--- path: /learn/nostro-vostro-accounts/ title: Nostro and vostro accounts description: Understand nostro and vostro accounts, how correspondent payments use them, and what stablecoin settlement changes for payment operations. image: /og/2026-q4/og_2026-q4_learn_nostro-vostro-accounts_title-f5_v01.png publishDate: 2026-10-26 label: Payments timeToRead: 4 faq: - question: Are nostro and vostro accounts separate accounts? answer: They can describe the same account from opposite sides. The bank holding money at another bank calls it a nostro; the servicing bank calls it a vostro. - question: Is a nostro account the same as prefunding? answer: No. Nostro describes an account relationship. Prefunding describes placing liquidity ahead of expected payments, which can happen in several types of account or provider arrangement. - question: Do stablecoins eliminate correspondent banking? answer: They can replace or complement parts of a settlement flow. Fiat collection, currency conversion, bank payouts, and issuer redemption can still depend on banking relationships. locale: en canonical: https://tempo.xyz/learn/nostro-vostro-accounts/ --- # Nostro and vostro accounts A nostro account is an account a bank holds with another bank, commonly to make and receive payments in a foreign currency. Vostro describes that same account from the bank holding the funds. They are two perspectives on one banking relationship. For a payments team, the important questions are who holds the funds, who can move them, and how much liquidity must be available before a payment can complete. ## One account viewed from two banks Suppose Bank A holds a dollar account at Bank B. Bank A calls it its nostro account, meaning our account with you. Bank B calls it a vostro account, meaning your account with us. Bank A records a claim on Bank B; Bank B records its obligation to Bank A. |Perspective|Name|Operational question| |-|-|-| |Bank A, which owns the balance|Nostro|Do we have enough available dollars to fund the payment?| |Bank B, which maintains the account|Vostro|Can we execute this customer's instruction under the account agreement?| The [BIS guidance on foreign exchange settlement risk](https://www.bis.org/committees/bcbs/basel-consolidated-guidelines/module/rma/20) describes these accounts within correspondent banking. The account relationship provides access to services; it does not establish one universal payment speed or fee. ## How an account supports a payment In a simplified example, Bank A instructs Bank B to use its dollar balance to pay a beneficiary. Bank B debits the account and arranges the receiving leg. Additional institutions, currency conversion, and local payment systems may be involved. An instruction sent successfully is different from a beneficiary receiving funds. Operations teams should retain the instruction identifier, account entry, fees, any FX trade, and final delivery confirmation. See the broader [payment rails comparison](/learn/payment-rails/) for how messaging, clearing, and settlement differ. ## Why prefunding matters Holding a nostro account and prefunding it are different decisions. The account is the arrangement; [prefunding](/learn/prefunding/) is putting liquidity in place before payments need it. Available credit, incoming payments, and the service agreement can also affect funding needs. For an illustrative payout program, a team might track three figures separately: the account balance, the amount already committed to pending payouts, and the amount immediately available for new instructions. A large balance can still conceal a shortage if most of it is reserved. Replenishment cutoffs, holidays, currency exposure, and access to credit determine how much buffer a particular program needs. A count of destination countries alone does not determine the number or size of accounts required. ## What stablecoin settlement changes Stablecoin transfers can provide another way to move value between participating providers. Tempo supports near-instant onchain settlement around the clock, so an operator can evaluate whether faster replenishment reduces balances held ahead of demand. That benefit depends on the complete flow. A provider paying recipients in local currency still needs conversion liquidity, a supported payout method, and confirmation from the receiving provider. The bank account may remain part of that flow. A stablecoin balance also carries different issuer, custody, and redemption considerations from a bank deposit. Use the [cross-border payments guide](/learn/cross-border-payments/) to assess the full payment and the [reconciliation guide](/learn/payment-reconciliation/) to connect its records. ## FAQ **Are nostro and vostro accounts separate accounts?** They can describe the same account from opposite sides. The bank holding money at another bank calls it a nostro; the servicing bank calls it a vostro. **Is a nostro account the same as prefunding?** No. Nostro describes an account relationship. Prefunding describes placing liquidity ahead of expected payments, which can happen in several types of account or provider arrangement. **Do stablecoins eliminate correspondent banking?** They can replace or complement parts of a settlement flow. Fiat collection, currency conversion, bank payouts, and issuer redemption can still depend on banking relationships. --- ## Site links - [Tempo home](/) - [Privacy policy](/privacy-policy/) - [LinkedIn](https://www.linkedin.com/company/tempo) - [X](https://x.com/tempo) - [YouTube](https://www.youtube.com/@tempo) ### Products - [Earn](/earn/) - [Routes](/routes/) - [Zones](/zones/) ### Solutions - [Agentic payments](/solutions/agentic-payments/) - [Cross-border payments](/solutions/cross-border-payments/) - [Institutional settlement](/solutions/institutional-settlement/) - [Stablecoin accounts](/solutions/stablecoin-accounts/) - [Tokenized deposits](/solutions/tokenized-deposits/) ### Developers - [Documentation](/developers) - [Tempo Explorer](https://explore.tempo.xyz/) - [Tempo API](/developers/docs/api/) - [Performance](/developers/performance) - [Status](https://status.tempo.xyz/) - [GitHub](https://github.com/tempoxyz) ### Resources - [Blog](/blog/) - [Customers](/customer-stories/) - [Learn](/learn/) - [OUSD](/ousd/) - [Partners](/partners/) - [Reports](/reports/) - [Stablecoin Advisory](/stablecoin-advisory/) ### Company - [About](/about/) - [Careers](/careers/) - [Brand kit](/brand/) - [FAQ](/faq/)