Ripple to invest $50 million in MoneyGram

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San Francisco, US: Ripple, a global enterprise blockchain solutions provider for global payments, has entered into a major partnership with MoneyGram, one of the world’s largest money transfer companies.

Initially, the two year-partnership will see Ripple as MoneyGram’s key partner for cross-border payment and foreign exchange settlement using digital assets.

Also, Ripple said it will invest upto $50 million in MoneyGram in exchange for equity over a two year period and will deploy its xRapid product.

Ripple’s xRapid product is a solution for on-demand liquidity, which reduces reliance on pre-funding by enabling money to be sent from one currency and instantly settled in the destination currency.

It leverages XRP, the native digital asset of the XRP Ledger, as a real-time bridge between the sending and receiving currencies. XRP remains the most efficient digital asset for settlement with transaction fees at just fractions of a penny, compared to other digital asset fees of about $30 per transaction. Similarly, the average transaction time for XRP is two to three seconds with other top digital assets ranging from 15 minutes to an hour.

“As the payments industry evolves and matures, it’s imperative that we continue to improve our platform and provide the most effective solution to get funds from point A to point B,” said Alex Holmes, MoneyGram Chairman and CEO. “Through Ripple’s xRapid product, we will have the ability to instantly settle funds from US dollars to destination currencies on a 24/7 basis, which has the potential to revolutionize our operations and dramatically streamline our global liquidity management.”

MoneyGram operates globally in the $600 billion global remittance market, serving millions of customers in more than 200 countries and territories, supporting multiple currencies. Today, MoneyGram relies on traditional foreign exchange markets to meet its settlement obligations, which require advance purchases of most currencies. Through this strategic partnership MoneyGram will be able to settle key currencies and match the timing of funding with its settlement requirements reducing costs, improving its balance sheet efficiency, and reducing risk.

“This strategic partnership will enable MoneyGram to greatly improve its operations and enable millions of people around the world to benefit from its improved efficiency. This is a huge milestone in helping to transform cross-border payments and I look forward to a long-term, very strategic partnership between our companies,” said Brad Garlinghouse, CEO – Ripple.

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