Afterpay has added 12 per cent to its already soaring share price thanks to record December sales, but the Australian-based company is also defending its risk to consumers ahead of an appearance at an inquiry into buy-now-pay-later vendors.

While Afterpay’s innovative payment platform has seen its customer base surge in 2018 – including to one in four Australian millenials – the company said on Friday its business models also a reason for leniency at the Senate Inquiry into Credit and Financial Services, which holds its next public hearing in Brisbane on Tuesday January 22.

Afterpay had previously backed the proposed Australian Securities and Investments Commission approach to have product intervention powers extended to the burgeoning buy-now-pay-later industry.

This sector has saddled shoppers with nearly $1 billion in debt in 2017/18 and the likes of Afterpay and zipPay increasingly shaping the spending habits of younger consumers.

But Afterpay said its business model and in-built customer protections set it apart from other vendors.

‘Afterpay believes regulation should be proportionate to the protections and lower risk profiles associated with certain products, and that it should recognise and facilitate new business models and real-time decision making driven by innovative technology,’ the company said in its trading update on Friday.

‘We have spent considerable time talking directly with government, regulators, consumer advocacy groups, customers, merchants and shareholders about Afterpay and how it is different to traditional credit products.’

Like other similar businesses, Afterpay allows consumers to buy an item immediately with a smaller up-front payment, and then pay the rest via intervals thereafter.

A late fee applies to missed payments, while Afterpay also charges retailers a percentage of each transaction.

The company, which launched in Australia in mid-2015, was one of the best performers on the ASX in 2018, its share price more than doubling to $12.40 by the end of the year, though it cooled from an historic high of $21.13 in August.

On Friday Afterpay shares rose another 12.21 per cent to $15.98 at 1333 AEDT, after earlier announcing worldwide underlying sales in the six months to December 31 had exceeded $A2.2 billion, up from $918 million during the same period in 2017.

This success was mainly driven by the company’s expanding US footprint, which processed $260 million in underlying sales in the six months to December 31, as well as welcoming 650,000 new US customers and 1,400 new retailers.

Half-year sales also surged in Australia and New Zealand thanks to a strong holiday season, with in-store transactions jumping more than four-fold to represent 16 per cent of total trans-Tasman sales.

The company said it had interacted with 2.5 million Australian and New Zealand customers and 21,500 retailers during the past 12 months.

New Australian in-store merchants include Nike, Lululemon, JAG, Officeworks, and Fantastic Furniture, while Sydney’s Luna Park was added to the entertainment vertical alongside Village Roadshow.

In health, Bupa Optical and OPSM have entered agreements to rollout Afterpay in-store across Australia.

Australian and New Zealand late fees have also dropped, and at the half-year comprised 20 per cent of total sales as opposed to 25 per cent in the 2017-18 year.