Franklin, a hybrid cash and crypto payroll provider, is launching a new initiative that aims to turn idle-sitting payroll into an opportunity for yield.
The new solution, dubbed Payroll Treasury Yield, uses blockchain lending protocols to help firms earn returns on payroll funds that would otherwise sit idle, the company told Cointelegraph in an exclusive statement.
Franklin said its new offering integrates Summer.fi, a decentralized finance (DeFi) lending platform, to allow companies to deposit stablecoin-denominated payroll reserves into smart contract-based lending pools.
These funds are lent to vetted borrowers, and companies earn yields while retaining access to their capital. Companies maintain full custody throughout the process, and smart contracts used are audited to reduce risk.
“The problem that Franklin solves for is two-fold,” Megan Knab, founder and CEO of Franklin, told Cointelegraph. For companies that have already integrated crypto onto their balance sheets, Franklin helps them use those assets to manage their operations, she said.
“But for the broader market, we are enabling business models of the future, where money moves instantly, more intelligently, and to more globally,” Knab added.
Related: PayPal to offer 3.7% yield on stablecoin balances: Report
Alternative to T-Bills
Franklin said its new offering is an alternative to traditional treasury tools like sweep accounts or T-bills, which often involve operational complexity and limited returns.
Furthermore, it differentiates from earned wage access (EWA) platforms, which enable employees to access their earned wages before their scheduled payday by avoiding additional debt and associated costs.
“Traditional payments in the next decade will run entirely on public blockchain rails as a wholesale replacement to ACH and SWIFT,” Knab said.
She added that if onchain payroll products go mainstream, banks could fade into the background. While technology may replace many banking functions with self-custody tools and smart contracts, regulatory frameworks will still require accountable legal entities.
The result may be “zombie-like institutions” — banks in name only, existing to meet compliance rules but playing a minimal role in actual payment processing, Knab said.
However, decentralized lending comes with risks like smart contract vulnerabilities and market fluctuations. Franklin said it aims to mitigate these by using Summer.fi’s audited contracts and overcollateralized lending.
Related: How to Use tsUSDe on TON for Passive Dollar Yield in 2025
Rising interest in yield-generating strategies
Interest in yield-generating strategies within the cryptocurrency sector has surged in recent years, driven by both retail and institutional investors seeking to maximize returns on their digital assets.
On May 16, Solv Protocol launched a yield-bearing Bitcoin token on the Avalanche blockchain, giving institutional investors more exposure to yield opportunities backed by real-world assets, or RWAs.
On May 1, Ryan Chow, co-founder and CEO of Solv Protocol, said the demand for yield-generating strategies around Bitcoin is surging, especially from firms seeking liquidity without liquidating their BTC.
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