MoneyGram International (NASDAQ:MGI) is a global money transfer specialist that competes with Western Union and other, smaller companies. Its main business was previously in cash, but as money transfer goes digital, MoneyGram has struggled to stay relevant. Its stock has been at a low for a long time. Its domestic business isn't too exciting, and it hasn't been able to pull it together to please shareholders.

But what goes down doesn't necessarily have to come back up. Is it finally time to buy into this company, or is it headed for greater challenges?

Driving digital business

MoneyGram definitely has opportunities with digital transfers as payments move away from cash and it's easier than ever to send money digitally. Previously, a customer would have to bring cash in hand including a fee to an agent location, show ID, and fill out forms in writing. The receiver would need to pick it up from an agent location nearby with ID.

Today, in most cases this can all be done online, although there are still options for cash movements. Money can be deposited into a bank account instead of having to be picked up in person, and fees have come down. MoneyGram is taking advantage of this with greater online options and a redesigned website. It began its digital restructuring during the first quarter of 2018, ultimately spending $20.4 million on the project in fiscal year 2018 that resulted in a reduction in overall expenses of $30.5 million. Digital transactions accounted for 20% of the total in the company's 2019 third quarter.

Person handing over money to another.

Image source: Getty Images.

Collaborating to gain steam

MoneyGram has also signed many new partnerships with global finance-related businesses, including: 

  • A deal with cryptocurrency company Ripple, which now owns 9.95% of MoneyGram's outstanding common stock. MoneyGram uses Ripple's on-demand liquidity powers to complete foreign exchange transactions quickly.

  • An agreement with Visa where U.S. customers can send money internationally through a deposit with Visa Direct.

  • A collaboration with Lulu Money, a non-bank financial company headed in the United Arab Emirates that covers the UAE and Asia-Pacific regions. MoneyGram capabilities will be available in all of Lulu's branches and digital operations.

  • A partnership with BrightWell, a financial technology company that supports global financial transactions for U.S. international workers, specifically cruise-ship employees.

  • A renewal of a contract with CVS pharmacies as point-of-contact locations for MoneyGram.The company also has an arrangement with Walmart.

These are all good moves for MoneyGram and strategically take advantage of its international popularity, the right path for a company that's seeing its greatest growth outside the U.S.

International growth

Some 60% of MoneyGram's total revenue comes from international transactions. This makes sense, because MoneyGram has strong international capabilities. With a withering domestic business, finding new opportunities for growth gives the company a new angle for resurgence.

The company saw record growth over the holidays, with a 70% increase in overall transactions year over year, including an almost 120% increase in international transactions. A majority of those transactions -- 80% -- took place on a mobile platform, which bodes well for the company's efforts to ramp up mobile offerings.

A bleak third quarter

MoneyGram's 2019 third-quarter report showed declining revenue year over year. Revenue has been steadily decreasing since a high in 2017, and the company has been urgently changing operations to stem the bleeding. It recently lowered international pricing and repositioned marketing efforts, which has resulted in a higher number of transactions.

On another bright note, MoneyGram instituted some cost-cutting measures that lowered its non-commission expenses by 13% and compensation and benefits by 19%.

Growing through the next decade

With fintechs and banks moving online, there is tremendous opportunity for the company to grow in new ways, but there's also competition. For example, Zelle can move money between U.S. bank accounts at no cost. That's one of the reasons MoneyGram is seeing higher growth internationally, where moving money between countries is more challenging and riskier.

That said, the company has been investing in partnerships to reinvigorate its business, and that's the right move. In short, it's doing what it needs to. But while I wouldn't suggest buying into this company just yet, it's one to monitor. At the current price, if the financials improve, it could be a great opportunity.