Polkadot Community Foundation: Polkadot Payment Card

Proponent: Autonomous Projects (16MVQPFt325pJ74bYpCGUWjyANFDZFZP3efYyV6XReAd1Sq1)

Top Line

This proposal seeks to ratify the alignment from the Polkadot community to launch a “Polkadot” branded payment card for our ecosystem.

The card will be a non custodial payment card and will be able to be issued globally, and work anywhere in the world Visa is accepted.

The card will work with Apple Pay and Google Pay from day one and cost no fees to hold or fund the card other than gas. Users will pay a small usage fee (under 1%) when making transactions.

There is no cost to the Polkadot Treasury for the origination, set up and integration of this card program. All integration work in the Polkadot App will be covered by Ref #1573.

The launch of the payment card is subject to contractual and legal review.

Details

The Polkadot payment card will offer a seamless way to bridge the gap between digital assets in the Polkadot ecosystem and everyday spending. This payment card will greatly improve the offramping experience and increase the useability of the Polkadot ecosystem for payments and DEFI.

The Polkadot payment card also will provide users with greater financial flexibility and control over their money. As the Polkadot App builds out its feature set over the next 6 months, by adding the payment card, we see the functionality providing an alternative to traditional banking, especially for individuals already receiving an income in stablecoins.

The two main considerations for the payment card are:

• A non custodial payment card - users should never have to lose custody for basic spending
• Global issuance - almost anyone in the world should be able to register for the card inside their wallet or application.

After detailed research and due diligence spanning over several months, the PCF has selected Baanx as the card provider and issuer as they can offer an excellent experience with a non custodial card, and have global issuance. Baanx has very successfully launched cards for Metamask, Ledger, 1inch and World. They are very connected with Visa and Mastercard teams and are principal members of both the Visa and Mastercard programs through their parent company.

This payment card program would be managed by CL, a brand of Baanx. The Polkadot Community Foundation (PCF) will refer users to CL through the Polkadot Mobile App (https://polkadot.com/app), and will drive the initial integration, adoption and usage of the payment card.

This proposal seeks to gain community support for the following:

• The Polkadot Community Foundation to work with Baanx to set up and manage a payment card program
• Negotiating and signing any contractuals with Baanx or other companies required to launch the payment card
• Co-ordination of any marketing or incentives programs to increase visibility of Polkadot and / or the card program.

Card Program

The payment card will be a debit card, using the Visa rails and will be Polkadot x Visa branded. The card will carry no other branding.

The card will be powered by solidity smart contracts using account abstraction and will allow users to hold and pay with USDC which is pre-authorised for spending using account abstraction. Other supported assets are planned to be added in the future.

The vast majority of other crypto payment cards on the market are custodial cards, meaning you have to “top up” your account which moves funds out of your wallet / your control, this massively increases the risk of loss of funds.

The payment card will allow payments made at any location that Visa is accepted, where the user pays a small fee (between 0.4% and 0.8% of the value of the transaction) for the payment. This fee will be country and currency dependent and is driven by Baanx. This covers all Baanx and Visa costs including the crypto to fiat offramping and merchant reconciliation. Any remaining funds left over after costs will be split 50/50 between the PCF and Baanx.

The user pays no monthly account fees, minimum fees or any other fees associated with having or managing the card. There is no fee (other than a gas fee) to approve the spending of funds for the card.

The card program will launch with a virtual payment card which works fully with Apple Pay or Google pay and in the future.

The payment card issued by CL via Baanx is a regulated product and subject to jurisdictional approval and standard OFAC Regulations globally. Each user who wishes to order a card will request it via an onboarding flow including industry standard KYC and AML review prior to issuance in their country of citizenship. Approval requirements vary by geography.

DAO Costs

There will be no cost to the Polkadot Treasury for the origination and setup of this card program. As per the relationship between Baanx and the PCF, there will also be no long term or ongoing maintenance cost. Baanx will be the ongoing and exclusive provider for the contract term (3 years).
Any ongoing relationship management costs are built into funding provided for Autonomous Projects managing the PCF.
Once launched the PCF may seek treasury funds for promoting the card program or offering incentives, for example: further cashback on the payment card, subsidising payment fees, or paying physical card costs.

Roadmap

Assuming the governance proposal is a success then the PCF and Baanx will work through the following items:

• Baanx has already provided the PCF with a letter of intent to proceed with the commercial contract
• Baanx and PCF to finalise the full contract within one month of signing the letter of intent
• Baanx to deploy their smart contracts to a Polkadot testnet
• The Polkadot Community Foundation will integrate the registration and card management flows
• End to end testing
• Production deployment and further testing
• Launch ✨

We believe that upon the governance proposal passing community voting, we will be able to launch the card for the first round of VIP users in 6-12 weeks.

Full public launch will take place in the coming weeks afterwards, assuming there are no issues or delays with the deployment.

The card launch is also great timing to expand the Polkadot App from being USA only to covering other countries like the United Kingdom and Europe more broadly.