MoneyGram International, Inc. ( MGI Quick Quote MGI - Free Report) recently announced that its direct-to-consumer digital business, MoneyGram Online (MGO), has reported robust results in June 2021.
Shares of MoneyGram gained 2.9% on Jul 16.
The company reported cross-border transaction growth of 44% year over year this June. The API-driven MoneyGram app intends to serve consumers by utilizing its consumer-centric capabilities. This, in turn, has compelled customers to reemphasize their trust on the app and bolstered the company’s digital business growth.
The cross-border business gain for June was lower than 53% cross border transaction growth reported for May 2021 on a year-over-year basis in its MGO business.
Nevertheless, digital receives encompassing direct transfers to accounts, cards, and mobile wallets in the recently concluded second quarter delivered record transaction growth of 77% year over year.
The digital platform of MoneyGram has been built on the back of extensive investments undertaken and several alliances with well-established financial institutions. This platform started yielding results last year amid the COVID-19 induced uncertainties. The MGO business witnessed triple-digit cross-border transaction growth for 15 consecutive months until March of this year and the metric continues to be on an impressive growth trajectory till the last month.
Share of Moneygram's digital business in money transfer transactions has been on the rise. The company’s digital arm accounted for 32% of total money transfer transactions at the end of first-quarter 2021. Now the arm is projected to cross over 50% of all money transfer transactions in 2024.
Strict lockdowns triggered by the pandemic imposed severe restrictions on cross-border movements but the emergency needs of families and friends residing elsewhere could not be overlooked. This scenario made digital money transfers the need of the hour. MoneyGram has been able to capitalize on the same and has been able to capture a substantial share in the P2P market, courtesy of its strong digital platform. The company even has a solid pipeline of new digital partners in place in a bid to bolster prospects of its digital arm.
The company’s digital channel holds promising growth prospects across the P2P market, attributable to growing demand for real-time payments and increased smartphone usage, which popularized the usage of mobile wallets. Per Grand View Research, the global real-time payments market is anticipated to witness a CAGR of 33% over the 2021-2028 period.
Some other companies, which are active in the digital money remittance space and have been undertaking technological investments to upgrade their digital arm, include
The Western Union Company ( WU Quick Quote WU - Free Report) , Square, Inc. ( SQ Quick Quote SQ - Free Report) and PayPal Holdings, Inc. ( PYPL Quick Quote PYPL - Free Report) . Zacks Rank & Price Performance
Shares of MoneyGram have soared 231.3% in a year compared with the
industry’s growth of 4.5%. Image Source: Zacks Investment Research
MoneyGram has a Zacks Rank #4 (Sell).
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