Speaking with CoinTelegraph, MoneyGram Executive Vice President (US & Canada) Peter Ohser answered some FAQ’s about MoneyGram’s business model. He also fielded inquiries about Bitcoin, which many believe poses a serious threat to traditional remittance services like Western Union and MoneyGram.
He described how the company charges 1% of the amount sent, up to $1000. Beyond that, the percentage actually increases to 2%, due to KYC considerations and involvement of partners. He noted that all fees are transparent- what you see is what you get.
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So does Bitcoin pose a serious challenge? Services like Rebit have promoted themselves by illustrating the savings realized when sending remittances through them. Ohser argued that Bitcoin isn’t genuinely being used for remittances today and that its use is more hypothetical. As to its ‘frictionless’ properties, he continued:
“But increasingly as you start to scale a business and really look at remittances at scales on a global basis, all of the things that Bitcoin stands for will get complicated because of the structure of having to know your customers and be able to track and live under the regulations that governments are forcing you to live by, [which] start to diminish the benefits that Bitcoin does. The frictionless becomes more frictional and that’s where we see the challenges with this model.”
He did note, however, that MoneyGram “has been watching Bitcoin from an industry perspective since [its] rise.”