So it’s a small segment of the portfolio. So we’ve been focused on credit tightening, reducing payment terms, getting paid more often and better adjudication of new customers coming in to control those credit losses. We expect to see the benefits of that over that — over the course of the year. But on the other side of that is we do see a slowing economic environment in the back half of the year. And so, we’ve factored in some impact to credit losses. So that’s where you see the puts and takes in our guide.
Operator: Next, we’ll go to Trevor Williams with Jefferies. Your line is now open.
Trevor Williams: Great. Thanks. Good morning. Yes, I wanted to ask on margins in the fleet segment. Obviously, there’s some moving pieces there just with fuel prices and the provision, but just thinking if we back out the impact of the provision in 2023, how you’re thinking about decremental margins in that segment with the puts and takes of lower fuel, but then some offset from the cost savings? Just any help there would be great. Thanks.
Jagtar Narula: Yes. I would say there’s two primary things that we’ve been looking at with — related to the fleet margins. So one is the lower fuel prices that we expect next year. Then on top of that will also be higher operating interest that we expect. As interest rates rise, that impacts fuel margins. So both of those we expect to bring margins down in the fuel segment and as you mentioned, the higher credit and fraud losses as well.
Trevor Williams: Okay. Got it. Thanks. And then for health, within the — I think you said 25% to 30% growth for the segment for 2023. Any way you can parse out what you have embedded in that number for the interest income on the custodial assets?
Jagtar Narula: Yes, we’re expecting that to be roughly 50% to 60% of the growth next year. When you look at it, we ended the year with about $3.5 billion of custodial assets that we’re investing. And if you factor in kind of normal growth in that, some SaaS account growth, combined with higher interest rates that we’re investing those assets in into this year, we see about half the growth coming from the nonbank custodial business.
Operator: Next, we’ll go to Bob Napoli with William Blair. Your line is now open.
Bob Napoli: Thank you. Good morning. Nice results. Question on — you said you added about 100,000 customers in 2022, mainly SMBs. Just thoughts around the SMB environment, and there’s some slowing in, like the smaller truckers. But what are you seeing in SMB broadly? And is any of this related to Flume, and some others are seeing deceleration in the SMB. Doesn’t sound like you’ve seen that outside of trucking.
Melissa Smith: Bob, good morning. We have not seen a deceleration in the small business marketplace and there continue to be strength within our customer segment and certainly within the additions we’ve had to our portfolio. And we talked about 100,000 new customers that we’ve added. In total, we added 4% net growth and really strong growth across each of the portfolio. So really geared towards smaller businesses, like Freda, we added new business across each of our segments. And equally, actually, equally small across the segments with the exception of our corporate payments and travel segment. That tends to be geared towards mid-market and larger accounts. But if you look at both our health and our fleet segment, we’re adding both large customers but also a pretty large concentration of smaller businesses.
