RIPPLE PAID MONEYGRAM $9.3 MILLION IN Q3 OF 2020.

According to the report published by Moneygram concerning their financial results for the third quarter of 2020, Ripple paid Moneygram $9.3 million.

Moneygram which is one of the world’s largest money transfer company based in the united states with it headquarters in Texas as release their financial report for the third quarter of 2020 which is between the month of July to September.

MoneyGram according to Nairametrics is a global leader in cross-border P2P payments and money transfers. Its consumer-centric capabilities enable family and friends to quickly and affordably send money in more than 200 countries and territories, with 81 now digitally enabled.

Ripple on the other hand according to Wikipedia is a real-time gross settlement system, currency exchange, and remittance network created by Ripple Labs Inc., a US-based technology company.

The $9.3 million paid to Moneygram was described as the market development fee and not revenue as it was paid in compensation for providing liquidity to Ripple’s On-Demand Liquidity (ODL) network which enables Ripple (XRP) cryptocurrency send money across broader.

However, the $9.3 million incentive was paid in XRP which left a profit of $8.9 million as $400,000 was removed for all related transactions and other expenses.

Earlier this year, Ripple paid its partner MoneyGram $15.1 million in XRP as incentives for the market development fee in the second quarter of 2020.

Comparing the third quarter with the second quarter, MoneyGram received $5.8 million lesser from Ripple in Q3.

MoneyGram had earlier revealed its Q2 earnings report which Ripple paid $15.1 million, but $6.3 million was calculated as expenses for transaction and trading, giving the company a profit of $8.8 million.

A spokesman from Moneygram said earlier this year that While Monegram may receive incentives from Ripple, we do not hold the XRP digital asset as we sell XRP as fast as we receive it.

Moneygram and Ripple came into partnership in June 2019 to help XRP in forex contracts as part of MoneyGram’s cross-border payment process, based on the agreement, Ripple invested $50 million in Moneygram and their agreement is said to expire in three years time from now which is by 2023.

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Moneygram Q3 Financial report

Below are some of the financial reports as recorded on the Moneygram International report Q3 2020.

• Total revenue was $323.2 million, representing a slight increase on a reported basis or -1% on a constant currency basis
  • Money transfer revenue was $297.6 million, up 5%, or 4% on a constant currency basis, driven by the strength of our digital business
  • Investment revenue was $3.0 million for the quarter representing a decline of $10.4 million due to lower prevailing interest rates
• Total operating expenses of $286.6 million, improved $19.2 million or 6%
  • Transaction and Operations Support expenses decreased $31.5 million or 56% which included:
    • Agile management of expenses through the pandemic as the Company continues to benefit from its Digital Transformation
    • $8.9 million net benefits from Ripple market development fees of $9.3 million, partially offset by related transaction and trading expenses of $0.4 million
    • The Company recorded $6.3 million in foreign exchange gains primarily related to currency movements during the pandemic
• Operating Income was $36.6 million, an increase of 123% year-over-year
  • Operating Income margin expanded from 5.1% to 11.3% year-over-year
• Net Income was $10.9 million for the quarter representing a return to positive net income for the Company and an increase of $18.6 million
• Diluted earnings per share were $0.12 and diluted adjusted earnings per share were $0.16
• Adjusted EBITDA increased 33% to $68.8 million, or 29% on a constant currency basis
  • Adjusted EBITDA margin improved 530 basis points to 21%
• Adjusted Free Cash Flow was $25.4 million, an increase of 173%.

Holmes concluded: “Amidst the ongoing global pandemic we have been able to consistently deliver strong results. The focused execution of our strategy and agile management of the business will continue to enable the Company to successfully navigate this uncertain environment.

Cash and cash equivalents on hand at quarter-end was $162.9 million compared to $130.6 million at the end of the second quarter of 2020. Third-quarter interest expense was $23.0 million and capital expenditures were $10.7 million.