD ($)	Sep. 30, 2020	Dec. 31, 2019
Accounting Policies [Abstract]
Accounts receivable	$ 24,645,435	$ 18,249,273
Allowance for doubtful accounts	(16,790,115)	(9,976,941)
Accounts receivable, net	$ 7,855,320	$ 8,272,332

Promissory Notes-Related Parties

9 Months Ended

Sep. 30, 2020