MoneyGram, the World’s Second-Largest Money Transfer Service

Last Updated on October 27, 2021

What is MoneyGram?

Moneygram is one of the most popular money transfer services. Moneygram is an American company that has been in business since 1940.

It is a great service because they can transfer money to more than 200 countries and territories across the world. They even have over 350,000 locations around the globe so you don’t need an internet connection to use their services!

The History of Moneygram

The story of Moneygram begins in the mid-1920s when founder Roy M. Fairchild opened a grocery store in Dallas to support his struggling family after his father’s business went bankrupt during the Great Depression. Fairchild soon discovered that while he was able to accept cash from customers, it would take days for them to send a check or money order through the mail to pay him back. Fairchild decided there should be a faster and more reliable way for people to transfer funds. In 1928, Fairchild established Western Union Telegram & Express Co., which later became Western Union, Inc., an international money services business catering to consumers and businesses alike.  

In 1958, Moneygram International, Inc., was founded by Jep Hindman Sr., who envisioned an easier way to transfer funds across international borders via telegram. Internationally, Moneygram was the first money transfer company to move wire transfers out of banks and into retail storefronts. For decades, customers had few places beyond their local bank branch or post office where they could send funds internationally. Western Union dominated the money transfer business for many years before Moneygram became a competitor in its own right.

In 1969, First National City Bank assumed ownership of Moneygram International, Inc., which led to the formation of First Data Corp. in 1970. For the next decade, Moneygram and Western Union would be run as separate companies before finally merging to form what we know today: The First Data Group.

MoneyGram offers quick access to funds for people who are unable to use traditional banking systems because they live under the poverty line or do not have bank accounts. As one of the world’s largest money transfer companies, MoneyGram gives customers flexibility by allowing them to choose how they prefer to receive their money—in cash or via electronic funds transfer directly into their bank account.

MoneyGram has expanded its business through strategic acquisitions. In 2008, MoneyGram completed the acquisition of Inc., an online provider of currency information to consumers and travelers. With the addition of XE’s resources, MoneyGram now provides customers with access to over 10,000 currency converters as well as up-to-date foreign market spot rates for 200 different currencies.

In 2009, MoneyGram merged with Envoy Data Corporation (Envoy) to create a global remittance powerhouse offering complementary services in both consumer-to-consumer money transfers and commercial payments. The combined company was renamed The First Data Group to recognize their shared heritage while better positioning them for future growth. Under this new umbrella brand, MoneyGram and Envoy both maintain their individual brands.

Today, MoneyGram is a global leader in providing money transfer services via its network of approximately 347,000 agent locations in over 200 countries/territories worldwide. As an industry-leading service provider, MoneyGram has shipped more than 686 million consumer money transfers since 2000 for a total principal value of $99 billion.

Common terms used in money transfer services

When sending or receiving funds with Moneygram here are some terms you will come across:

Agent: An Agent provides an interface between Moneygram services and their customers or vice versa. Agents can be small stores or large international chains such as grocery stores, pharmacies even CVS, Walgreens, etc… The agent location must be registered with Moneygram to process transactions. At the time of registration, you will need to provide your valid identification such as a state-issued ID or Passport along with proof of address.

Customer: A customer is someone who wants to use Moneygram services. Customers send and receive money through different channels each with its advantages and disadvantages as you will learn below. To access the different channels, customers need valid identification as well as a valid bank account or phone number depending on their location.

Fees: Fees will depend on the channel you decide to use or even if you sending or receiving money or both. Usually, fees range from 0-10% of the amount sent and received but there are always promotions going so it would be best to check their website for updates and special offers. NOTE: Be aware of transfer limits before using any service

Direct Deposit: Direct deposit is very quick considering that no agent is involved so in most cases you will have your money in minutes. This option is only available to US residents. Direct deposit requires an American bank account and prior registration with Moneygram.

Wire Transfer: Wire transfers are also very quick usually same day (depends on your agent) but this option is only available for persons that reside outside the United States. Verification requirements vary depending on the sender’s location, contact Moneygram for specifics.

Direct Payment: Customers can make direct payments to certain companies like utility providers or creditors through the use of several options such as cash (US only), credit cards, or debit cards (requires activation). NOTE: The following countries allow direct sending only; Australia, Austria, Canada, Denmark, Germany, Hong Kong, Ireland, Israel, Italy, Japan, Mexico, Netherlands, New Zealand, Norway, Singapore (limited), South Africa (limited), Spain (limited), Sweden (limited) and the United Kingdom.

Mobile Phone Top-up: Customers can send top-ups to mobile phones in over 25 countries including Australia, China, Hong Kong, India, LUXEMBOURG & Portugal.

Ticket Purchase: Moneygram allows customers to pay online for movie tickets or event tickets through Ticketmaster. To complete a purchasing customer will need his/her credit card information bank account number depending on the payment method selected. These transactions are subject to Ticketmaster fees.

Cash Pick-up: Agents can also act as cash pick-up locations. You will need cash at your location to complete this transaction.

Currency Exchange: Customers can also exchange currencies through Moneygram’s Currency Exchange service. They charge a 0% commission fee but the amount must be at least $1,000 USD not including fees (if any). NOTE: This option requires registration with Moneygram prior to using it.

How to Send Money Online

There are several ways to send money online, but MoneyGram provides a safe and secure way of getting your funds where they need. Whether you’re sending international or domestic, the process is easy.

  1. Put together required documentation (including photo ID)
  2. Decide how much money to send
  3. Create a MoneyGram account and choose the receiver’s information (recipient name, phone number or email)
  4. Enter the amount to be sent. Include fees for sending the service you selected. Fees vary by country and can change without notice depending on market conditions such as foreign exchange rates. A receipt will automatically print after your transaction is complete.

The Current State of MoneyGram

Moneygram is getting more popular day by day mainly because it is safe, easy to use, and very cost-effective. As compared to other money transfer companies like Western Union, Moneygram allows you to send money through any of its worldwide offices even if the receiver has not enrolled with them.

The problem with Money Gram is that there are no guarantees that your family member or friend will receive the money in time before closing hours of their branch office unless he/she goes there personally for claiming the amount. Transferring process becomes much harder if the receiver doesn’t have an identification document that can be used as proof to get the transferred amount.

Another drawback associated with Moneygram is that it doesn’t give you an option to transfer online payments directly to the receiver’s bank account in many countries like India, Pakistan, etc. You need to take the help of another method of payment for this purpose.

Why You Should Use MoneyGram For Your International Transfers

MoneyGram is an interesting case. They claim to be one of the largest money transfer companies in the world, but really they are mostly limited to North America and Asia (and not even all countries within those areas). Their network rivals that of Western Union, but with a lower fee schedule.

So why would one want to use this company over Western Union or other more established options? The answer is simple: You can send relatively small amounts for free or you can pay pennies per $1000 transferred with MoneyGram compared to WU’s $5 + 5% charge on each transaction. This makes MoneyGram very useful for making transfers unlikely to pass the limit on your bank-issued credit card.

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