Author: Michael Salerno, Vice President, International Banking

The future of global payments is being shaped by digital money, including stablecoins and tokenized deposits, alongside advances in cross-border payments infrastructure.

Key Takeaways

• Global payments are evolving through faster systems, richer data, and digital money innovation.
• ISO 20022 is improving cross-border payments through standardized, structured data exchange.
• Stablecoins and tokenized deposits are emerging as key models of digital money.
• Stablecoins operate outside banks, while tokenized deposits remain within regulated banking systems.
• Both aim to enhance speed, transparency, and 24/7 global payment capabilities.
• The future of global payments will be defined by speed, data, and trust working together.

Global payments are becoming faster, richer in data and increasingly digital. While instant settlement and blockchain innovation often dominate headlines, the deeper transformation lies in how payment infrastructure, data standards and digital money are converging.

Together, these forces are reshaping not only how money moves, but how global payments operate across financial systems.

For banks, businesses and policymakers, payments modernization is no longer theoretical. It is unfolding in real time and raising important questions about interoperability, regulation and the future role of financial institutions in a digital economy.

Speed Matters, But Data Enables Scale

Faster payments capture attention, but better data delivers long-term value. Moving bad data faster is not progress — it simply accelerates errors and multiplies downstream problems. The real opportunity lies in moving high-quality, structured data through the financial system as efficiently as possible.

Cross-border payments have historically suffered from limited transparency, unpredictable fees and settlement uncertainty. Even as payment networks have accelerated, fragmented data continues to create inefficiencies and operational friction.

I've written elsewhere about how the global adoption of ISO 20022 represents a major step forward for cross-border payments modernization. As a standardized financial messaging language, ISO 20022 enables richer, structured data to move end to end across payment chains. This helps improve compliance screening, reduce manual repair work and enhance interoperability across payment rails that were never designed to work together.

Once payments share a common data language, they become increasingly machine-readable, enabling straight-through processing rates that were previously impossible. That enables automation, analytics and intelligent routing across traditional banking rails, real-time payment systems and emerging digital payments infrastructure.

The migration is now complete — Swift ended support for legacy formats in November 2025, and the Federal Reserve migrated Fedwire in July 2025. The industry is shifting from migration to optimization, focusing on extracting maximum value from richer payment data.

In many ways, ISO 20022 is not simply a compliance milestone, it is helping build the foundation for the next generation of global payments.

How Stablecoins and Tokenized Deposits Are Changing Global Payments

As payment systems modernize, attention is shifting beyond how payments move to how money is represented in digital environments. Businesses increasingly expect payments to operate in real time, across borders and outside traditional banking hours. That demand is accelerating the evolution of digital money within modern payments infrastructure.

Stablecoins and Tokenized Deposits

​The distinction between stablecoins and tokenized deposits is becoming a central topic in digital payments infrastructure and banking modernization.

Stablecoins have emerged as one of the most visible forms of digital money. Typically backed one-to-one by cash or short-term Treasury assets, they are designed to maintain stable value while enabling faster, always-on transfers of digital dollars. Their growth in remittances, digital commerce and emerging markets reflects demand for faster access to U.S. dollar liquidity and more efficient cross-border payments.

At the same time, stablecoins raise important questions around regulation, consumer protection, reserve management and the role of traditional financial institutions. Because many operate outside the banking system, policymakers continue to evaluate how they should be supervised and how they may impact financial stability.

Tokenized deposits take a different approach. Rather than creating a parallel form of money outside the banking system, tokenized deposits are digital representations of traditional bank deposits. They remain on a bank’s balance sheet and operate within existing regulatory frameworks while offering many of the benefits associated with digital payments, including faster settlement, programmability and 24/7 availability.

For financial institutions, tokenized deposits offer a way to modernize global payments infrastructure without sacrificing the stability, trust and lending capacity of the banking system.

What Is Needed for Digital Money to Scale

Despite growing momentum, most digital money initiatives remain in a test-and-learn phase. The focus today is less about moving money at scale and more about understanding operational, regulatory and economic tradeoffs in cross-border payments modernization.

For digital money to move beyond experimentation, several issues still need to be addressed.

• Regulatory clarity — Clear frameworks around issuance, reserves, compliance and supervision are essential for adoption and trust.
• Use case definition — Digital money for investment or trading differs from instruments designed for everyday payments.
• Issuance models — Banks, fintechs and policymakers are still defining who issues digital money and under what structure.
• Economic parity — Whether digital money can earn interest may shape competition with traditional deposits and influence regulation.

Importantly, digital money may improve payment infrastructure and settlement efficiency, but it does not eliminate foreign exchange complexity, compliance requirements or global financial regulation. These remain central to international payments.

Why Banks Are Exploring Tokenized Deposits

Concerns about deposit displacement are understandable, but defensiveness alone is unlikely to succeed. The more durable strategy is evolution.

Tokenization allows banks to offer the speed, transparency and programmability clients increasingly expect while preserving the safeguards that underpin trust in the financial system. Rather than abandoning deposits, financial institutions have an opportunity to modernize them for a more digital economy.

The future of global payments will not be defined solely by speed. It will be shaped by the ability to combine trusted data, innovation and regulatory stability with modern payment infrastructure.

To learn how FNBO can help with your global banking needs, contact our Global Banking team.

About the Author

Michael Salerno joined the bank in 2002 and currently leads the Global Banking team, which includes business development, international payments, foreign exchange management and trade finance solutions for corporate and correspondent banking customers. International issues can present challenges for organizations, and Michael enjoys creating simple and transparent solutions that reduce the complexity of doing business internationally.

​The information provided here is not investment, tax or financial advice. You should consult with a licensed professional for advice concerning your specific situation.

This article was originally published by the Forbes Finance Council.