It has been reported that the new product deploys major decentralized finance protocols to provide “near-instant access to lending balances.”
However, the card is integrated with the LendFi app, a decentralized lending platform that is connected with the borrower through their mobile device.
A spokesperson for Swipe said that the platform will support major DeFi protocol Compound at launch.
Swipe is thrilled to announce it has partnered with Marqeta, a payments unicorn, to launch @LendFi, an instant Virtual #Visa card in the 🇺🇸 that can be immediately tokenized and linked to #Apple Pay & #Google Pay built for real time #DeFi lending access powered by #Swipe Issuing pic.twitter.com/oemtRLyxw7 — Swipe (@SwipeWallet) September 30, 2020
The report said that the new blockchain-based lending platform approves loans for users and disburses them to accounts. The LendFi App also offers a stablecoin aggregator so users can deposit various stablecoins to spend through their cards.
Swipe developed the card with California-based payments company Marqeta.
Salman Syed, the Vice President of Business Development at Marqeta, said that the card enables lenders to issue a loan directly onto a card, which extends the company’s efforts to “remake the lender-borrower relationship.”
Likewise, virtually-issued LendFi Visa Cards are available for borrowers in the US by downloading the LendFi app, signing up, and completing identification procedures. After applying for a LendFi Visa Card virtually, users can order a physical card. The card will also offer a 4% cashback on all purchases.
Cryptocurrency lending is one of the most important use-cases for the DeFi industry.
Thus, DeFi lending does not need a central party or a middleman to approve and distribute loans, as DeFi loans are issued through a distributed system and decentralized applications.