BNPL Pay is LIVE

The moment everyone has been waiting for is here. BNPL Pay is finally live and on mainnet (ETH). We are launching with the full feature set promised leading up to launch, with a slew of features slowly rolling out over the coming weeks.

Our launch begins with five active Banking Nodes, a number of issued loans, and a whole lot of staked BNPL in the Nodes. We are currently showing some very attractive APR numbers for stablecoin lenders.

Users can now:

- Deposit USDC/USDT to earn interest from loans + BNPL rewards

- Stake BNPL to earn BNPL from interest repayments

- Deploy their own Bank Node

- Request a Loan

Native BNPL staking is also live. Any active node can be staked in. APR numbers for BNPL staking will begin to appear as soon as the first set of monthly loan repayments roll in.

Many exciting things are happening over the coming weeks and months. We welcome everyone to come and try the platform and give us your feedback and ideas. We are always available on our Discord, Telegram, and Twitter.

The Rollout strategy

We have now been in the soft launch phase for approximately 2 weeks. Extensive testing has been performed on all aspects of the platform. Our standard procedure for implementing changes and updates is as follows: Deploy to the Testnet App on Kovan, throw every edge case we can at the test version, find bugs, fix, retest, deploy to the Mainnet app on Ethereum, and test again.

This has been the procedure for months leading up to deployment, and the results speak for themselves. The platform performs well, load times are fast, the transaction cost is relatively low and everything works as intended.

Our platform integrates a couple of novel features that are unique to BNPL Pay. These features require more thorough testing, and as such, we wanted to spend some time doing so in the soft launch phase also. The unique features are discussed in the two sections below.

Off-chain loan requests

We have an off-chain loan request function that allows users to submit loan requests without submitting a blockchain transaction. Requesting a loan is a 2 step process; Submit an off-chain request, that will look like this on your borrow page after completion:

Notice that in the top left corner there is a label [off-chain] which indicates the status of the loan process. Also notice, that there is an [Awaiting Approval] status that appears on the far right. Both of these serve to indicate that a) no gas has been paid and this is a ‘soft request’ for a loan and b) the banking node has not yet accepted your off-chain terms.

When the Banking Node approves your off-chain request, your status will change to this [Request Approved]:

Here you can see that the loan request is still in the off-chain phase, but it has been approved by the status indicated. This approval leads to the final part of the loan process, which is clicking the submit button on the far right. This executes an on-chain request, that requires you to pay gas.

When the Banking Node is ready to deploy the funds to your wallet, they will have the final review of your application and submit their on-chain approval. We have added a notification system to the platform, so you will see your borrow header show a bouncing number:

This indicates there is an action for you to take and or a new status is ready to be reviewed. When your loan has been deployed, the status will change once more and coins will be transferred to your wallet, and the loan contract will begin:

The active status indicates the loan is deployed and coins have been received. You can see a status summary, what kind of loan it is (interest-only / interest + principal) and when the next payment is due.

KYC

We have an integrated KYC solution (for nodes that choose to operate with KYC). The KYC provider is SumSub and we have an api implementation to help users onboard with them if necessary. Nodes that have KYC enabled will display visually with a [KYC] label as seen here:

Nodes without KYC will have no label, as seen here:

When a user tries to deposit either stablecoins or BNPL tokens into a KYC node, they will be presented with an onboarding screen from our partners at SumSub, integrated directly into the web app:

Platform Overview

The Lend section is where an overview of the Banking Nodes can be seen. We have a breakdown of some protocol statistics, as well as listing each individual Banking Nodes details.

BNPL Pay does not screen or whitelist Banking Nodes. A Node operating on our platform is not an endorsement of this node. Anyone who bonds a minimum of 2mm BNPL is able to run their own node. Please be very careful with your stablecoin and BNPL deposits into nodes, and do your own due diligence, as we do not take responsibility for the actions of nodes running on our protocol, nor do we vouch for the specific nodes on the platform.

