- MoneyGram announced that it started using xRapid solution.
- Ripple may additionally invest in MoneyGram $20 million by buying its shares.
The second-largest money transfer platform in the world, MoneyGram, is now using the xRapid solution developed by California-based Fintech startup Ripple to make cross-border payments. This was announced by MoneyGram CEO Alex Holmes in a corporate call devoted to the financial results of the second quarter.
So, the first transactions through xRapid took place last week, but the company did not disclose data on current payment volumes.
“The partnership enables us to more closely align funding costs to daily transactions, which will help streamline our global liquidity management,” the company said in a statement.
Note that the xRapid product is based on the XRP token and allows sending funds in one currency and instantly perform the settlement in another currency. MoneyGram added that partnership with Ripple could bring additional profit to the company by reducing costs.
Holmes confirmed that the fintech-startup also acquired MoneyGram shares at $4.10 per share even as they traded at $1.45. He did not disclose the exact amount of investment, but the media reported about $30 million and an obligation to purchase shares for another $20 million as needed.
It is worth noting that the community was skeptical about the deal as MoneyGram has lots of debts and its existence raises some questions.
However, it is worth pointing out that the system serves several million people in more than 200 countries.
Ripple and MoneyGram concluded their first agreement in early 2018