diff --git a/src/libs/actions/IOU.ts b/src/libs/actions/IOU.ts
index ef8674e2f16c..805f00e89866 100644
--- a/src/libs/actions/IOU.ts
+++ b/src/libs/actions/IOU.ts
@@ -61,6 +61,7 @@ import {addSMSDomainIfPhoneNumber} from '@libs/PhoneNumber';
 import {getPerDiemCustomUnit, getPolicy, getSubmitToAccountID, hasDependentTags, isControlPolicy, isPaidGroupPolicy, isPolicyAdmin, isSubmitAndClose} from '@libs/PolicyUtils';
 import {
     getAllReportActions,
+    getIOUReportIDFromReportActionPreview,
     getLastVisibleAction,
     getLastVisibleMessage,
     getOriginalMessage,
@@ -7851,6 +7852,23 @@ function getReportFromHoldRequestsOnyxData(
     };
 }
 
+function hasOutstandingChildRequest(chatReport: OnyxTypes.Report, excludedIOUReport: OnyxEntry<OnyxTypes.Report>, policyId?: string) {
+    const policy = getPolicy(policyId);
+    if (!policy?.achAccount?.bankAccountID) {
+        return false;
+    }
+    const reportActions = getAllReportActions(chatReport.reportID);
+    return !!Object.values(reportActions).find((action) => {
+        const iouReportID = getIOUReportIDFromReportActionPreview(action);
+        if (iouReportID === excludedIOUReport?.reportID) {
+            return false;
+        }
+        const iouReport = getReportOrDraftReport(iouReportID);
+        const transactions = getReportTransactions(iouReportID);
+        return canIOUBePaid(iouReport, chatReport, policy, transactions) || canIOUBePaid(iouReport, chatReport, policy, transactions, true);
+    });
+}
+
 function getPayMoneyRequestParams(
     initialChatReport: OnyxTypes.Report,
     iouReport: OnyxEntry<OnyxTypes.Report>,
@@ -7937,7 +7955,7 @@ function getPayMoneyRequestParams(
     const optimisticChatReport = {
         ...chatReport,
         lastReadTime: DateUtils.getDBTime(),
-        hasOutstandingChildRequest: false,
+        hasOutstandingChildRequest: hasOutstandingChildRequest(chatReport, iouReport, iouReport?.policyID),
         iouReportID: null,
         lastMessageText: getReportActionText(optimisticIOUReportAction),
         lastMessageHtml: getReportActionHtml(optimisticIOUReportAction),