MoneyGram is currently amongst the most significant payment transport providers from the Earth, next only to Western Union. Now, you’ll be hardpressed to locate a nationstate which isn’t served by MoneyGram, subsequently illustrating its global mite.
Sending cash via MoneyGram is a service most commonly used by those looking to transfer money to the third world. However, as MoneyGram also permits bank account transfers, it’s potentially suited for developed economies too.
If you’re thinking about using MoneyGram to send or receive funds internationally, then be sure to read our comprehensive guide before all else. We’ll cover everything from fees, payment options, safety, how transfers work, and more.
What is MoneyGram?
In its most basic form, MoneyGram is a payment transfer provider that facilitates international money transfers. Launched way back in 1940, the company is based in Dallas, Texas. Although other options do exist, the traditional process of sending money through MoneyGram is as follows.
- The sender will walk into their nearest MoneyGram store.
- After filling in a document outlining the payment instructions, the sender will hand over the cash to the MoneyGram agent.
- As the third party in the transaction, the agent will then authorize the transfer via the MoneyGram network.
- The receiver’s nearest MoneyGram kiosk will then get the all clear to release the funds.
- When the receiver walks into their local kiosk, they will show some identification, before the agents hands over the cash.
In return for facilitating the above transfer, MoneyGram receives a fee.
Although the above process sounds highly outdated, MoneyGram has a network of significant size. The organization claims to have more than 350,000 agents worldwide, serving more than 200 different countries. However, in terms of its status as a leading blue-chip company, this is no longer the case.
With an all-time high marketplace financing of just under $1 billion in 2017, the company has after all been on a downward spiral. At the time of writing in May 2019, the company has a marketplace financing of just $189 million.
One of the key problems facing MoneyGram, and as we’ll discuss further down, is that there are now far easier, cheaper and more efficient ways of transferring money overseas. With that being said, the key segment of the marketplace that MoneyGram is looking to hold on to is a remittance of funds to the third world and emerging economies.
This is because access to traditional banking services in remote locations are still somewhat limited, and thus, MoneyGram still has a relatively strong presence.
So now that you know what MoneyGram is, let’s take a look at how the transfer process works in more detail.
How Do MoneyGram Transfers Work?
As noted above, MoneyGram acts as a third party intermediary medially senders and receivers. Although its main business model is facilitating cash transfers in-person, the company has after all diversified into four other areas.
Notably, this includes sending money online, sending money directly to bank accounts, sending money to a mobile wallet, and perhaps, most interestingly, sending money to prison inmates!
Before breaking these key target stores down, let’s explore its most traditional model — in-person transfers.
- Your before all else port of call is to find your nearest MoneyGram location. There are in the region of 350,000 kiosks located across more than 200 nations, so you shouldn’t be overly much out of the kiosk.You may uncover your closest MoneyGram kiosk the following.
- Once you’ve discovered your closest kiosk, then you’ll want into this spot in-house. You’re going to have to complete a record about the amount of money move you need to perform.This should comprise your total name, the title of this receiver, the receiver’s spot, and also the sum which you wish to ship, and penalties.
- In order to obey AML (Anti-Money Laundering) along with KYC (Know-Your-Customer) regulations, then the MoneyGram representative will have to have a replica of one’s federal government issued ID.This may be passport, driving permit or federal ID card.Once you control the transport level of money, and the MoneyGram broker will provide you a 8 digit PIN amount.
- You will afterward must supply the 8-digit PIN quantity to this individual you’re delivering the amount of money way too. Based upon the positioning acquiring the amount of money, the move could require no more than 10 seconds to method.
- The receiver will subsequently will need for their own regional MoneyGram kiosk, hand across the 8-digit PIN range and also the quantity which has been moved. Additionally they will have to exhibit a few identification, so therefore be certain that this matches with the info that you placed to the initial form.Finally, the moment the getting broker verifies that the move, the receiver will probably be given the bucks.
If you overlook’t feel like ing your local MoneyGram kiosk in-person, you can instead transfer funds online. The process is largely the equal as the in-person method, insofar that you will need to fill in an online form detailing information about you and the receiver, as well as the amount being transferred.
In terms of payment options, you can use either a debit or credit card, with MoneyGram accepting Visa and MasterCard only. Take note, if you are using a credit card to transfer funds, it is likely that your credit card company will categorize the transaction as a cash advance.
Alternatively, if you are based in the U.S. and sending money overseas, you can use a domestic checking account.
MoneyGram will attempt to verify your information online by using third-party sources. However, if they are unable to do this, your payment will remain on hold. It is likely that the team at MoneyGram will contact you via telephone in an attempt to verify your information.
Once your details have been confirmed, you will be given an 8-digit PIN number, which you’ll then need to pass on to the receiver.
Transfer to a Bank Account
MoneyGram also allows you to send money directly into the receivers bank account. You can do this both online and in-person. However, the fees are somewhat expensive when performing a bank transfer via MoneyGram, so we would suggest using an alternative provider.
