Visa tests stablecoins to prefund crossborder payouts via Visa Direct

Visa announced at the SIBOS conference on Tuesday that it is piloting a program that allows banks, remittance firms and other financial institutions to prefund crossborder payouts using dollar and euro stablecoins on its Visa Direct real time payments platform. The pilot will use Circle’s USDC and EURC stablecoins and is aimed at speeding international payouts while reducing the need for firms to park large amounts of fiat currency across multiple corridors.

Under the pilot, participants can fund their Visa Direct accounts with stablecoins, which Visa will treat as cash equivalents for the purpose of initiating payouts, the company said. Visa Direct is the company’s real time rails for sending funds to cards, bank accounts and digital wallets worldwide. The platform currently connects to roughly 11 billion Visa cards and accounts across 195 countries. Visa has settled more than $225 million in stablecoin volume on its network to date.

Visa executives framed the program as a way to modernize treasury operations and improve liquidity management. Chris Newkirk, president of commercial and money movement solutions at Visa, said the goal is to reduce the need for capital to be parked...