The ASX-listed shares of domestic credit card disruptor, Zip Co, rallied strongly on Wednesday after the company revealed its transaction volumes exceeded A$1 billion  in the 12 months to the end of June.The buy now - pay later specialist posted its best ever quarter in the June 2019 period, generating more than $351 million in receivables activity.This equates to a doubling of the transaction volumes recorded in the same period last year.Zip's rapid growth has stoked expectations among investors that the company might deliver a bottom line surprise when it reports its full-year results next month.The share price closed up 9 per cent on Wednesday to $3.47 on higher than average turnover.In the last 12 months the market value of Zip scrip has quadrupled.Managing director Larry Diamond said he was pleased with the record volumes and surge in customer numbers, which grew by 80 per cent over the year to 1.3 million.He cited the expansion of Zip's merchant network as one of the key growth drivers during the year."We signed a number of strategic payments partnership with Tyro and Adyen, as well as continued to onboard well-known enterprise clients to the platform - Just Group and Kmart Australia being the standouts," he said."We finished the 2019 with a strong end of financial year, having achieved all financial targets set at the beginning of the year."As a credit card disruptor, we continue to see large numbers of customers adopt the Zip interest free digital wallet as we strive to be the first payment choice everywhere and every day."Funding a rapidly expanding finance business has emerged as one of the big challenges for the company in the last year.At the end of June Zip had access to $731.5 million worth of facilities, of which $587 million was drawn. The company has mandated National Australia Bank to begin marketing a new securitisation program that Diamond says will deliver cheaper funding for the group.The new program will be known as the Zip Master Trust and an issuance is expected in the December quarter depending on market conditions.Zip now has direct distribution arrangements in place with 16,200 merchants across the country - up more than 8000 over the year.The Tyro deal is strategically significant because it will provide a direct gateway for Zip's products to be distributed through another 20,000 merchant terminals.One of the most encouraging performance indicators in the business has been the consistent improvement in bad debt experience.Bad debt charges as a percentage of gross receivables have fallen from 2.61 per cent in the June quarter 2018 to 1.63 per cent in the latest three-month reporting period.This performance metric is likely to increase in importance in the buy now- pay later sector as new competitors such as Visa Inc enter the Australian market.Visa's entry could usher in a period of margin contraction that will put the investment spotlight on cost control.The consensus earnings forecasts of broking analysts suggest Zip will generate its maiden bottom line profit in 2020.