Iron-on appliques´ have exposed raw edges, and over time they will lift slightly and unravel unless the edge is sewn in some manner. My favorite method is to cover the edges with a zigzag stitch sewn with monofilament (clear) thread. Alternatively you could use almost any decorative machine stitch with any colored thread or even a hand embroidered blanket stitch.
Because it's clear, monofilament thread doesn't detract from colors and design elements. If you're not familiar with monofilament thread, it is like thin fishing line. I use it for the top thread and in the bobbin. I have never had any tension problems but I know for some they have occurred. The monofilament spool is large and needs to be on a cone thread holder (see photo A)
The netting covering the spool keeps the thread from tangling. Thread your machine as you normally would.
Photo A
Photo B
Photo C