More than a year after working with Ripple, Adam Holmes, CEO of US money transfer giant MoneyGram, told CNN in an interview today that the partnership has grown and flourished.
Even with success, the partnership has achieved so far; Ripple plans to cash out about 30% of its stake in MoneyGram.
Partnership With MoneyGram
In June 2019, the company announced a strategic partnership. In return for the equity over the two years of partnership, Ripple was to shell out a $50 million capital commitment to MoneyGram.
MoneyGram would primarily use Ripple’s xRapid service. The system enables inexpensive instant cross-border payments worldwide and reduces the need to store foreign currency.
MoneyGram uses a traditional way to make cross-border payments. They hold foreign currency in multiple bank accounts at all times, which is expensive and limits the flow of funds.
Both partners have a similar goal of increasing cross-border settlements by reducing costs and increasing efficiency through RippleNet. Moneygram uses Ripple products to manage treasuries and currencies.
In the interview, Holmes said the idea behind the 18-month partnership with Ripple was to drive innovation and find out how MoneyGram can spearhead the expansion and global use of blockchain.
According to him, the company’s ability to send money across borders is influenced by the company’s ability to process money transfers in real-time, and its customers are looking for real-time payments, which makes Ripple visible.
He noted that Ripple is doing a lot of unique things with blockchain and crypto to increase the possibility of cross-border settlement in real-time.
Holmes added that it is a very good partnership with Ripple, where they have learned a lot together and continue to push the boundaries of what can be achieved, making it very exciting.
Ripple’s Plans To Cash Out 30% Stake
While the CEO of MoneyGram believes the collaboration is positive, it was reported last month that Ripple plans to cash out about 30% of its stake in a big-profit money transfer company.
The report found that Ripple has 6.22 million shares in MoneyGram, which is the equivalent of 8.6% of the outstanding shares, with the mandate to purchase an additional 5.95 million shares.
In the last 11 months, the company has grown three digits. In November alone, MoneyGram’s online services saw a 136% increase in subscribers, downloads and expansion to other online markets.