TL;DR
Most cross-border payout providers require you to pre-fund a balance before you can send a single payment. You deposit capital into one or more accounts, the provider draws down per payout, and you top up when the balance runs low. If you pay into multiple currencies, you maintain multiple balances.
This model works, but it comes with a cost that does not show up on any fee schedule: trapped capital.
Per-transaction funding is the alternative. You fund each payout at the point of initiation, with no standing balance required. Here is how it works and why it matters for fintechs and platforms with cross-border payout requirements.
The Pre-Funding Problem
Traditional payout providers like Nium, Thunes, and Airwallex operate on a pre-funded model. Before you can execute payouts, you transfer capital to the provider and maintain a balance. The provider draws down from this balance as payouts are executed.
The issues compound as you scale. If you pay into 10 currencies, you maintain 10 balances. Capital sits idle in jurisdictions where payout volumes are unpredictable. FX exposure accumulates across every currency you hold. And when you want to add a new corridor, you need to fund a new balance before the first payout can go out.
For a fintech processing $2M in monthly payouts across 8 currencies, the working capital locked up in pre-funded balances can easily reach $300K to $500K. That capital earns nothing while it sits with the provider [1].
How Per-Transaction Funding Works
Per-transaction funding eliminates the standing balance entirely. The flow is straightforward.
You initiate a payout via the provider's API, specifying the beneficiary, amount, and currency. At the same time, you fund that specific payout. The provider receives the funding, converts to the destination currency if needed, and executes the payout via SWIFT or local rail. The beneficiary receives local currency in their bank account.
The funding can be fiat (a transfer to the provider's account timed to the payout) or stablecoin (USDC or USDT sent per transaction). With stablecoin funding, the entire cycle from funding to delivery can complete in under an hour for many corridors.
The critical difference: your capital is in motion, not parked. You fund at the point of need and the provider delivers immediately. No float, no idle balances, no multi-currency cash drag.
What Changes Operationally
No nostro account management. You do not maintain accounts in multiple currencies with the provider. One funding method covers all corridors.
No balance monitoring. No dashboards to watch, no top-up alerts, no risk of a payout failing because a balance ran dry at 2am in a timezone you forgot about.
Faster corridor expansion. Adding a new payout destination does not require opening a new account or transferring an initial deposit. If the provider supports the corridor, you can fund and pay into it immediately.
Simpler treasury. Your finance team manages one funding flow instead of reconciling balances across multiple currency accounts with different providers.
Fiat vs Stablecoin Funding
Per-transaction funding works with both fiat and stablecoins, but the mechanics differ.
With fiat, you transfer funds to the provider's account (typically via a named virtual account in SGD, USD, or another supported currency) timed to your payout batch. The provider receives the fiat, converts if needed, and executes. This works well for predictable, scheduled payout runs.
With stablecoin funding, you send USDC or USDT to the provider at the point of each payout initiation. The provider off-ramps the stablecoin to local fiat and delivers. This is particularly useful for ad-hoc payouts, variable volumes, or fintechs that already hold stablecoins in their treasury. There is no balance to maintain and no FX exposure from holding multiple currencies.
Most fintechs start with fiat per-transaction funding and add stablecoin as their operations mature. Some use both depending on the corridor and urgency.
For a deeper look at how the stablecoin funding model works within cross-border settlement, see our stablecoin sandwich guide.
Who Benefits Most
Per-transaction funding is most valuable for fintechs and platforms with these characteristics: payouts across multiple countries and currencies (where pre-funding means maintaining many balances), variable or unpredictable payout volumes (where pre-funded balances are either too large or too small), fast-growing corridor coverage (where adding a new market should not require a new funding setup), and capital-constrained operations (where every dollar locked in a provider balance is a dollar not deployed in the business).
For platforms making cross-border payouts at scale, the working capital savings alone can be significant. A fintech that eliminates $400K in pre-funded balances frees that capital for growth, product development, or yield-generating activities.
The EY-Parthenon survey found that 77% of corporates already using stablecoins cited cross-border supplier payments as their top use case, driven primarily by the cost and speed advantages that per-transaction funding enables [2].
Sources:
[1] McKinsey & Company. "The 2025 McKinsey Global Payments Report." September 2025. https://www.mckinsey.com/industries/financial-services/our-insights/global-payments-report
[2] EY-Parthenon. "Cost Savings and Speed Drive Stablecoin Adoption." 2025. https://www.ey.com/en_us/insights/financial-services/cost-savings-and-speed-drive-stablecoin-adoption
Disclaimer: Stablecoin-related services are provided exclusively by Tazapay Canada Corp, a FINTRAC-registered Money Services Business. Tazapay Pte. Ltd. (Singapore) does not provide Digital Payment Token services under the Payment Services Act 2019.
