The global head of product and innovation at MoneyGram is a big believer in cryptocurrencies and has even said that they represent the future of how the general public will move money across borders.
For those that don’t know, MoneyGram International Inc. is a money transfer firm that is based in the US with headquarters in Texas. The head of product and innovation, Youri Bebic says it’s “highly probable” that crypto is the future of finance.
Last year, MoneyGram announced a partnership with Ripple in order to test the digital asset’s ability to lower the cost and increase the speed of payments. Bebic spoke to the Institutional for Robotic Process Automation and AI that the results of the test showed the massive potential of crypto in the world of finance.
Bebic says that value isn’t really shifting across borders when someone sends money across the world. Instead, firms pre-fund banks accounts in nations internationally to be able to power the global remittance industry.
“We did a proof of concept with one cryptocurrency. We made a press release so I can answer that. That was with Ripple, where we are trying to see if we can use cryptocurrency for liquidity in the markets.
Because the big secret with money transfers is the money doesn’t move. The money’s already there. We pre-fund pretty much in bank accounts all over the world and then we do value transfer. But if I were to send money from here to Mexico and literally, physically move the money at that time, it would take a lot of time.”
The way things stand could change with cryptocurrencies. Bebic says that by making it really possible to send value across borders in an instant without needing to utilise pre-funded bank accounts. Even so, the liquidity of crypto assets is a big issue that still needs to be overcome.
“So cryptocurrency, if they all add scale, and if the markets are there with liquidity, could actually allow us to eliminate pre-funding of fiat, what we call regular currency in a particular country, and then use the exchanges to sell cryptocurrency against local currency and deposit that into the bank account or give it in cash for our user. So, we are obviously looking into that. We are running some pilots and trials.
And I do believe it is highly probable that this is the way money will move in the future. There is still a lack, again, of liquidity, and some markets are more advanced than others. We deal with a lot of exotic currencies… in Africa, for example, where I don’t see cryptocurrency really being traded in the near future. But in many places, like in Europe, like in Asia, it could actually be possible, and if it takes off we want to be a part of it.”