The news: Mastercard and LoanPro launched Loan on Card, a personal loan service for consumers and small businesses delivered through virtual and physical cards, per a press release.
Borrowers will receive instant access to fixed-term installment loans that can be used anywhere Mastercard is accepted. Loan on Card will be powered through Mastercard Installments Credential, and funds will be deposited into a mobile wallet.
The feature will roll out in 2026.
Why this matters: Banks have relied upon ACH transfers to facilitate personal loans, which can frustrate consumers as they wait first for approval and then for funds to actually hit their accounts. With Loan on Card, issuers can disburse instantaneously for use online or in-store.
These card-linked personal loans also help issuers avoid losing consumers to buy now, pay later (BNPL) providers to cover larger purchases.
Our take: Loan on Card provides a patch for issuers trying to retain customers that otherwise would have fled to BNPL platforms for larger loans to avoid revolving debt on credit card transactions they couldn’t pay off within a month.
BNPL platforms can still boast direct connections at the point-of-sale (rather than leaving checkout to apply for a loan in your bank app or online) and the fact that even longer-term BNPL loans don’t appear on customers’ credit scores.
Banks need to make sure their loans are just as accessible when consumers are shopping for bigger purchases—not just with real-time funding but also real-time underwriting. They can also consider incentives like Affirm’s 0% interest days or PayPal’s 5% back on installment transactions during Cyber Five.