MoneyGram Launches Crypto-to-Cash Service

https://finovate.com/moneygram-launches-crypto-to-cash-service/
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  • MoneyGram is rolling out a service that will enable users to buy cryptocurrency using cash, as well as allow them to withdraw their crypto holdings in cash, at select MoneyGram locations.
  • The new capabilities are made possible via a partnership with Stellar Development Foundation.
  • The service is currently available in the U.S., Canada, Kenya, and the Philippines.

While Western Union is taking payments digital, its competitor MoneyGram is bringing them into crypto. MoneyGram announced today it has begun to roll out a service that will enable cash users to access cryptocurrency via participating MoneyGram locations.

The new service is the result of a partnership between MoneyGram and the Stellar Development Foundation (SDF), the organization behind open-source public blockchain Stellar that allows money to be tokenized and transferred globally. MoneyGram and SDF originally partnered in October of last year, when the two piloted the functionality that enabled digital wallet holders to deposit cash into their digital wallets at MoneyGram locations, send payments internationally via Stellar, and exchange Stellar for cash currency.

The functionality of exchanging cash to cryptocurrency and back to cash again aims to offer unbanked populations access to the digital economy. The fund transfer capabilities don’t require a bank account or a credit card. Consumers that hold a digital wallet with Vibrant or LOBSTR can visit a participating MoneyGram location to load their digital wallets using cash or to cash out their digital currency holdings into cash. MoneyGram expects to collaborate with more digital wallets in the future.

To incentivize adoption of the crypto in/out feature among its 150 million customers, MoneyGram is not charging a fee for the service for the first year.

“A much-needed solution to the cash-to-crypto on/off-ramp problem is here,” said Stellar Development Foundation CEO and Executive Director Denelle Dixon. “Today, almost 2 billion people rely on cash for their livelihood, with no options to access the digital economy. At the same time, a persistent pain point for crypto-native users is off-ramping cryptocurrency quickly and reliably. The groundbreaking nature of this service is how it solves problems for a range of users with varying needs around the world.”

The service is currently available in the U.S., Canada, Kenya, and the Philippines. By the end of this month, global cash-in functionality will be available in seven more countries and cash-out functionality will be available globally (where permitted by law).

MoneyGram, an 82-year-old fintech, was acquired by private equity investment firm Madison Dearborn Partners in a $1.8 billion deal earlier this year. Alex Holmes is chairman and CEO.


Photo by MART PRODUCTION

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