For CFOs and treasurers, liquidity has become a key measure of resilience. The question is no longer simply how much cash the business holds, but whether that cash is governed, visible, diversified, and available when conditions change faster than forecasts.

The past 12 months have made it harder. Inflation, supply chain uncertainty, geopolitical conflict, higher-for-longer rate questions, and uneven working capital circumstances have all complicated the job of managing corporate cash. Companies are trying to preserve optionality without leaving value idle. That tradeoff is now central to finance leadership.

The 2026 AFP Liquidity Survey Report, based on responses from over 300 treasury and finance professionals, gives a useful view into how companies are responding to these factors. The report is less a story of liquidity anxiety and more a focus on discipline. Treasury teams are holding larger reserves, but they are also tightening governance, rebalancing exposures, and evaluating new tools with caution first, enthusiasm second.

 

Liquidity Becomes a Strategic Buffer

Nearly half of organizations polled by the Association of Finance Professionals (AFP) increased their U.S. cash holdings over the past 12 months, up from 38% in the prior survey. Only 14% reported a decrease, while 40% saw no significant change. That points to a familiar corporate instinct in uncertain periods: preserve flexibility first, then decide where to deploy capital.

The drivers are not one-dimensional. Stronger operating cash flow was the leading contributor to higher cash balances, cited as having at least some impact by 79% of respondents. But operating strength is only part of the picture. Domestic regulatory risk, geopolitical risk, and debt market activity all pushed companies to build reserves.

For CFOs, cash is no longer merely the residue of operating performance. It is a strategic buffer against volatility in input costs, supply chains, capital access, and customer demand. In this environment, finance leaders are not rewarded for being fully invested at all times. They are rewarded for preserving maneuverability.

 

Governance Is the Difference Between Cash and Control

Higher cash balances can create their own problems. Without clear policy, excess liquidity invites inconsistent decisions, concentration risk, or internal debates over safety versus returns. That’s why governance is emerging as a defining feature of mature treasury ops.

AFP found that three-quarters of organizations now have a written policy governing short-term investment strategy. Among companies with at least $1 billion in annual revenue, that rises to 82%. The numbers are even higher among net investors, investment-grade companies, and public companies.

The most important objective remains safety, named by 61% of organizations with written policies. Liquidity follows at 34%. Yield trails far behind. That hierarchy is telling. It clarifies how treasury teams think about current conditions. They’re paying attention to returns, especially with short-term rates still meaningful. But they are not letting yield drive policy.

 

Beyond Bank Deposits

Bank deposits remain the largest allocation for short-term investments, but their share is falling. The typical organization now holds 42% of short-term investments in bank deposits, the lowest level since 2011. At the same time, companies continue to place an average of 83% of short-term balances in traditional safe and liquid vehicles: bank deposits, money market funds, and Treasury securities.

That is not a flight from banks. It is a recalibration. Treasury teams still care deeply about banking relationships, but they are more conscious of where balances sit, how concentrated they are, and whether alternative instruments offer a better mix of safety, liquidity, and yield.

The survey shows the practical side of it. When selecting banks for deposits, organizations most often cite the overall relationship with the bank, followed by credit quality, counterparty risk, and yield. Counterparty risk rose sharply as a selection factor, a sign that companies are looking past rates to the resilience of the institution holding their cash.

This is where CFOs and treasurers may need to challenge old assumptions. A long-standing banking relationship still matters, but it does not replace concentration limits, credit analysis, or a clear view of liquidity access, per AFP.

Strong banking relationships matter, but they don't replace sound risk management.

 

Real-Time Money Movement Is Changing Liquidity Expectations

The growth of real-time payments is beginning to alter expectations for liquidity products. Forty-one percent of organizations expect money market funds to offer 24/7 liquidity as real-time payments expand (up from 38% last year). Another 33% remain uncertain, which may be the more revealing number. Treasury leaders see the direction of travel, but many are still working through what it means operationally and from a policy standpoint.

The appetite becomes clearer when policy compliance is assumed. If permitted under their investment policies, 86% of respondents said they would select real-time money market funds, and 68% would choose real-time investment sweeps.

This is not just a product question; it’s about operating models. As payment rails move closer to continuous availability, liquidity management built around traditional cutoffs will look increasingly mismatched. Treasury teams will need better intraday visibility, faster decisioning, and clearer rules for when cash moves between operating accounts, investment vehicles, and payment obligations.

The finance function does not have to become speculative to modernize. It does need to reconcile a 24/7 payment environment with policies, controls, and systems built for business-day liquidity.

 

Sizing Up Stablecoins

The survey also explored treasury attitudes toward stablecoins and tokenized products.

Stablecoins and tokenized products are attracting attention, but treasury adoption remains limited. Only 1% of organizations are conducting pilots or using stablecoins or tokenized funds in limited applications. Just under ten percent are actively exploring use cases. A majority are aware of the technology but not exploring it, and 35% are not familiar with their organization’s status. That caution is rational.

Still, the issue cannot be dismissed. What seems likely is that treasury’s attention will stay more focused on cross-border payments, FX-related workflows, settlement timing, and cases where traditional rails impose cost or friction.

For most CFOs, the right posture is neither hype nor dismissal. Stablecoins belong on the watchlist. The more immediate priority is to ensure liquidity governance can adapt as real-time payments, tokenized funds, and bank-backed digital settlement options mature.