[Photo: Moneygram global partners in 198 countries. Source: Ripple Telegram Channel]
Back in the 90s, when my big brother was a student in the United States, and the Internet boom allowed anyone to work in technology so long as you were willing, he had a few extra dollars and Western Union was the best form of money transfer. So much so, that whenever we had birthdays as young boys, my big brother would send home $50 or $100 to help with the birthday celebrations.
Back then, the fees charged by Western Union were ridiculous. To send $500, you would cough up $43 in transaction fees.
It would have been cheaper to send the money via post, but it would take two to three months having it delivered to Nairobi, Kenya. The other risk involved in doing so, were the curious post office guys at the local post office who had a habit of treasure hunting in people’s mailboxes.
They were famous for scrutinizing every parcel or letter from abroad. They were sure they’d hit the jackpot by either finding cash, latest hip hop magazines or even the random copy of playboy!
What I am trying to say is that international money transfers have always been a hurdle for a very long time especially for immigrants in the United States, Europe or Australia, who want to send money back home to their families in Africa, South America and Asia.
Moneygram has made such hurdles shorter. Standard time spent to complete a money transfer is 1 day. The transaction fees are far much lower than my earlier example for Western Union. For one to send $1,000, it would cost $4 using your bank account. This is around 0.4% if the intended money to be sent.
Also, with Monyegram, you can send money to over 198 countries at home on your laptop or in person at one of their partner retailers. You can send money directly to bank accounts, mobile wallets like MPesa and even money to an inmate in the U.S.
So why is Moneygram the golden goose for Ripple?
Firstly, when the Moneygram partnership announcement was made, XRP’s price on Binance shot from $1.68 to $2.62 in less than 40 minutes. This is an increase of 56% in a very short period. I am sure this was a tasty treat for the day traders and a welcome relief for the XRP diehards.
After the short pump, XRP has maintained a price of above $2 as I write this. It might drop a bit to correct the 56% pump, but I am sure it will keep up its momentum as more partners are announced.
The second reason why Moneygram is the golden goose for XRP is because of the tones of partners in 198 countries. They include: Walmart, 711, Standard Bank, CVS, Walgreens, SBI, Paypal, Citibank…just to name a few.
This means Ripple automatically gains more partners in extension through Moneygram. These partners will probably use the Ripple technology or currency to send and receive money through their numerous retail outlets.
Picture this, someone sends you money using Moneygram from let’s say Colorado. It is for a payment of services rendered for maybe delivering a very good custom made, hand knitted scarf for use during the bitter winters in Colorado. The guy in Colorado saw your scarf on Instagram. You are in Kenya, and you make these scarfs for your grandkids. Within minutes, you have the payment in your MPesa mobile account.
Such efficiencies are why Ripple is rumored to be making banks happier with their lightning speed transactions. The average Ripple transfer is 3.3 seconds.
The third reason why Moneygram is the golden goose for Ripple is that the announcement of the partnership came after a disappointing first week in January where Coinbase publicly stated it will not be listing XRP anytime soon on its exchange.
This led in a loss in value for XRP on the numerous exchanges available.
Many were banking on the Coinbase announcement to pump the prices to the much anticipated Stratosphere of $5 – $6.
With the Moneygram announcement, things are beginning to look good for Ripple on the exchanges and the sky is the limit.