MoneyGram and Ripple Set to Change the Game of Remittance
Ripple’s CEO said that the deal is “an industry defining milestone,” decreasing cross-border transfer costs to pennies and slashing times from minutes to seconds.
International remittance company MoneyGram have announced a partnership with cryptocurrency company Ripple. Initially Ripple with by MoneyGram shares worth US$30million, with options for future buy-ins.
Ripple’s CEO Brad Garlinghouse tweeted that the deal is “an industry defining milestone.” The deal should decrease cross-border transfer costs to pennies and slash times from minutes to seconds. By using blockchain technology the need for MoneyGram to have prefunded accounts across the globe is removed.
The move comes after Ripple ended a trial with Western Union in June 2018. The two companies had experiments with using Ripple’s coin XRP to facilitate faster and cheaper payments after Western Union CEO told Fortune that the tests did not show any efficiencies.
Shares in MoneyGram will be bought at US$4.10 each, with the market price standing at around US$1.45. Ripple will have around an 8-10% stake in the company and retain an option of buying up to US$20million more shares at the same price in the next two years.