Buy now, pay later group Zip had record earning in March as the market for credit looks to benefit from a tightening of conditions in the market.

The credit provider upgraded earnings guidance following the strong March quarter, with retailers telling ChannelNews that thy are seeing more credit purchases.

FY26 group cash earnings before taxes, depreciation and amortisation (EBTDA) is forecast at around $260m, compared to earlier forecasts of $249m.
The forecasts follow record cash earnings of $65.1m in the March quarter, up 42 per cent versus the prior corresponding period, as group TTV grew to $4bn, up 22 per cent.

Total income increased 20% to $335.2m, on the downside revenue margins slipped 8.4% from 8.6%.

Zip had previously forecast second half EBTDA being broadly in line with first-half EBTDA of $124.3m.

Net bad debt were reported at 1.9% which were described as being were “in line with management targets.

The group had 6.5 million active customers at the end of March which is up 3.5%

Zip Group chief executive Cynthia Scott said the business was continuing to “drive increased profitability at scale”.

“Momentum continued across both their Australian and US markets underpinned by deepened customer engagement and disciplined execution.”