When the Pay later toggle is on, whenever the user makes a card purchase they will be taking a fixed-rate loan for the purchase amount, which will be repaid in the number of installments that the user decides.
How does this work?
The cardholder initiates the transaction by making a purchase at a commerce or via e-commerce. Once the purchase is approved, a loan is issued for the total amount in USDC, which is then converted to the fiat currency used for the purchase and sent to the seller.
This is the first step; once it is completed, the user can enjoy their purchase.
Depending on the configurations previously set by the user, the debt payment will be made in one or more installments.
The debt payment usually begins up to four weeks after the purchase and will cover the total loan amount plus the associated interest if the purchase was made in one installment. If the users select more installments, they will repay a fraction of the total amount and interest, and every installment will have the same value.
The interest rates are fixed, and users can view them before making a purchase by accessing the app and using the simulator available on the card screen.