Visa just quietly built one of the most successful lending operations in crypto, and almost nobody noticed. The payments giant’s collaboration with Credit Coop has produced an onchain lending model that has financed over $2.5 billion in cumulative settlement volume since 2023, processing more than 3,000 borrowing events and 9,000 repayment events. The kicker: zero defaults across all of it.
How the plumbing actually works
The model integrates VisaNet’s settlement data with blockchain-based smart contracts to create revolving credit facilities for fintechs and stablecoin-linked card programs. At the center of the system sits Credit Coop’s “Spigot” smart contract. It functions as a programmable lockbox, automatically routing repayments and securing collateral directly from settlement receivables. When a fintech card issuer needs funding to cover Visa settlements, the smart contract handles the mechanics: disbursing funds, tracking collateral, and collecting repayments without human intervention at each step.
The result is faster settlement cycles and, according to the project’s data, borrowing costs that have dropped by as much as 30% for participating programs. That reduction comes from two sources: increased lender participation drawn by the transparency of onchain data, and the operational efficiency of removing middlemen from the process.
Rain, a Visa Principal Member, has been the largest user of the facility since Credit Coop went live in August 2023. Rain alone accounts for roughly $2 billion of the total volume, making it the anchor tenant of what is essentially a new category of financial infrastructure.
Visa’s stablecoin empire is getting serious
The company now has more than 160 live stablecoin-linked card programs operating on its network worldwide. Stablecoin settlement volumes on Visa’s network have reached a $20 billion annualized run rate, representing an increase of more than 15 times compared to the previous year. Payment volumes across these programs have climbed nearly 200% year-over-year.
Why the zero-default record matters more than you think
The Spigot smart contract secures repayment at the source by intercepting settlement receivables before they reach the borrower. Lenders aren’t hoping to get paid back. The code ensures it happens automatically from incoming cash flows.
The just-in-time funding model that Visa and Credit Coop are exploring takes this further. Rather than extending large credit lines that sit partially unused, the system can provide capital precisely when settlement obligations arise, reducing the amount of idle capital in the system and potentially lowering costs even more.