Transfer to Mobile Wallet
A new option available to MoneyGram customers is to send money to a mobile wallet. This is especially popular in the third world, where the mobile payments industry is booming.
Examples of supported MoneyGram wallets include M-Pesa (Tanzania and Kenya) and Econet (Zimbabwe). Once again, you can process a MoneyGram mobile wallet transfer online or in-person.
Transfer to an inmate
If you’re based in the U.S. and would like to send money to an inmate, you can now do this via MoneyGram.
Supported correction facilities includes the Texas Department of Criminal Justice, Florida Department of Corrections, California Department of Corrections and Federal Bureau of Prisons.
The sending process works in the equal way as the other MoneyGram services we have discussed, although you will need to supply the inmate’s correctional ID.
While MoneyGram is proficient in the services it offers, one of the most important factors to consider is the fees it charges. There is no’one-size-fits-all’ answer to this, as fees can and will depend on a number of factors.
- The location that you are sending the funds to
- The type of payment transfer you opt for (in-person, online, etc.)
- The number of funds that you are sending
- Whether the transfer requires more than one currency
The best way to break the fees down is to look at a couple of examples.
Firstly, if you were to send 500 from the UK at an in-person kiosk to somebody in Vietnam, you would pay a fee of 17.90. Sending the equal transfer online would cost 8 in fees. Using a specialist online transfer provider like TransferWise would cost significantly lower.
In a second example, sending 500 from the UK to a receiver in Kenya would cost 18.99 in fees if you were to process the transfer in-person.
The very equal MoneyGram transfer online would cost just 6.90.
As such, it appears that using the in-person MoneyGram service is substantiall
y higher than transferring the money online.
This ambiguity in pricing is further amplified by Investopedia, who state that:
“MoneyGram’s speeds for international money transfers usually don’t look many less difficult than people Western Union. You may transport $500 into Mexico, utilizing a debit or charge card, even to get a $9.99 commission, nevertheless the exact equal trade expenses $31.00 in the event the amount of money is currently chosen in Ireland, also $49.99 in case it belongs to China. “
Therefore, the only way to truly ascertain whether a MoneyGram transfer is financially viable for your chosen destination, amount, and preferred payment method, is to use the MoneyGram pricing calculator.
MoneyGram Exchange Rates
If you are looking to use MoneyGram to send funds overseas, then it is likely that you will need to make some considerations regarding exchange rates. The exchange rates implemented by MoneyGram can vary widely. In most cases, this will depend on the specific currencies being used in the transfer.
For example, if you are utilizing two major currencies — such as GBP, EUR or USD, then you can expect the rates to be more favorable. On the other hand, if you are sending money to an emerging nation, and thus, require the usage of an exotic currency such as the Kenyan Shilling, then expect to pay higher fees.
Much like in the case of its transfer fees, MoneyGram is somewhat opaque when it comes to the exchange rates that they use. They essentially bundle this within their’allin’ transfer rate, which again, varies depending on the previously discussed factors.
Upon delving deeper into the terms and conditions of MoneyGram, it appears that the provider charges a variable rate above that of the mid-market rate. Third party sources claim that this can be as high as 5%, which is extremely expensive.
When looking at key competitors of MoneyGram, the likes of OFX are many more transparent when it comes to exchanging rates. Specifically, OFX charges an average of just 0.4% above the mid-market rate.
So now that we’ve discussed pricing, in the next part of our MoneyGram review we are going to explore whether the payment provider is safe.
Is MoneyGram Safe?
MoneyGram is an established money transfer provider with a track record that spans seven decades. In terms of the company’s regulatory status, MoneyGram is regulated and authorized by the UK’s Financial Conduct Authority (FCA) as a money transfer service provider. In this respect, using MoneyGram for your international remittance needs is as safe and secure as it gets.
However, many like in the case of its Western Union counterpart, MoneyGram is used widely by scam artists as their preferred payment method. The key comprehension for this is that once the funds have been sent, and subsequently collected, there is no recourse in the event of fraud.
Moreover, even if you take the matter up with your local Police authority, there is little that they will be able to do, not least because of the trans-national nature of the crime.
This is somewhat interesting, not least because the receiver is required to provide the MoneyGram collection agent with a suitable form of ID. However, whether this is enforced in emerging nations — especially those based in rural locations, remains to be seen.
Ultimately, if you are ever requested to a send payment to an unknown third party via MoneyGram, you should tread with extreme caution. Such a scenario is even used by rogue landlords who request payment up front via MoneyGram, prior to the end-user actually viewing the property.
MoneyGram Mobile App
MoneyGram now offers its user a native mobile application which is available to download for free via both the Android and iTunes store. The application works in many the equal way as the online version. Users can send funds, upload a payment method, find their nearest MoneyGram agent, check previously sent transfers, and more.
However, upon researching online reviews available in the public domain, it appears that the MoneyGram app is riddled with bugs. With an iTunes rating of just 1.9 (out of 5), the general consensus is that the app constantly freezes, forcing users to restart their money transfer process from the very beginning.
