Tokenized Deposits and the Shift to 24/7 Bank Payment Infrastructure: Toward an Era of Immediately Usable Liquidity

For CFOs and treasurers of companies operating globally, expectations of banks are shifting significantly: from knowing where funds are held (“visibility”) to being able to move and use those funds immediately at the time and place they are needed (“usability”). Traditionally, banks have focused on accurately managing account balances across locations and processing payments safely. For corporates, however, building an operating model that minimizes idle cash and allows funds to be deployed into the business at any time, 24/7/365, is increasingly becoming a source of competitive advantage. In practice, multinational enterprises still face repeated cases in which time zones and weekend constraints prevent funds from being mobilized efficiently. For Japanese companies, for example, cross-border payments can be constrained by the operating hours of systems on both the sending and receiving sides, correspondent bank cut-off times, and processing across multiple time zones. As a result, even when an overseas subsidiary faces a funding shortfall during a Japanese holiday or overnight period, funds cannot always be supplied immediately, creating periods in which liquidity remains trapped.

In this respect, the gap with leading overseas banks in cross-border payments has become increasingly visible. Major banks in Europe and the United States have already begun offering global payment services that operate around the clock. Citigroup, for instance, has enabled 24/7 cross-border payments through its own digital platform, while HSBC has expanded services in response to European instant payment requirements that mandate immediate settlement on all business days. These initiatives are designed around corporate liquidity needs. By contrast, while domestic transfers in Japan have moved toward 24-hour availability through the Zengin More Time System, Japanese banks still tend to rely on long-standing daily batch-processing structures for cross-border payments. There remains substantial room to advance capabilities such as real-time global transfers and continuous balance management. If this gap persists, it could affect the competitiveness of Japanese banks in the global transaction banking market. Modernizing payment infrastructure is therefore a high-priority management agenda for Japanese banks seeking to maintain trusted relationships with corporate clients and preserve their presence in global markets.

How should blockchain technology be positioned so that it can contribute to the transformation of bank infrastructure? The key is to treat blockchain as a means, not an end. Japanese banking systems are large-scale legacy platforms centered on mainframes. Given this reality, phased modernization is more realistic than full replacement. One practical approach is to preserve robust existing core banking systems while attaching new technologies to surrounding areas or additional functions. This makes it possible to deliver new value steadily while reducing the large-scale investment and migration risks associated with a full replacement.

Focusing on blockchain’s programmability—the ability to execute automated processing based on contractual rules—makes it possible to control fund movements in ways that conventional systems have struggled to support. Examples include automatically completing designated transfers after business hours or executing pre-scheduled transactions at a specified time without manual intervention. Smart contracts can reduce human-dependent operations across a wide range of activities. If the “latent inefficiencies” currently embedded in daily payment operations, such as liquidity trapped overnight or on holidays and human errors, can be addressed through automated blockchain processing, the core operations of banks themselves could be strengthened. In addition to new service development, using blockchain as a means of infrastructure modernization can deliver practical and significant benefits for banks.
Through its support for multiple domestic financial institutions, ABeam Consulting has repeatedly observed a common conclusion: while full renewal may be examined as one option, the practical path for core-system modernization is to retain existing foundations and attach or extend specific functions externally. This practical conclusion forms the starting point for the “sidecar model” discussed in the next chapter.

The usefulness of blockchain is clear, but a phased approach is more realistic than full-scale rollout from the outset. This makes a phased implementation strategy essential. Once priority areas have been identified, banks should begin with pilots in limited domains. For example, they could narrow the scope to a particular currency zone or region where demand is high, and benefits are easy to measure and conduct trial operations for a 24-hour payment service using tokenized deposits. One possible project would be to select a corporate group with strong global needs for immediate U.S. dollar fund movements and monitor intra-group liquidity transfers for six months to one year. If such a proof of concept can demonstrate concrete benefits through data, such as improved liquidity efficiency and reduced administrative burden, it can provide a foothold for the next step.

Once results have been confirmed through the pilot, the bank can move to phased functional expansion and standardization. What was initially limited to one currency and one-use case can gradually be expanded to additional currencies, regions, and transaction types. For example, a service that begins with U.S. dollar transfers could next be applied to the euro or yen; an instant fund transfer service limited to a specific corporate group could be expanded to counterparties or interbank settlement. By setting KPIs at each stage and applying phase-gate management—moving to the next phase only when issues have been resolved—banks can advance bold transformation while making risks visible. The ultimate objective after these steps is a platform that manages liquidity across the globe in an integrated manner. Building a mechanism that uses tokenized deposits to allocate funds across multiple currencies and regions on a 24-hour, non-stop basis will contribute to banks’ long-term competitiveness.

This paper has examined changes in the environment surrounding corporate treasury and a phased modernization strategy for financial infrastructure using blockchain technology. The new trends in global payments represent a major opportunity for banks. Faster and 24-hour payments can go beyond improving bank-service efficiency and reducing costs; they may also enhance fundamental value by optimizing corporate working capital, strengthening global supply chains, and creating new financial services.

To truly capture these benefits, banks themselves must take the initiative. Concrete actions are required, such as reviewing current processes, identifying areas that can be modernized through a sidecar model, inventorying corporate clients’ 24/7 liquidity needs, selecting priority use cases and currency markets, and launching pilots. In the implementation phase, banks should form cross-functional teams, design roadmaps for phased introduction, and proceed with activities such as incorporating the initiative into IT strategy and conducting technical verification in limited domains. Starting small, confirming the effects, and then expanding step by step based on proven success patterns—this is the surest path toward transformation.

ABeam Consulting has extensive experience supporting numerous financial institutions and corporations in Japan and overseas in advancing global payments, liquidity management, and digital transformation. We bring knowledge from both the banking and corporate perspectives. When undertaking the kind of financial infrastructure modernization discussed in this paper, ABeam can provide support across each phase, from current-state assessment and phased implementation design and execution to regulatory response and globally integrated operations. We would welcome the opportunity to discuss how we can help.