Customers will deposit or withdraw funds using their wallets at MoneyGram service providers
MoneyGram, a US-based cross-border payments and money transfer services company, has announced a partnership with Stellar in a deal that will see customers access account funding and withdrawals via the USD Coin (USDC) stablecoin.
The partnership has been struck with the Stellar Development Foundation, a non-profit organisation behind the Stellar Network's development. It also incorporates payments firm Circle's USDC, allowing for near-instant settlement of financial transactions via the stablecoin.
The deal also includes United Texas Bank, an FDIC-insured commercial bank that will provide transaction settlement within US banking regulations.
Seamless conversion from fiat to USDC
Customers are set to benefit from seamless money conversion, either from USDC to the local currency or from cash to USD Coin, the company said in a press release.
Denelle Dixon, the CEO of the Stellar Development Foundation, noted that the partnership enhances the role of blockchain technology in financial services and that it could see more people benefit from a service not previously accessible to them. She added:
"Thanks to the reach of MoneyGram's services and the speed and low cost of transactions on Stellar, a new segment of cash users will be able to convert their cash into and out of USDC, giving them access to fast and affordable digital asset services that may have previously been out of reach."
MoneyGram Chairman and CEO Alex Holmes pointed out the growth in cryptocurrencies and stablecoins, commenting that the ecosystem had the potential to "streamline cross-border payments".
"Given our expertise in global payments, blockchain, and compliance, we are extremely well-positioned to continue to be the leader in building bridges to connect digital currencies with local fiat currencies," Holmes added.
MoneyGram will roll out the services across select locations by the end of 2021 before going live globally in 2022.
MoneyGram's partnership with Stellar comes months after the company halted its cooperation with Ripple, the company behind the XRP cryptocurrency. The move to suspend ties with Ripple followed the US Securities and Exchanges Commission’s (SEC's) case against Ripple Labs and top company executives. The case is ongoing.
For a deep dive into the Stellar cryptocurrency check out our full Stellar Lumens guide.