Hello!
could you tell when the interaction is supposed to happen?
Whenever the player nears it / overlaps it’s collision field ie, “when the player approaches the NPC” as you said.
and when the player moves away, the widget disappears
Yep 
are you using widget components for this?
Yes.
and what is the setup - each actor has its own widget, right?
Each Actor has their own Widget Component.
Hopefully I can post more screenshots in the Comment section.
w
I didn’t wanna do binding text because I heard it’s not good for performance. Yet I see so many people try this so I avoid it. I’m stuck because I don’t wanna move forward with this until I am certain of this.