Sezzle’s earnings are driven by low-quality loans and the buy now, pay later provider’s provisions for bad debts grew at 22 times the rate of its total loan book, according to activist investor Hindenburg Research.

In a detailed report issued this week, the New York-based short-seller has accused the high-profile payments business of appointing a head of risk with “no apparent prior corporate experience”, describing him as a teaching specialist at the University of Minnesota.