HSBC is the latest to expand its tokenised deposit offering, which is increasingly becoming a service banks can no longer ignore, especially when it pertains to the treasury benefits.
HSBC intends to expand its tokenised deposit offering to the US and United Arab Emirates (UAE) in the first half of 2026 to help accelerate settlement times for local and international payments.
The bank’s tokenised deposit service is already live in the UK, Hong Kong, Singapore and Luxembourg, where its corporate clients can send payments via blockchain technology in currencies such as pound sterling, euros, US dollars, Hong Kong dollars, and Singapore dollars.
Speaking to Bloomberg on November 18, HSBC Global Head of Payment Solutions Manish Kohli, revealed the UAE Dirham will become one of the currencies offered as part of the tokenised deposit initiative next year.
“The topic of tokenisation, stablecoins, digital money and digital currencies has obviously gathered so much momentum. We are making big bets in this space,” said Kohli.
One of the core benefits offered by HSBC’s tokenised deposits is that payments can be settled outside the traditional banking hours. This enables HSBC clients to settle funds on weekends and past 5pm GMT during weekdays.
Kohli also highlighted tokenised deposits’ ability to help companies manage their liquidity as the digital representation of bank deposits can be traced back via HSBC’s in-house private blockchain network.
The blockchain network leverages HSBC’s existing bank technology platform and connects this with other distributed ledger technology (DLT) networks. This helps fuel interoperability for customers to perform tokenised deposit transactions from within their own platforms, as opposed to a dedicated platform.
The treasury benefits of tokenised deposits
HSBC is one of many international banks to offer tokenised deposits to their clients. Most recently, US banks Citi and JPMorgan expanded their services to include more currencies and the launch of a dedicated token for tokenised deposit usage.
In an interview with Bloomberg in June 2025, Naveen Mallela, Global Co-Head of Kinexys by JPMorgan, revealed the bank views tokenised deposits as a “superior alternative to stablecoins”.
This could be primarily due to tokenised deposits being able to yield interest as they are created and issued from the bank’s infrastructure. While some stablecoins are able to yield interest, regulations such as the GENIUS Act in the US forbids any stablecoin issuer from earning interest, although there have been some loopholes raised by lobbyists.
“Nearly every large company that we have a conversation with, we are seeing a big theme around treasury transformation,” added Kohli.
Aside from the interest benefits, tokenised deposits also afford banks the ability of instant settlement and 24/7 liquidity when processing domestic and international payments, providing immediate access to funds and streamlining cash flow.
Other benefits include greater reconciliation of retrieving transaction information, as previously mentioned, improving the programmability process to enable automatic payments, and reduced costs by eliminating manual processes, in particular for cross-border payments with the removal of intermediaries.
