It may seem like ages ago, but back in 2009 the iPhone, along with other fast-moving technologies, was taking the world by storm and changing various industries in its wake.
That same year, MoneyGram CEO Alex Holmes was just settling into his new role as senior vice president of Corporate Strategy and Investor Relations. MoneyGram, a long-standing fixture in the money transfer and remittance landscape, was, at that time, a largely physical network. A pretty important one that people used to reliably and securely send money to family members from one country to the next – with great frequency – but digital was a nascent part of the business at that time.
Seven years later, Holmes tells Karen Webster that MoneyGram is a vastly different company than the one he joined in 2009.
“It’s no question the evolution of technology and mobile, as well as the distribution of it globally, has had an absolutely phenomenal impact on our business,” Holmes expressed.
For MoneyGram’s business and for the global remittances business industry as a whole, the onset of digital has fostered new competition and a new way of thinking about the products and services provided – and how those offerings are distributed around the world.
It has also created increased the company’s efforts to fundamentally change the perception of MoneyGram.
A New Attitude
Holmes, therefore, is on a mission. One that breaks apart the myths that surround MoneyGram as an “older cash-based business” and instead one that’s effective at blending the digital and physical space in an omnichannel way.
Myth No. 1: Moving money around the world is something anyone can do.
Holmes says that many tend to oversimplify and underestimate the level of effort that goes into enabling someone to send money to anyone, anywhere in the world in any way that they want to receive it.
The common denominator – the need for a person in one country to send money to a loved one in another – belies the complexity that lies beneath. Those people don’t care that MoneyGram is accepted in 200 countries – they just want to be able to send money in their native currency the way they want to send it – to someone else in another country so that they can get it in their native language and currency.
And to do it while maintaining compliance across all of those jurisdictions.
And making it seem like, to those senders and receivers – for which this is the most important thing they will do that day – and possibly that month – that it happens quickly and securely and simply.
Which if anything but simple to deliver, Holmes acknowledges “needs to be a clear and easy transaction for them to do."
More Than Just Cash
Myth No. 2 is that all MoneyGram does is cash – and that consumers aren’t really using cash anymore.
On the one hand, that’s not surprising.
Historically, MoneyGram’s consumer demographic has included what Holmes describes as real, true users of cash.
And given the pace of technology’s adoption curve and the adoption of mobile phones and digital payments technologies, many assume that the utility and usefulness of cash is diminishing.
But Holmes said this couldn’t be farther from the truth.
Though there are plenty of global developing markets that have seen success with the rise of mobile offerings, many overlook the role that cash still plays in those transactions and in emerging economies, overall.
“MoneyGram plays a huge role in the globalization of the world – the flattening of the world and technology has actually opened up that market much more broadly to a larger consumer demographic than we've ever had access to before,” Holmes said.
For instance, Holmes points outs, a person in the U.K. that may use a mobile device to initiate a remittance to a loved one in Kenya still needs to find an agent to convert that remittance to cash to spend in their village.
Even though MoneyGram is expanding its digital products and services, one of its core differentiators is the physical cash agent network that gives consumers the ability to transfer money on a cash-to-cash basis, a cash-to-digital basis, a digital-to-cash basis or any number of permutations in-between.
Making The Digital Dash
Which brings us to myth No. 3: Since MoneyGram deals primarily with cash, they haven’t kept up with the great technology surge that is now defining how payments between all parties are being conducted.
“The great misperception that I think permeates throughout the industry and probably into MoneyGram to a large degree, is that because we do a lot of cash-in and cash-out in our business, we're somehow antiquated and not a progressive technology-type company,” Holmes explained.
Holmes said that MoneyGram feels good about the physical side of its business. The challenge now is continuing to enhance the digital side in order to drive repeat transactions and repeat customers.
“We are opening up our network in a way that is going to allow a more dynamic interaction and much more dynamic transactions for all our customers," he added.
In fact, he emphasized, the ability to support digital interactions – transacting online, into bank accounts, into mobile wallets – cross border, securely and within the regulatory, language and currency constructs that more than 200 different countries require — with cash thrown in the mix of it all — requires a great deal of tech savvy and capabilities. That's something that Holmes says is “very under appreciated” about MoneyGram right now.
“We want to give them more choice and we want to be able to talk and communicate with our customers in that omnichannel space,” he added.
Holmes acknowledges that technology has given rise to a number of new players who now find it easier – at least technically – to enter the market. And, they’re doing it not by being in 200 different countries and currencies, but by picking off one, two or a few corridors that drive volume for them – and take volume from MoneyGram.
But Holmes, who welcomes competition and the pressure that comes with it to challenge the status quo, says he loves MoneyGram’s position in the market because of its ability to serve a customer who just wants to get money to their loved one in need.
That, he says, is what has focused the firm on making sure that in that sea of competitors, MoneyGram is always giving consumers a reason to pick them over the competition.
And Holmes believes the company has the right plans and assets to deliver.
MoneyGram will be rolling out changes to its product set, systems and the ways in which it interacts with customers — all with the hope of driving a new perception among its customers that will help to keep MoneyGram top of mind when they need to send or receive money.
Plus, Holmes said, some of the “secret sauce” that even the slickest technology can’t deliver: customer trust and brand affinity.
"We want to be viewed as a much more tech-savvy company in the FinTech space and not just with an old cash-to-cash kind of mentality," he said. “To deliver a true ‘omnichannel’ experience for our customers – giving them the optionality to transact any way and anywhere they want, means that we really have to be on our technology game – and then some.”