Photo by HSBC Holdings plans to begin offering tokenized deposits to its corporate clients in the U.S. and the United Arab Emirates in the first half of 2026. The bank announced on Tuesday that the initiative aims to expand its use of blockchain technology for payments.
Manish Kohly, HSBC’s global head of payment solutions, revealed that the Tokenized Deposit Service enables clients to send money locally and across borders in seconds, around the clock, rather than during working hours. He also believes that the system can help big corporations better manage liquidity.
HSBC plans to include UAE dirhams for transactions next year
TOP BANKS’VE TOKENISED CLIENT DEPOSITS & CLIENTS CAN NOW SWAP THEM FOR USDC
– WHAT ARE THE IMPLICATIONS FOR AFRICAN BANKS?

Top banks including Citi, HSBC, Deutsche and JP Morgan have tokenised client deposits and they can now swap their money for USDC stable coin.That… pic.twitter.com/JjoOnAPD2y
— ©Dr. Admire M. Dube, CFA® (@admire_dube) November 16, 2025
The financial institution’s tokenized service already functions in Singapore, Hong Kong, the UK, and Luxembourg. The bank also allows transactions in euros, pounds, U.S. dollars, Hong Kong dollars, and Singapore dollars. Kohli acknowledged that HSBC will include UAE dirhams next year when it expands its operations to the Middle East.
HSBC’s initiative follows similar initiatives by other major banks, including Deutsche Bank AG, Citigroup, and Banco Santander SA, which are already exploring how digital assets can facilitate quicker and more efficient payments. The lender’s initiative also comes as the U.S. previously passed the stablecoin legislation, the GENIUS Act, which sets out rules for the digital asset class.
“The topic of tokenization, stablecoins, digital money, and digital currencies has obviously gathered so much momentum. We are making big bets in this space.”
–Manish Kohli, Global Head of Payments Solutions at HSBC.
HSBC’s deposit tokens will be digital assets that represent a claim on existing deposits, functioning as tokenized forms of money already held in bank accounts. The deposit tokens differ from stablecoins, which are typically linked to fiat currencies.
While stablecoins are also backed by high-quality liquid assets such as government debt, deposit tokens are created within the existing banking system and can pay interest. Kohli argued that deposit tokens can become more attractive to clients who hold large amounts of money in their bank accounts.
Kohli also revealed plans for the lender to expand the use of tokenized deposits in programmable payments and autonomous treasuries. He added that the initiative is to include tokenized deposits in systems that use automation and artificial intelligence to manage cash and liquidity risk independently.
HSBC’s executive also acknowledged that the bank sees a big theme around treasury formation in nearly every large firm that it has a conversation with. Other financial institutions, including JPMorgan Chase & Co. and Bank of New York Mellon, are also considering or have already established deposit token services.
HSBC revealed that it processes around $500 trillion in electronic payments a year, making it one of the world’s largest transaction banking providers. However, the bank doesn’t yet disclose volumes on its tokenized deposit service. Banks globally have advanced their experimentation with blockchain technology over the past decade, but only a handful of projects have gone live.
HSBC seeks to get involved in the stablecoin industry
Kohli revealed that the financial institution is studying the stablecoin sector. He also disclosed that HSBC is currently discussing with some stablecoin issuers to offer reserve management and settlement account services.
The bank’s official also mentioned that the lender has not excluded the idea of issuing a stablecoin on its own or jointly with other banks in the future. Kohli revealed that the initiative is something HSBC would continue to evaluate, but there are a few legal frameworks that need to be clearer first.
HSBC’s initiative comes as its CEO, Georges Elhedery, said at the Bloomberg New Economy Forum in Singapore on Wednesday that cross-border trade still presents the lender with massive opportunities. He believes that a cohesive financial system will emerge despite the numerous challenges looming in the sector.
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