Maturity payment processing is the set of operational steps by which the final repayment of a debt security reaches its holders. Ahead of the maturity date, custodians and depositories capture the event from the security's terms, confirm the redemption price and any final coupon payment, and fix the positions entitled to payment. On the due date the issuer funds its paying agent, which pays the central securities depository; the depository credits its participants, and each custodian credits its clients and removes the matured holding from their accounts.
Controls include checking that the date follows the correct business day convention, reconciling cash received against expected entitlements, applying any withholding tax, and blocking settlement of trades in the security once it has matured. Late or missing funds are chased with the agent and may signal an issuer default. The process is a mandatory event within corporate action processing and the end point of bond redemption.