Thursday , September 21, 2023

MoneyGram’s Links to Visa Direct And Hike the Stakes in Near Real Time Remittances

The remittance giants haven’t been shy over the last two years in adopting card-network technology and local payments services to close the last mile for fast transfers directly to users’ mobile devices. And MoneyGram International Inc. on Friday played its latest card in this market with an arrangement that will enable transfers through Visa Direct and to debit card holders throughout most of Europe.

London-based Checkout Ltd., whose service processes payments in more than 150 currencies, will allow senders to use the MoneyGram app or Web site to send funds directly to debit card accounts in 25 countries across Europe.

While closes the last-mile gap to individual accounts, the new capability also relies on Visa Inc.’s Visa Direct, a near real-time transfer service that Dallas-based MoneyGram has been working with since September 2019 for U.S. accounts and since December that year for accounts overseas. Visa Direct relies on a networking capability called the original credit transaction, which has been used for decades to credit consumer accounts after merchandise returns. The transfers via Visa Direct—and through a competing near-real-time service called Mastercard Send—are often referred to as push payments.

MoneyGram has linked with for near-real-time remittances across Europe via Visa Direct.

“Consumer demand for real-time payments direct to bank account and mobile wallets continues to surge,” notes Alex Holmes, MoneyGram’s chief executive and chairman, in a statement. “As a result, we’re excited to integrate with a leading fintech,, and continue to expand our partnership with Visa Direct. We’re already seeing significant customer adoption, and we expect it to help contribute to strong digital growth in the European market this year.”

The competition to add push payments to remittances has heated up over the past 18 months. The Western Union Co. announced a similar arrangement with Visa Direct in June 2019, while MoneyGram expanded its service to the Philippines in October last year after becoming the first remittance service to allow international transfers on Visa Direct 10 months earlier.

The card networks, too, have recognized the potential in expanding near-real-time capability for remittances to overseas markets. In May 2019, Visa won an intense bidding war with Mastercard to acquire Earthport PLC, a London-based remittance firm, for $320.4 million.

MoneyGram announced in October its third-quarter digital revenue had grown 95% year-over-year to $53.2 million. Digital transactions accounted for 27% of all money transfers in the quarter.

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