MoneyGram financial report classifies $11.3m received from Ripple as ‘contra expense’

Written by

Updated on Jun 29, 2024

Reading time 2 minutes

MoneyGram's revenue in 2019 now excludes $11.3 million that the company received from Ripple.
The money transfer service's total revenue is significantly lower than in 2018,
while Ripple claims that the last year was its strongest to date.
Right now, the funds are considered as an offset to operating expenses, and are no longer considered revenue

MoneyGram, a major money transfer service, became one of the largest partners of a crypto startup, Ripple. The company has since gained a lot of attention due to its partnership with the crypto firm, and its use of Ripple’s international payment products.

According to a recent report on MoneyGram’s financial results involving the last year, as well as Q4 2019, there was a receipt of a total of $11.3 million in the last quarter of the year, coming from Ripple. Not only that, but MoneyGram also seems to have received $2.4 million in Q3.

MoneyGram already saw a decline in revenue last year, and this move will decrease the revenue even further. According to the official press release, the company’s total revenue of $1,285.1 million had declined by 11% on a reported basis. There is also a further decline of 10% on a constant currency basis, as compared to the situation in 2018. Meanwhile, the $11,3 million received from Ripple is now considered ‘contra expense.’

Ripple’s history with MoneyGram

As some may remember, Ripple originally announced its partnership with MoneyGram back in June 2019. Since then, MoneyGram started leveraging Ripple’s XRP coins in order to make instant international transactions in the Philippines, Europe, and Australia.

Before that, Ripple invested $30 million in the company, at the same time when the two signed a commercial agreement for settling international transactions by using crypto. Ripple also purchased $20 million of the company’s equity for $4.10 per share in November.

After the deal was made, Ripple became an owner of 9.95% of MoneyGram’s common stock, while it also became an owner of almost 15% on a fully-diluted basis, which includes non-voting warrants. Further, the crypto startup also stated that 2019 has been its strongest year involving growth to date.

The company has more than 300 customers around the world, and it raised over $200 million in a Series C funding round, which increased its value to $10 billion.