What’s the catch with lending shares?

So I’ve heard about institutions lending shares before (for the purpose of shorting, for example), but I’ve never seen it offered on a brokerage account.

I have a robinhood account with a few hundred bucks that I mess around with, and just noticed they’re offering 1.5% annually to lend your stocks.

I don’t trust Robinhood to explain it properly, so what’s the catch? Do you just lose liquidity?