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High-performance Schottky diodes based on palladium blocking contacts were fabricated upon depositing indium-gallium-zinc oxide (IGZO) with high oxygen content. We find that an oxygen treatment of the palladium contact is needed to achieve low off currents in the Schottky diode, and rationalize this by relating an increased oxygen content at the Pd/IGZO interface to a lower interfacial trap density. Optimized IGZO films were obtained with a record high ratio of free charge carrier density to subgap traps. The rectification ratios of diodes with such films are higher than 107 with current densities exceeding 103 A/cm2 at low forward bias of 2 V.