Buy now pay later company Sezzle cut its merchant numbers by 10 per cent and its customer numbers by 13 per cent last year in a shift from growth at all costs to a focus on profitable business. Sezzle said it “offboarded” 5,000 merchants, cutting the number by 10.4 per cent to 42,000. The closure of businesses in India, Europe and Brazil accounted for 1,000 of the cuts. It offboarded 450,000 customers, cutting the number of active customers by 13.3 per cent to 2.9 million, largely as a result of tighter underwriting. One benefit of this was a reduction in the provision for uncollectible accounts from US$52.6 million in 2021 to US$29.4 million last year. Personnel costs were cut 9.9 per cent to US$51.2 million. Technology and marketing costs were up. A big cost increase was interest, which rose 63.2 per cent to US$8.6 million. Sezzle is paying a margin of more than 11 per cent over benchmark for funding. With all the offboarding, underlying merchant sales fell 3.6 per cent to $1.7 billion. But thanks to increased merchant processing and third-party fees, income rose 9.7 per cent to US$125.6 million. In an effort to boost revenue, Sezzle introduced a premium service, offering customers access to “premium merchants” and reward points for a monthly fee. The loss for the year was US$38.1 million, compared with $75.2 million in 2021. The bottom line was helped along by an US$11 million break fee paid by Zip Co, after it cancelled merger plans. One interesting disclosure in the financial report is that the top 10 per cent of Sezzle’s customers, measured by sales, transact an average of 41 times a year. They are treating their BNPL accounts almost like debit accounts.