MoneyGram profits from mainframe move to multicloud
MoneyGram is also entering new markets as it modernizes, partnering with Stellar Development to engage in the crypto-currency space with an eye toward allowing customers globally to buy and sell crypto-currency and convert currency to crypto and vice vers
MoneyGram is also entering new markets as it modernizes, partnering with Stellar Development to engage in the crypto-currency space with an eye toward allowing customers globally to buy and sell crypto-currency and convert currency to crypto and vice versa.
A third area of focus is fighting fraud and ensuring regulatory compliance. For example, MoneyGram is using analytics to ensure that businesses using its service are licensed. One major benefit to date is flushing out fraudsters and detecting anomalies, especially important in complying with various global regulations.
“It’s a constant game of cat and mouse,” Vaughan says of fraud and stolen identities. “As we got digital, managing fraud can be challenging, even in the US and Europe.”
Vaughan says digital growth tends to reduce traditional revenue and margins but MoneyGram is experiencing increases in its traditional business and new revenue from its crypto-currency service, which is still under development.
“We allow wallets to subscribe to our core. These wallets can help consumers and other countries buy and sell US stable coins tied to the US dollar,” he says. MoneyGram is also enabling customers to buy Bitcoin and Litecoin; while in preliminary stage, these services are adding additional revenue steams and opportunities.
The last mile
Modernizing the final 100 services in Kubernetes is still on Vaughan’s to-do list. Even with an IT team that has increased from 350 to 520 (including contractors) over the past two years, to enable visibility and monitoring, lifecycle management, cluster standardization, multi-cluster access management, and auditing has required bringing in Kubernetes expertise.
To that end, MoneyGram partnered with Rafay Systems in January 2022, leveraging its Kubernetes Operations Platform to accelerate its application migration to the cloud.
“MoneyGram’s aggressive modernization goals required a solution to help them move quickly to the cloud, scale operations with a small team, and do so with the highest level of security, given the particularly sensitive nature of MoneyGram’s data,” says Rafay Systems CEO Haseeb Budhani. “We helped MoneyGram move to the cloud more quickly by removing the complexities of Kubernetes.”
It’s a heady balance, to build new business models while preserving MoneyGram’s bread-and-butter business, Vaughan says.
“Our digital transformation is not just about a technology change but changing the way we as a company think and act … teaching my team to have a cloud-first mindset,” Vaughan says, adding that training his developers to change how they do everything is not easy. “It’s a major cultural change to tell my team to go and rewrite all of our DevOps software pipelines so that we can deliver higher-quality software faster.”
According to IDC’s Cloudpath survey data, payment processing is the most frequently cited workload that financial institutions have deployed in the cloud so it’s a no-brainer that a firm like MoneyGram has invested in cloud computing.
Aaron Press, an IDC research director who specializes in global payment strategies, says rewriting the software and moving to a modern cloud architecture represents an investment in the future for a company that will be under continuing duress due to increasing competition and a dated business model.
“There’s no question that the legacy remittance market is under pressure from fintechs, especially as the market becomes more fragmented,” Press says. “The incumbents will need to build on their legacy advantages of a broad range of services and strong physical networks, and add significant innovation in technology, products, and business models if they are going to remain relevant in the long term. “
Through his cloud migration, Vaughan is betting that MoneyGram has.
About Author
