Borrowers in the U.S. can now get funds with a DeFi-powered Visa card by Swipe.
Swipe, a Binance-owned cryptocurrency debit card provider, is expanding its offering with a new crypto Visa card that allows users to borrow funds using blockchain technology.
Dubbed the “LendFi Visa Card,” the new product deploys major decentralized finance protocols to provide “near-instant access to lending balances.” The card is integrated with the LendFi app — a decentralized lending platform that is connected with the borrower through their mobile device. At launch, the platform will support major DeFi protocol Compound, a spokesperson for Swipe said.
According to an announcement, 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 via their card.
Swipe developed the card with California-based payments company Marqeta. Marqeta vice president of business development Salman Syed 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.”
Virtually-issued LendFi Visa Cards are available for borrowers in the U.S. 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 4% cashback on all purchases.
Cryptocurrency lending is one of the most important use cases for the DeFi industry. In contrast to traditional finance, 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. Still, decentralized lending is associated with certain risks as it is still not 100% secure.