Bloomberg has revealed that Western Union is making a proposal to buy MoneyGram. Both Western Union and MoneyGram are financial systems by which individuals can send money across countries and continents. Western Union can also be used to send money within a country.
Western Union wants to increase their capacity for cross-border payment solutions by acquiring MoneyGram.
An article on Bloomberg dated June 1 revealed Western Union’s intention. If this happens, it will be the merging of the two biggest money-transfer agencies in the US and probably the world.
Inconsistencies during the Pandemic
MoneyGram has suffered a lot in this coronavirus pandemic because people no longer find the opportunity to go out and make money. This has affected the amount of income people make such that they are not able to send money across borders as usual. Consequently, most MoneyGram branches both within the US and abroad have been closed.
In addition, the lockdown has made people to discover smarter ways of sending money across borders. They now use online payment systems which they find fast and easy. Digital payment systems have done better than 18% which it recorded in the first quarter of 2020 but on the other hand, MoneyGram’s relevance has been waning since January although it partnered with Ripple.
Western Union is currently more buoyant than Money Gram. Western Union’s market cap is around $8.2 billion while Money Gram’s is $155 million.