In this world of ubiquitous ATMs, tap-to-pay checkout and automated bank deposits, there are still times when it’s necessary to hand over, or collect, hard cash. That’s why money-transfer services MoneyGram and Western Union have tens of thousands of agents in cities and towns around the world. 

Money-sending services can be a lifesaver. You may feel it’s unlikely you’ll ever be broke and stranded in a bus station in Bengaluru, needing your spouse to send cash, but stranger things have happened – and not just when you’re traveling abroad. How about when your child who’s studying at a Canadian university needs you to send the rent deposit – pronto? More routinely, money-transfer companies provide banking services like money transfers, money orders and bill payment to people who don’t have bank accounts. In the United States and Canada, many customers are new immigrants who send money regularly to family members in their home countries. Outside the U.S., it’s even easier to find a nearby agent for MoneyGram (MGI) or Western Union (WU) or both. Cash is still king in many countries, and, in developing nations, many people don’t have bank accounts.

So which is better, MoneyGram or Western Union?

The Big Three

There is now actually a “big three” in the money-transfer business: MoneyGram, Western Union and Walmart (WMT), with the retail giant recently entering this business. However, Walmart utilizes MoneyGram for all domestic and international money transfers. 

In the U.S., MoneyGram and Western Union services are available in many pharmacies and supermarkets, as well as small local businesses, bus stations and check-cashing outlets. For most of these agents, handling money transfers is a side business. Walmart offers its service in its stores, online or via an app.

A Few Drawbacks

One drawback to sending cash through these services is that they open or close with the stores’ usual hours. You may have to cool your heels at the bus station until the next morning before your family can send you that emergency cash.

The biggest drawback of any money-transfer service is the vulnerability of its customers to fraud. A request from a stranger for payment via cash transfer is usually a fraud. Since the recipient is untraceable, it’s the modern equivalent of stuffing a wad of unmarked bills into an envelope and leaving it in a public place on instructions from a stranger.

Which One to Use?

There are a few differences between the services: 

Western Union is the larger of the two companies and has instant name recognition around the world, thanks to its one-time monopoly of the telegraph business. Sending telegrams was discontinued only in 2006, but by then Western Union had moved on to new ventures. It has about 500,000 locations in over 200 countries around the world. Customers can send money by phone, through the Western Union website, or in person.

Fees can be steep or cheap, depending on a long list of factors, including the form of payment used, how fast the money is delivered, whether it is paid in cash or wired to a bank, where it is sent from and where it is delivered. For international transfers, the exchange rate adds another element of uncertainty to the cost. 

For domestic transfers, if you pay cash at a Western Union agent and the recipient picks it up in cash, the cost is $5.00. If you have the funds withdrawn from your online bank account, it costs $11.00, and if you use your debit or credit card, the cost is $49.99. Bank-to-bank transfers are only $0.99, and using a debit or credit card to pay money into the recipient's bank account is $20.00.

Western Union's international transfer fees can vary widely. For example, you are in the United States and want to deliver $500 to someone in Mexico. If you pay cash at a Western Union agent or have the funds withdrawn from your online bank account, and the recipient picks it up in cash, it costs $5.00. If using a debit or credit card, the same transaction costs $7.00. The same transaction costs $2.99 for a bank-to-bank transfer or if a credit or debit card is used to pay money into a bank account. If paying online or via the mobile app, the fees range from $4.00 to $7.00. However, charges for this same transaction to Ireland range from $5.00 to $42.00, and, to China, charges range from $10.00 to $75.00.

MoneyGram is Western Union’s biggest rival, and its domestic transfer fees closely match its competitor. It recently changed its fees to $11.00 if paying from an online bank account and $49.99 if paying with a debit or credit card for transferring $50 to $900 within the United States and 2% for amounts over $900.

MoneyGram built its reputation on international money transfers. It has over 25,000 payment locations in Africa alone. However, MoneyGram’s rates for international money transfers don’t appear to be much simpler than those of Western Union. You can transfer $500 to Mexico, using a credit or debit card, for a $9.99 fee, but the same transaction costs $31.00 if the money is picked up in Ireland, and $49.99 if it goes to China.

Walmart offers a lower price than its rivals in this area, and money can be transferred domestically or internationally through MoneyGram from Walmart stores, online or via an app. Its fees are currently $4.00 for up to $50, $8.00 for $51 to $1,000 and $16.00 for $1,001 to $2,500. 

The Bottom Line

The many pricing variables make it impossible to state whether Western Union, MoneyGram or Walmart is the best, or even cheapest, service available. 

It’s safe to say this: If your child is 1,000 miles away at an American college and desperate for cash, the easiest, cheapest and fastest thing to do will usually be to drop by your local Walmart.

If you’re sending money to someone in Beijing or Djibouti, and it’s not an emergency, check the fee calculators on Western Union and MoneyGram to see which one has the better rate for where you are, where you’re sending money, how much you’re sending, what form of payment you’re using, how you want it delivered, and how quickly it needs to arrive. The fee estimators display the exchange rate used on that day, and it’s best to check that as well.