Zip Co shares are enjoying their best day of an already stellar year after the company became the first buy now, pay later service to partner with Amazon in Australia.
The service was live on Amazon Australia on Thursday in a move the ASX-listed firm, which counts Afterpay among its rivals in the crowded buy now, pay later sector, said puts it "firmly on the main stage".
"We are thrilled to have secured this strategic agreement with Amazon Australia, providing customers with a more flexible way to pay," Zip chief executive and managing director Larry Diamond said.
"This agreement puts Zip firmly on the main stage by allowing customers shopping on Amazon.com.au to use Zip to pay at their pace."
Shares in Zip surged as much as 24.1 per cent on the news and were still 17.4 per cent higher at 1148 AEDT, putting them on course to beat 2019's previous daily best of 16.5 per cent on April 29.
Zip, which allows customers to pay for items in interest-free instalments, said an Amazon affiliate will receive warrants for 14.6 million Zip shares as part of the deal.
The affiliate will have the option to buy the shares priced at $4.70 within seven years.
Zip shares were worth $4.04 at 1148 AEDT, 31 per cent down on last month's all-time high $5.86 but still up from $1.09 at the start of 2019.