DeFi applications are specific functions that exist in the world of finance which operate as standalone 'contracts' (programs) on a blockchain. These applications do specific things and you interact with them by initiating a transaction from your wallet to the contract. These can be anything from borrowing and lending, trading, sending money or even non-monetary things like escrow services, art and legal attestations. For the most part DeFi relates to only the monetary contracts, many of which have turn overs of hundreds of millions of $ in equivalent currency.