MoneyGram and Ripple have partnered to ensure fast and efficient cross-border payments using Ripple's digital token XRP and xRapid product.
Money transfer giant MoneyGram watched its stocks jump after announcing Monday its partnership with blockchain company Ripple.
Based on a Fortune report, the money transfer service will welcome a $30 million investment from Ripple to buy shares at $4.10 each. MoneyGram also has the option to sell $20 million worth of shares to the blockchain company for at least the same price.
The new partnership will enable MoneyGram to use Ripple’s digital token XRP and xRapid product to transfer money much faster and more efficiently.
— Brad Garlinghouse (@bgarlinghouse) June 17, 2019
MoneyGram reportedly began testing the xRapid product in 2018. Although rival Western Union dropped xRapid after a series of tests, MoneyGram sees this product as the solution to cross-border payment challenges.
Alex Holmes, CEO of MoneyGram, said in a statement:
“Through Ripple’s xRapid product we will have the ability to instantly settle funds from US dollars to destination currencies on a 24/7 basis, which has the potential to revolutionize our operations and dramatically streamline our global liquidity management.”
Through xRapid, the money transfer giant will no longer rely on traditional transfers and markets, and therefore will significantly lessen settlement fees and speed up the process.
Ripple CEO Brad Garlinghouse highlighted in the announcement that the strategic partnership will benefit millions of individuals across the globe.
MoneyGram currently provides services to 200 countries and territories from various regions.
Meanwhile, Ripple (XRP) price jumped from $0.4298 to $0.4579 amid the announcement. At press time, the XRP/USD pair trades at $0.45 with a five-percent increase in the past 24 hours.