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Western Union (WU) Expands Digital Services in Philippines

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The Western Union Company (WU - Free Report) recently joined forces with Cebuana Lhuillier, the leading micro-financial service provider in the Philippines, in a bid to expand digital money transfer services across the country.

The partnership will enable customers with an embedded micro-savings account to send and receive money transfers digitally through the Cebuana Lhuillier Mobile App — eCebuana (“eCeb”). Instead of having to travel to retail locations for receiving money transfers, the eligible customers can now receive Western Union international transfers directly into the eCebuana app. The service of sending domestic and global money transfers through the Cebuana Lhuillier app will start from early 2022.

Western Union and Cebuana Lhuillier share a strong bond owing to their common goal of expanding enhanced services and offerings aimed at seamless and trustworthy cross-border money transfers globally. As a result, both the companies continue to roll out innovative money transfer services and upgrade the existing ones to address the evolving needs of customers. Last year, both the companies collaborated as a result of which over 2,500 Cebuana Lhuillier locations across the Philippines were added to the global network of Western Union.

The recent tie-up seems to be an expansion of the partnership. The introduction of digital money transfer services will further strengthen Western Union’s relationship with Cebuana Lhuillier and aid it in serving customers through both online and offline means.

This digital initiative is a time-opportune one as well. Digital money transfers, which can be executed rapidly and at lower costs, are of utmost importance amid the ongoing pandemic.

The latest move highlights Western Union’s sincere efforts to strengthen presence across the Philippines. The country seems to be an attractive market for Western Union, given the widespread digital penetration and rising number of Internet users. A report published in Statista stated that the Philippines was among one of those countries, which suffered the least amount of losses in 2020 compared to the 2019 level. This is significant considering the fact that global remittances had come under pressure globally due to the COVID-19 induced volatilities in 2020.

Apart from the partnership with Cebuana Lhuillier, Western Union has been strengthening its presence in the Philippines with other tie-ups. The company teamed up with PERA HUB recently in a bid to facilitate seamless money receipt across the Philippines through the UnionBank app. It also partnered with TrueMoney and CARD Bank last year for efficient money transfer services across the country.

Western Union has undertaken collaborations with global financial service providers from time to time. These initiatives have bolstered its digital capabilities, paved the way for enhanced management of global payment, and strengthened its global network and presence. The company’s strong digital arm, which it has built through massive investments, coupled with several digital partnerships drives robust digital money transfer revenues. It anticipates digital money transfer revenues to attain more than $1 billion this year, up from the last year when the metric crossed the $850 million mark.

Zacks Rank & Price Performance

Shares of Western Union, which carries a Zacks Rank #3 (Hold), have lost 1% year to date compared with the industry’s decline of 12.8%.

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Stocks to Consider

Some better-ranked stocks in the financial transaction services space include EVERTEC, Inc. (EVTC - Free Report) , Envestnet, Inc. (ENV - Free Report) and Equifax Inc. (EFX - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

EVERTEC, Envestnet and Equifax have a trailing four-quarter earnings surprise of 28.42%, 13.79% and 17.71%, on average, respectively.


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