The important elements to pay attention to when selecting a node to deposit are as follows:

1. Please pay attention to the labels that appear on top of the Node title. USDC/USDT nodes only deal in that specific stable coin. This means you can only borrow or lend in that coin type.
2. APR(s) is the expected rolling yield paid to users in this node. The top number indicates the APR paid on stablecoin deposits only. This number incorporates both the BNPL emissions as well as interest from borrowers repaying loans, paid in stablecoins. The bottom number indicates the APR for BNPL stakers in the node. Please note, that the bottom APR will only appear after the first successful loan repayment is made. Because BNPL stakers do not earn emissions, they only earn from borrower repayments. Stakers earn BNPL tokens that are market bought with the interest repayments.
3. The grace period indicates how long past the due date a borrower is able to repay their loan, without a slashing event being actionable . If a grace period is set to 30 days, that means the latest a borrower can repay a loan without penalty is the due date + grace period. This period is set by the Banking Node at the time of creation, and cannot be changed later.
4. Loan Utilization indicates how much of the liquidity is being actively lent out, and the cash balance refers to liquidity available for borrowing. Please note that all stablecoin deposits earn at minimum the base rate from AAVE supply side when not actively utilized in a loan (~1–3%), as well as BNPL emissions, which make up the majority of rewards early on. More info can be found in the whitepaper: https://bnplpay.io/file/BNPL%20Pay_Whitepaper.pdf
5. SATL ratio stands for Stake Asset to Liquidity ratio. This indicates how much BNPL (either staked or bonded) is present in the node compared to how much stablecoins are in the pool and at risk of default or loss. The higher the SATL ratio, the higher the ‘backing’ of the node from default. This acts as an unofficial insurance fund, although that is not the most accurate way to describe it due to the associated variables that can impact slashing. While slashing is a consequence of defaulted loans, BNPL that is transferred to lenders who have lost out, does not guarantee equivalent $ value of the lost funds, nor does it take into consideration real-world factors like slippage and liquidity in the DEX. Info is available in our whitepaper: https://bnplpay.io/file/BNPL%20Pay_Whitepaper.pdf
6. By default, only active nodes are shown in the display. If you wish to see underbonded (nodes that have less than 2mm BNPL due to either slashing or other conditions), please click the “Show Inactive” tickbox in the top right corner. You will then see a larger list of nodes that includes inactive nodes:
7. You are able to deposit stablecoins or BNPL into any Node directly from this screen. When you click Deposit or Stake, you will be presented with a box to enter how much you wish to deposit/stake, and then several transactions will occur, so expect your metamask or wallet to prompt you multiple times.

Requesting a loan

Requesting a loan is very easy. Being approved for a loan may not be. The platform deals with a very difficult concept in lending, that presents the highest risk to lenders; uncollateralized risk. It is in the interest of every Banking Node to do proper due diligence on borrowers, and it is understandable that the rejection rate may be high to protect the lender capital and BNPL tokens from a slashing event. It doesn’t cost anything to request an off-chain loan, and it will help your chances greatly if you are a known entity or have sufficient proof required by the Banking Node to grant you a loan.

The setup for borrowing on BNPL Pay is borrower centric. This means that the borrower has the negotiating power in dictating terms for the loan. When you press the borrow section and create a loan you are presented with a number of important choices:

1. Chose your stablecoin type. Pressing either choice will present you a modified list of Banking Nodes in the [Bank Node] drop down that filters only for that stablecoin type.
2. Chose your repayment type. You can have Principle and Interest only repayments, which means your loan will be broken up evenly into the number of months you chose, and each month you will repay both the principal and interest portion until the loan is fully repaid. The interest-only option will allow you to pay interest only every month until the final month, where the balloon (the principal) and the final interest payments are due.
3. Amount, APR, Term: Use the sliders to see how your loan will look under various conditions and choose what's appropriate for you.
4. The origination fee is the commission paid for establishing a loan. It is broken up into 0.25% for BNPL Pay and 0.25% for either the Banking Node or a Broker who referred the loan. The Total Loan receivable is the net amount you will receive post fees.
5. Fill in the remainder of the details with the most relevant and in-depth information necessary.
6. If you have supporting documents of a sensitive or private nature, please attach a URL (dropbox, drive, etc) and the web app will encrypt the link with the public key of the Banking Node so only the Node Operator has access to this information

After you have completed your request, press confirm. Your loan enters a request status where the Banking Node will review your information and either accept or reject your terms. As mentioned earlier, the first round of approvals is off-chain only. After your first request is approved, you are required to submit the request on-chain:

After the Banking Node approves your request on-chain, the loan will be issued to your wallet, and the loan contract will be executed.

