In a zero-coupon-for-floating swap, when does the fixed rate payer make a payment?

In a zero-coupon-for-floating interest rate swap, the fixed rate payer makes a payment at the maturity date of the swap. This type of swap is structured such that instead of making periodic fixed payments throughout the life of the swap, the fixed payments accumulate and are settled in a lump sum at the end of the swap's term. This allows the fixed rate payer to avoid cash outflows during the life of the swap, making it a preferable option for cash flow management.

The floating rate payments, on the other hand, are typically made on a regular basis based on the prevailing market rates, which means that those fluctuate throughout the swap's life. Thus, the timing of when fixed payments are made is uniquely aligned with the structure of a zero-coupon swap, reflecting its design and purpose within debt and money markets.