MoneyGram International Inc. MGI, once a completely bricks-and-mortar money transfer company, is investing heavily in developing its digital money transfer platform to stay ahead in the rapidly-evolving remittance industry.
Digitalization is the way of life and the remittance industry is undergoing a sea change in the way funds are being moved across borders on a real-time basis at a fraction of the cost that it earlier used to be (when companies would operate their stores at remittance locations).
A host of fintech companies, such as OFX, WorldFirst,TransferWise, WorldRemit, Ria, Azimo and Remitly thronging the remittance market revolutionized the space with their high technology offerings, thereby making the transfer of funds via electronic modes a new normal.These fast-coming changes also posed significant competitive challenges to even an age-old, established player in the market like MoneyGram International.
The company’s revenues have been under pressure over the past many years due to rising competition. Grappling with this issue, the company prioritized investment in its digital money transfer arm for growth as one of its key strategies to achieve long-term progress.
In fact substantial work done on the digital front enabled the company to tide over the tough operating landscape posed by COVID-19.
MoneyGram invested substantially over the past decade in building a leading omnichannel platform for cross-border, cross-currency, money transfers and payments. The company’s vast network, powered by digitalization, enables it to deliver money and payments effectively through multiple channels across the globe.
Recently, MoneyGram announced 162% year-over-year cross-border transaction growth in August for MoneyGram Online, its direct-to-consumer digital business. Strong consumer demand for the company’s leading digital capabilities and customer-centric app continues to accelerate and its active digital customer base broadened with digital customer wins as transactions happen more frequently owing to a seamless customer experience.
The company’s digital output is driven by an ongoing demand for its customer-centric mobile app, high customer retention rates and a focused account deposit digital market expansion. Aligned with this vital strategy, MoneyGram recently announced new mobile wallets partnerships in Africa to further accelerate its digital growth and lead the industry in mobile money adoption across the globe.
After suffering transaction declines since March, the company recently regained its positive revenue momentum , courtesy of the phenomenal expansion of its digital business as well as the continued improvement in its retail walk-in business across many markets around the world.
A robust digital business bodes well for MoneyGram as its revenues have been declining since 2017 through first-half 2020. Revenues were affected by a deliberate strategy of higher compliance control and an imposition of restrictions on certain transactions. Via its digital business, the company is exploring untapped geographies and attracting a completely new customer base.
Some other companies active in the digital money remittance space are Western Union Co. WU, PayPal Holdings, Inc. PYPL and Square, Inc. SQ among others.
In six months’ time, the stock has soared 90% compared with its industry’s growth of 13.3%.
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Content Originally Published by Google.
source https://blog.jsa.digital/index.php/2020/09/25/moneygrams-investment-in-digital-arm-to-accelerate-growth/
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