How Long do MoneyGram Transfers Take?
One of the best aspects of using MoneyGram for your international transfer requirements is that processing times are usually very quick. Once again, this can vary depending on a number of factors, such as the location, and whether you are performing an in-person or online transfer.
Nevertheless, in the vast majority of cases, in-person transfers are usually received by the end-user within just 10 minutes. This makes it significantly faster than most other money transfer services that rely on a bank-to-bank system. However, as noted earlier, in-person transfers are many more expensive than paying online.
On the other hand, MoneyGram transfers that are processed online, although a bit slower, are sometimes received within a few hours.
The great thing about sending funds online via MoneyGram is that you can trace the end-to-end transaction. As such, you can estimate how long it will take for the funds to arrive in the receiver’s bank account.
So now that we’ve covered estimated transfer times, in the next part of our MoneyGram review we are going to see what other services the company offers.
What Other Services Does MoneyGram Offer?
Although the vast bulk of the MoneyGram business model is centered on international money transfers, the company is also involved in other products and services. The key comprehension for this is that the MoneyGram management team recognized that they need to diversify in order to react to more cost-effective marketplace competitors.
Pay Bills via MoneyGram
One of the fastest growing MoneyGram side-services is that of its online bill payment offering. The service can be used to pay bills across thousands of companies, including utility and phone companies, government agencies, and even healthcare providers.
In order to pay a bill via MoneyGram, you need to provide the company’s name, and your specific account number (linked to the bill issuer).
If paying online, you can use either a debit or credit card. However, if you have access to traditional debit/credit cards, it remains to be seen why you would want to use a third party like MoneyGram, especially when one considers that the fees are going to be many higher.
On the other hand, if you don’t have usage of a charge , subsequently your MoneyGram charge payment agency is equally good, since you are able to pay excellent invoices on-the-go in a MoneyGram kiosk.
MoneyGram Money Order
If you have to send out some body a national payment and then overlook’t want to perform a bank transfer, then you can utilize the MoneyGram Money Order service. In a nutshell, all you need to do is walk into your local MoneyGram store, hand over the required amount in cash, and then MoneyGram will provide you with a physical Money Order.
Such a service is also useful for those that do not have access to a traditional bank account. Unlike checks, Money Orders can be cashed at a full range of locations, such as a post office, or another MoneyGram location (domestic only).
Pre-Paid Card Top-Up via MoneyGram
If you are currently using a pre-paid debit card, then you’ll be pleased to know that you can use MoneyGram to load your card up. This is especially useful if you are looking to use your pre-paid card for an upcoming holiday, and need to add some additional funds to your card.
You won’t be in a position to get this done internet, which means that you’ll want cer
tainly to a closest MoneyGram kiosk.
All you want to do will put your prepaid card to your MoneyGram retail store and cover the broker that the mandatory requisite sum (and penalties ), after which MoneyGram will approach the entire trade for your benefit. A few MoneyGram destinations also acknowledge bank card residues to your own prepaid card card topup support.
MoneyGram Mobile Top-Up
An extra service provided by MoneyGram is because of its cellular topup centre. MoneyGram supports significantly more than 350 distinct cell providers positioned in more than 100 states.
Although this wouldn’t really be suitable for topping up a domestic phone number, the service is great if you want to top-up the mobile of a family member or friend located overseas. MoneyGram claims that the end user usually receives the top-up within a few minutes, which is really efficient.
You won’t be capable of using this distinct MoneyGram assistance , which means that you’ll want to perform this on line.
All you want to do is input the recipients cellular phone supplier, their cellular quantity, then pay using a debit card or debit card. Don’t forget, if you use your credit card, your card issuer is likely to process this as a cash advance.
MoneyGram Review: The Verdict?
In summary, MoneyGram has been offering international remittance services for the best part of seven decades. In fact, they sit just beneath Western Union as the largest money transfer service provider in the world. With more than 350,000 MoneyGram agents located across over 200 countries, you’re never too far away from a supported kiosk.
However, the key issue with a service like MoneyGram is that the company now faces fierce competition from more modern international remittance providers that utilize more efficient processes.
As such, if you are looking to perform an international bank-to-bank transfer, you might be better off using an alternative provider like OFX or TransferWise. Not only will this be cheaper, but in most cases, faster.
On the other hand, MoneyGram excels in its in-person transfer service, which forms the core root of its business model. If you need to send funds to somebody located in an emerging or before all else world nation that doesn’t have usage of a conventional banking accounts, subsequently your on site option is best.
Arguably the agency is costlier than by using a bank-to-bank transport, but finances are often obtained in under 10 seconds.
Ease of Use
- Very Fast Transfers
- Worldwide Access
- Lots of Payment Options
- Cash Installments
- Long History & Well Established
- Fees may Be High
- Fees Vary Extensively
- Negative Reviews on the internet