MoneyGram released their first quarter financial results with details on what they have in the works for transitioning toward a more digital future with expansion into digital services and assets such as DLT, Ripple and possibly cryptocurrencies.
MoneyGram Begins Digital Transition
Overall numbers were down for the first quarter 2018 for MoneyGram. Money transfer revenue was $336.6 million, and they showed a 20% decrease in net income to $7.1 million. But CEO Alex Holmes highlights their commitment with leading the way for digital integration.
“We are increasing our investments in digital assets as we accelerate our transition to a digitally enabled customer-first organization.”
Moneygram.com revenue grew 21% primarily from new customer acquisitions. Digital revenue represented 16% of total money transfer revenue. The company took on $7.3 million in expenses in the quarter for restructuring and reorganization to fulfill this transition, and expects the full cost of the program to be approximately $15 million.
CEO Alex Holmes also notes that they are doing so with industry leading government compliance standards:
“While these standards are expected to adversely impact transactions and revenue in 2018, we are setting the industry paradigm and intend to be at the forefront of compliance as we lead our business into the future.”
In January 2018 Moneygram tested Ripple’s xRapid system. The company has not yet announced if they will follow through with implementing Ripple’s services. CEO Alex Holmes has been clear that the importance for their company is the underlying tech, not cryptocurrencies such as XRP.
“Every day blockchain technology is changing the norm and encouraging innovation. Ripple is at the forefront of blockchain technology and we look forward to piloting xRapid. We’re hopeful it will increase efficiency and improve services to MoneyGram’s customers.”
Blockchain development is happening rapidly. Even old standards like SWIFT are being left behind for unique blockchain solutions in Russia. The availability of Baas (Blockchain as a Service) providers continues to grow, and may push Ripple out of competition.
One of three main services from Ripple, xRapid focuses on creating liquidity through the use of digital assets such as XRP. This can result in lowers costs on money transfers while enabling real-time payments in emerging markets.
This new development in the money transfer services offered between Walmart and Moneygram was released in early April. It allows customers to send money from Walmart in the US to any MoneyGram location in 200 countries.
Walmart also offers MoneyGram’s Bill Pay Service in store. If Moneygram begins to deal with cryptocurrencies, this could give individuals the ability to pay their bills in cryptocurrency.