Bitcoin is poised to disrupt the financial sector, and money remittance services will be among the first to feel the wrath of borderless digital currencies. Servers like Western Union and MoneyGram are the top contenders in the remittance sector, yet that paradigm might be about to shift sooner rather than later. That being said, MoneyGram isn’t feeling the pressure just yet.
MoneyGram Feels Bitcoin Isn’t What People Want
If it were up to companies like MoneyGram, Bitcoin would never be a threat to its remittance service in any way. Sending money around the world at low to no costs sounds very appealing to customers, yet they aren’t flocking to Bitcoin and digital currency en masse just yet.
“If you could actually leverage [bitcoin] the way people want, we’d be there.” – MoneyGram Vice President of Business Development Peter Ohser stated.
Even though there have been attempts to disrupt the remittance service before, none of those efforts have been successful as yet. In fact, more and more companies are relying on the same old traditional payment methods to send funds around the world. Consumers take the associated costs for granted without giving it a second, though.
According to the MoneyGram spokesperson, people will always want access to cold hard cash in the end, which is exactly what their service provides. One thing this person fails to realize is how this cold hard cash comes from central banks, and they can shut down that stream of funds at any time without prior notice.
Which brings us to the main benefit of remittance services: they provide access to cash in countries where capital controls are a rule rather than an exception. However, those capital controls are also applicable to remittance service providers like MoneyGram and Western Union, even though they will be among the last parties to feel the threat of this scenario.
“Payments are already digital and real time. I can send cash using the existing rails. It’s there, and it’s real. [Digital currency] is not solving a problem … There’s also a trust factor. People trust paper more than they trust data, and that behaviour is not going to change.” – Peter Ohser of MoneyGram continued.
There is a valid point being raised here, as far too many everyday consumers put their faith in paper money, which has no intrinsic value, nor a supply cap. Every bill of fiat currency being kept or used is backed by absolutely nothing, other than a promise by central banks for this bill to represent the value printed on the front and back.
Bitcoin’s Marketing Machine Needs a Kick Up The Rear
Scalability is not an issue Bitcoin is facing just yet, ever since the block size debate quietened down a few weeks ago. Additionally, the underlying blockchain technology can scale to a global level whenever needed, without bogging down the Bitcoin network at all. That being said, Bitcoin acceptance remains a key problem.
To drive Bitcoin acceptance forward, more consumers need to be made aware of the benefits Bitcoin brings to the table. As consumer demand for Bitcoin grows, more stores and other services will start to accept digital currency payments. Saying how Bitcoin solves “no pressing issues” is a clear example of how single-minded some people can be, even when a proper solution is staring them in the face.
Last but not least, when someone says how people “trust” the fiat currency they know, things go from bad to worse. MoneyGram’s Peter Ohser is a power-hungry egomaniac who will not relinquish the centralized control his company has. Being critical of innovative platforms making every individual in the world a money remittance kiosk is “misguided” in his opinion.
Things are evolving, Mr. Ohser, and it is time you and your company start doing the same before both become completely obsolete.
Images courtesy of Shutterstock, MoneyGram