Ripple has announced on Monday, 17th June, about their partnership with the currency transmission company MoneyGram. As per the reports, the cryptocurrency company is likely to invest $50 million into the money transfer company; in turn, MoneyGram will use XRP as a part of their everyday operation.
As per the reports, both firms have decided to get into the partnership for two years and will be an exclusive digital asset partner of MoneyGram. Because of the agreement, Ripple will compensate $4.10 for each share for up to 10% share in MoneyGram. This will translate $30 million investment of Ripple, and the remaining $20 million cash infusion will happen in the next two years.
At present MoneyGram, shares are trading at $1.45 for each. The partnership will have its focus on cross broader transactions and foreign exchange settlements.
The CEO of Ripple Brad Garlinghouse has told the partnership will help in achieving an essential goal in cross broader payments, and both the companies are looking for a long-term strategic partnership.
— Brad Garlinghouse (@bgarlinghouse) June 17, 2019
Both the companies will focus on using an xRapid solution of Ripple for on-request liquidity. This will reduce the dependence on previously backed Nostro account by giving instant settlement on the destination money using XRP as a mediator.
The CEO of MoneyGram has said, with xRapid they will be able to settle funds in the destination currency from USD within 24/7. He further added xRapid can transform the process and intensely modernize liquidity management.
The aforementioned partnership will provide Ripple an excellent opportunity to prove xRapid as the best solution to cross broader money transactions. Ripple has been pushing to use XRP by the banks, to use it as a linked currency instead of leaving the money as collateral in the foreign account.
As per Ripple CEO, this will eradicate the need to deploy money in the foreign bank accounts. This will also smooth the treasury process of the company.
This partnership will help MoneyGram to advance their currency transfer services mainly, and millions of individuals across the world can take advantage of its effective operations.
Although the recently Western union has concluded their deal with Ripple for using xRappid sating that it has not helped them in any real savings.