The most common and most likely answer to this crossword clue is the 8 letter word DISBURSE
I've seen this crossword clue in Financial Times
D
I
S
B
U
R
S
E
Buddy explains!
The straight part
We know that "Pay out" is the straight/definition part of the clue. The straight part is often a synonym or definition, in this case pay out = disburse.The cryptic/wordplay part
In cryptic crossword there's often an wordplay/cryptic part as well.This part involves a more complex hint, such as an anagram, homophone, hidden word, etc.
Sadly, We don't have an explanation for this specific crossword clue yet.
What does DISBURSE mean?
DISBURSE verb- To pay out, expend; usually from a public fund or treasury.