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Payment transfer giant Moneygram to move EU offices out of London

Hannah Boland
London - © 2016 Bloomberg Finance LP

US money transfer giant Moneygram will move its European headquarters out of London to Brussels, putting hundreds of UK jobs at risk, as financial services chiefs attempted to sway the Government in favour of maintaining single market access after Brexit. 

Moneygram had warned last month that it would be forced to shift its operations servicing the European Economic Area, as "once the UK is no longer part of the EU, it is anticipated the company will no longer be able to provide payments services outside the UK".

The group, whose UK business Moneygram International employed 300 people as of Dec 31, 2016, providing services across Europe and generating around €233.6m (£208m) in revenue, said it would be repatriating those operations to a EU member company. 

The National Bank of Belgium confirmed on Thursday it had issued a banking licence to Moneygram, following meetings with the group in the spring last year.

The bank said it would become the supervisory authority of Moneygram's activities in Europe and that it was "expected that the Brussels based operation will start in summer 2018". 

Moneygram noted earlier this year that, even with a move, it expected "continued profitable growth within the UK". 

In a statement on Thursday evening, it said: "MoneyGram can confirm that we have recently been authorized by the NBB as a payment provider. MoneyGram operates in more than 200 countries, including Belgium, and maintains licenses throughout the world to ensure we are providing the most secure and compliant money transfer service for our customers."

FAQ | Brexit and the City of London

The decision to shift operations follows similar actions by financial services peers since the UK voted to leave the European Union, including Lloyds of London, JP Morgan, Deutsche Bank and Bank of America. 

Whilst London has historically served as the hub of European finance, and is home to the EU headquarters for many international banks and asset managers, those businesses have had to reassess their positions in the capital to ensure they can continue to service European clients once the UK exits the single market.

Talks are ongoing between UK and EU bodies over how the financial services sector will operate after Brexit, however, and on Thursday, the heads of a number of financial services companies said they were willing to pay for continued access to the EU single market.

Those hopes, though, appeared to be swiftly dashed by the UK Government, which ruled out paying Europe for access.