MoneyGram International, Inc. MGI, a global provider of innovative money transfer services, has announced the launch of a new debit card deposit service in partnership with Visa to ease person-to-person (P2P) money transfer. The agreement involves the use of Visa Direct, Visa's real-time push payments platform, which enables payments to over a billion cards worldwide.
The P2P money transfer option allows customers in the United States to conveniently send money domestically through the MoneyGram app or via the MoneyGram website to other U.S. recipients' bank accounts linked to eligible Visa debit cards. The service is currently available only in the United States.
With the roll out of this service, MoneyGram ensures that its customers have easy and convenient ways to transfer cash.
The current agreement is an extension of the one signed between Visa and MoneyGram in July to modernize and digitize the process of sending and receiving money overseas, on a real-time basis, by utilizing Visa Direct. MoneyGram is the first cross-border use case for Visa Direct,
MoneyGram is optimistic about Visa's platform and the superior services of these companies have huge potential to further transform its cross-border business.
The coming together of Visa and MoneyGram points to their intent in making it big in the expanding P2P payments market, which is highly dominated by cash and checks. Real time P2P is attracting huge customers due to the widespread use of mobiles to make transactions.
The offering of real-time P2P payment services along with Visa will help MoneyGram to fight against rising competition from players such as Paypal, Zelle and Venmo.
The agreement with Visa is one of the many measures that MoneyGram has undertaken recently to turnaround its business to profitability after revenue declines in 2017 and 2018. Also, in 2018, its earnings fell 46.5% year over year.
Several initiatives such as loyalty program, referral programs, new app and website, win back campaigns, progress/opportunity with Ripple, and significant cost cuts should aid the company’s earnings.
Year to date, the stock has gained 166% compared with its industry’s growth of 21%.
MoneyGram currently carries a Zacks Rank # 3 (Hold). Some better-ranked stocks in the same space are Globe Life Inc. GL, Houlihan Lokey, Inc. HLI and Fortress Transportation and Infrastructure Investors LLC FTAI. Globe Life and Houlihan Lokey currently carry a Zacks Rank #2 (Buy) and surpassed earnings estimates in each of the trailing four quarters by 2.24% and 18.96%, respectively.
Fortress Transportation and Infrastructure sports a Zacks Rank #1 (Strong Buy) at present and has an earnings beat of 71% for the last reported quarter.
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