Ripple has invested $50 million in global money transfer giant MoneyGram in a bid to push for the adoption of its native XRP token. The two companies will partner in an initial two-year term that will see MoneyGram turn to XRP for its cross-border payments and foreign exchange settlements using digital assets.
In its press release, Ripple revealed that the two companies will focus on the xRapid product, a solution by Ripple that relies on the XRP dark coin for cross-border transfers. Ripple’s two other enterprise solutions, xVia and xCurrent don’t rely on XRP.
Ripple has struggled in its push for the mainstream use of its XRP token by banks. While it has partnered with close to 100 banks and financial services firms, it has failed to enroll them on its XRP-powered products. Its latest pilot venture with MoneyGram’s biggest rival Western Union ended a year ago, with the company failing to enroll fully on Ripple’s network.
MoneyGram, on the other hand, has seen its profits dwindle in recent times in the wake of increased competition from money transfer startups. The company was almost purchased by Chinese giant Ant Financial but American regulators blocked the transaction. It has since then struggled, with its stock value dropping steadily.
This makes the partnership between the two companies crucial for both. Commenting on it, Ripple CEO, Brad Garlinghouse stated:
“This strategic partnership will enable MoneyGram to greatly improve its operations and enable millions of people around the world to benefit from its improved efficiency. This is a huge milestone in helping to transform cross-border payments and I look forward to a long-term, very strategic partnership between our companies.”
Garlinghouse also spoke to Fortune about the partnership, dismissing claims that XRP has failed to take off in the cross-border money transfer industry for which it was intended. He told the publication that Ripple has continued to partner with more banks, increasing the…