Bringing Receivable-Backed Credit Markets Onchain

TL;DR: Receivables are payments that businesses have already earned but not yet received, often tying up working capital as they grow. Receivable-backed credit lets businesses borrow against those future payments, a market that already operates at significant scale offchain. Over the last year, Morpho has been working to bring this activity onchain using Morpho Midnight to make receivables financing more programmable, competitive, and accessible while preserving the institutional controls required. The first receivables-backed markets are expected to arrive soon.

Businesses often deliver goods or services before they are paid. The money owed during this period is called a receivable, representing a contractual claim on a future payment.

Receivables can take different forms, including trade receivables for goods or services already delivered, payment settlement receivables from transactions awaiting settlement, and other contractual payments due in the future.

Consider a bakery in Paris. Customers buy baguettes and croissants every day, mostly by card so those payments don't reach the bakery's bank account immediately. It has generated sales but can’t use that money for its operational needs: buying flour, butter and eggs, and paying employees.

At a small scale, that gap is manageable, but as a business grows, it can tie up significant amounts of working capital and increase the need for financing.

Receivable-backed credit allows businesses to bridge this gap by borrowing against money they have already earned but not yet received, allowing them to operate more efficiently.

Receivables exist across almost every part of the economy: Companies generate invoices when selling goods and services, payment processors wait for settlement from payment networks, and marketplaces may be due payments before passing funds to sellers.

The scale of financing around receivables is already significant. Global factoring turnover alone, which represents receivables sold to financing providers in exchange for upfront liquidity, reached €4.04 trillion in 2025.

Receivable-backed lending is therefore not a new form of credit. What is new is the possibility of bringing more of this activity onto faster, cheaper, and globally available 24/7 financial infrastructure that will ultimately benefit the end customers of payments, such as merchants.

Morpho has spent a year actively working to enable this type of credit onchain leveraging Morpho Midnight, with the first receivables-backed markets expected to arrive soon.

Onchain markets make receivable-backed credit more standardized, composable, and accessible: loan terms can be encoded directly into programmable markets, accounting and operations are automated, and global capital can compete openly to finance these opportunities i.e. Morpho’s ecosystem of lenders and curators can bid to provide the best rates.

Bringing these markets onchain required solving a few specific problems:

• Proving the receivable: lenders need an onchain record of how much is owed and when payment is expected, so they can price and submit financing offers.
• Preventing double financing: once a receivable is used to borrow, it cannot be used as collateral for another loan.
• Repayment priority: when the receivable is paid, outstanding loans are repaid first before any remaining funds are sent to the borrower.
• Access controls and compliance: borrowers and lenders can be gated so participation meets the requirements of the market.
• Competitive fixed rates and flexible terms: borrowers and lenders need to know upfront what the financing will cost and what the lender will receive. Morpho Midnight provides flexible but predictable fixed-rate markets where 100% of capital is utilized.

Receivable-backed lending introduces a new type of collateral: future cash flows that a borrower is already entitled to receive.

Bringing these markets onchain expands the range of economic activity that onchain credit can finance. Rather than being limited to assets held in a wallet, credit markets can begin to connect to the cash flows generated by businesses every day and help bring a sizeable piece of the $200T global credit market onchain.

Reach out if you’re interested in building receivable-backed credit markets!