You can manage your loan applications, and repayments and view the status of current and past loans on the borrow screen. The loan management screen looks like this:

Please pay attention to the [Next Payment] date and the status of your loan submissions if they haven't yet been approved, or require further steps.

Bank Node Screen

This is a shared screen for every user. There is useful information about the performance of the Node, the loans lent out, the number of stakers, and more in-depth info about both slashing as well as donations by the node.

There are various pieces of information here. A lot of it is fairly self-explanatory, but we will highlight the less obvious bits.

1. Pool details; Total Pool Value is all the stablecoins deposited into the Node. Current Cash Balance — liquidity available for loans right now.
2. Slashing Balance — In the event of a default that leads to Slashing, the balance of BNPL tokens to be disbursed to lenders appears here. Anyone is able to press the Sell button to convert the BNPL to Stablecoins that are deposited back into the lending pool to compensate for partial or full capital loss as a result of the default.
3. Pending Staker/Operator fee — These are the fees that accrue for the Banking Node operator (10% of interest repayments) and BNPL Tokens for Stakers (20% of interest repayments). Pressing this button will initiate the distribution of funds to relevant parties. Anyone can press this button at any time.
4. Your Pool Tokens (stablecoin investment) — When you deposit USDT or USDC into a Banking Node, your wallet is credited with pool tokens that represent your equity in the Pool. As the pool earns interest and changes in proportion, the exchange rate of your pool tokens to USDC/USDT will change. In a positive environment when interest is being earned and no defaults occur, the exchange rate for each pool token will go up (ie it starts as 1 pUSD = 1 USDC/USDT and then becomes for example 1 pUSD = 1.07 USDC/USDT). In a negative environment, if slashing or capital loss has occurred, this ratio may drop and you will redeem less than 1 pUSD: 1 USDC/USDT.

1. When you deposit BNPL tokens, your tokens begin earning 20% of interest repayments from the moment the first repayment by any loan in the node is made. If you try to withdraw your BNPL tokens, a 7-day cooldown timer is triggered. During this 7-day period, your BNPL will not earn any rewards, and you will only be able to withdraw your unstaked tokens at the end of this period.
2. Active loans — This shows all current loans issued by the node. All the details about the loan can be seen here. From this screen, any user is able to repay the next payment or the full loan. Any user is also able to call the slashing function in the case that a loan is overdue (and the grace period has expired).
3. Inactive loans — these are all completed loans until this point. A completed loan is considered a loan that has either been repaid or slashed.
4. Bank Node operators have additional sections not visible to external users:

1. The Donate section is an entirely optional operation that a Banking Node can perform at any time. It is designed as a measure of goodwill from the Node Operator in the instance of a defaulted loan. Lenders that have lost money and remain in the pool could be compensated by the Operator donating either Stable Coins or BNPL tokens directly into the pool affected by the default/loss
2. Pending Loan Issuance is the section for managing loan requests and issuing loans to borrowers. More in-depth information about the borrower and the loan is available to the Bank node operator by pressing the icon left of the borrower address:

Closing Thoughts

There are a lot of exciting things happening behind the scenes. We are in talks with a lot of prominent companies both from the DeFi space and the Traditional Finance space. We are onboarding new Bank Nodes, we are building our marketing campaign, we are expanding the team and we are working on new and enhanced features.

In the next few months, you will be seeing a lot more buzz in the media about BNPL Pay. You will see more nodes with more diverse mandates, you will see more users, more community, and an evolving product that is being forged tirelessly by the product team.

BNPL Pay has had a troubled start, with delays, development hell, and turbulent market conditions. To get here has been a long and arduous journey. But now that we are here, everything is in place for the vision we have for BNPL Pay to become the cornerstone of uncollateralized lending and the de facto bridge between TradFi and DeFi capital.

This is just the beginning for us, we have big dreams and would love to take our entire community with us along for the ride.

What is BNPL Pay

BNPL Pay is a decentralized blockchain lending protocol that is putting credit in the hands of those who need it the most: people without capital. The BNPL Pay Protocol addresses the issues that are presented by uncollateralized borrowing, with a decentralized network of banking nodes. With the BNPL Pay Protocol, anyone can become a bank and anyone can apply for a loan.
BNPL is the governance token at the heart of the protocol.

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