Merge fields provide the ability to pre-populate data into a form prior to sending it out for completion.
Merge fields can be added to Text Inputs and Paragraph components on the builder. Please see screenshots below:
For paragraph components use the Merge fields option:
For Text Inputs use the Pre-Fill option:
For adding new merge fields click on "+Add or edit merge fields" and you should see the following screen where you can add/edit merge fields: