A Stellar “Path Payment” is an operation which sends an amount in a specific asset to a destination account through a path of offers. This allows the asset sent (e.g., 45 BB1) to be different from the asset received (e.g, 44 EURT).  This could go through an intermediate asset such as XLM if the rate is better.

A few things to note(1):

  • path payment doesn’t allow intermediate offers to be from the source account as this would yield a worst exchange rate. You’ll need to either split the path payment into two smaller path payments, or ensure that the source     account’s offers are not at the top of the order book.     
  • balances are settled at the very end of the operation    

Original wallets that supported this included Stargazer wallet and Papayabot (on Telegram). Bitgo and Keybase also now support this functionality on the Stellar Blockchain. StellarX has plans to add this in Q3 of 2019.

(1) https://www.stellar.org/developers/guides/concepts/list-of-operations.html#path-payment