6. Advances Receivable, net

During our fiscal year 2019 we entered into arrangements with a select group of MCA originators to participate in MCA funding activity. We made an initial advance of $5,000,000 to the originators, which in turn advanced these funds to merchants as part of a syndication. Subsequent to our initial investment, we have made additional advances to these originators, and as receipts have been paid to us by the merchants, we have used the collected funds to fund additional MCAs through these originators.

Changes in the allowance for MCA credit losses are as follows (amounts in thousands):



Allowance for credit losses, July 1, 2018	$	—
Provision for credit losses		1,605
Receivables charged off		(869)
Recoveries of receivables previously charged off		—
Allowance for credit losses, June 30, 2019	$	736

During the fiscal year ended June 30, 2019, we provided $4,750,000 of cash advances to an aviation business to fund the deposit required for the recipient’s aircraft purchases for up to six months, in exchange for paying us an upfront fee and a guaranty of the full repayment obligation from the principal of the third-party business. These prepaid fees are netted against the principal balance, earned over the six-month advance period, and are reported as part of MCA income within the statement of operations. Each quarter, we review the carrying value of this cash advance, and determine if an impairment reserve is necessary. As of June 30, 2019, $2,000,000 of these advances had been repaid. The remaining $2,750,000 had not yet become due for repayment as of June 30, 2019, and management believes this remaining amount is fully collectible.

Total advances receivable, net consisted of the following:


					Provision
	Advance		Deferred		for Credit		Carrying
	Principal		Fees		Losses		Value
	(Amounts in thousands)

Merchant cash advances	$	7,434	$	—	$	(736)	$	6,698
Aviation advance		2,750		(59)		—		2,691
Advances receivable, net	$	10,184	$	(59)	$	(736)	$	9,389

As of June 30, 2019, 97% of merchant cash advances were originated through a single MCA funder.