By default, an image stays within the safe area of a Popup. The image does not fill the rounded corners when you set a Border Radius.
To configure the image to fit the Popup edge to edge, enable the Ignore safe area toggle, reduce Padding, configure image spacing to occupy the corners of the popup. and then set the border radius.
The following GIF shows how you can configure the border radius for images to fit the Popup edge to edge:
For more information, see Create Pop-ups with New Templates.