By PYMNTS | October 16, 2026
Highlights
Cross-border payments providers often position money before payouts occur, leaving cash committed until transactions and settlement draw it down.
Stablecoin funding could let providers replenish those positions outside banking hours and closer to the time payments are made.
Any working capital gain depends on whether providers can actually maintain smaller prefunded balances, not simply substitute stablecoins for fiat.
Cross-border payments carry a working capital cost before money reaches the recipient.
Payment providers frequently need funds available in advance to make payouts in other markets. For a company operating across currencies and time zones, that can mean maintaining cash in multiple bank, settlement or network accounts so payments can proceed when customers send them.
Stablecoins are gaining a role in the process, as 24/7 funding can reduce the amount of cash providers must position in advance and the length of time it remains committed.
Finance departments are already putting more attention on cash availability. The September PYMNTS Intelligence Working Capital Index found that the index for North American middle-market firms fell 6% to 51.6 in 2026, its first decline in four editions. Firms received 12% of customer payments early, down from 35% a year earlier, while 83% used a working capital solution, the highest share recorded in the series.
Additionally, PYMNTS Intelligence’s October Time to Cash study found that 87% of chief financial officers surveyed improved their overall cash flow cycle, while 80% shortened their cash conversion cycle by a net 3.7 days.
Why Prefunding Ties Up Cash
Prefunding means ensuring money is available before payments or settlement obligations come due, according to the Bank for International Settlements. A bank, money transmitter or payment company making payouts in another market may maintain balances with a bank, payment network or local partner, depending on how its service is structured.
The provider draws against these balances as payments are made and replenishes them as necessary. The amount it keeps available can reflect transaction volumes, currencies, settlement schedules, credit arrangements and the hours during which conventional banking systems can move additional funds.
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Timing can increase the balance required. A provider that cannot readily replenish an account overnight, over a weekend or during a holiday may need to fund anticipated payments earlier. Cash held for that purpose is available for payments, but it cannot simultaneously be used elsewhere by the company.
Stablecoins offer a way to move funding outside some of those conventional banking windows.
Visa announced Thursday (Oct. 15) that Visa Direct moved stablecoin prefunding from pilot to commercial production. Inyo Global, a payments infrastructure provider and Visa Direct processor, is the first enabler. Eligible businesses using its platform can prefund Visa Direct cross-border payouts with USDC in near real time, while recipients can continue to receive fiat currency. The stablecoin is being used behind the payment rather than necessarily becoming the currency used by the sender or recipient. Visa receives stablecoin funding and credits the client’s funding balance, allowing the existing Visa Direct payout process to continue.
Another test examined stablecoins at a different point in the funding chain. Lloyds Banking Group used USDC during a seven-day pilot to settle $750,000 of payment obligations with Visa, including transactions completed over a weekend, PYMNTS reported in September.
Lloyds bought USDC through regulated digital asset exchange Archax and transferred the stablecoins to Visa in the United States, per a Sept. 30 press release.
The larger backdrop for stablecoins is that if a provider normally funds an account far enough in advance to cover transactions through a weekend or banking cutoff, the ability to replenish that account around the clock could allow it to fund closer to actual demand. A provider could, in principle, keep less cash in the account between replenishments.
Stablecoin prefunding does not remove the need for liquidity. Providers still need enough assets available to meet payout obligations, and stablecoins introduce their own costs and requirements, including acquisition, redemption, custody, compliance, foreign exchange and operational processes.
Additionally, the economics are not uniform. A corridor where a provider must position substantial cash before weekends or local banking cutoffs presents a different calculation from one where fiat funding can already be moved quickly and cheaply.
The relevant comparison is consequently not stablecoins against existing payment rails. It is the amount and duration of the liquidity commitment under each funding method. The role of stablecoins in working capital is now moving from theory into payment operations, including whether continuous funding changes how much liquidity must be committed before a cross-border payment is made.