The Western Union Company ( WU Quick Quote WU - Free Report) recently expanded its longstanding ties with Mastercard Incorporated ( MA Quick Quote MA - Free Report) in a bid to meet domestic and cross-border money transfer needs for their respective global client base.
The extended collaboration between Western Union and Mastercard, which have been working together for a decade now, revolves around two initiatives this time.
The first move encompasses integration of Mastercard Send within the worldwide money movement network of Western Union in an effort to boost transaction speed and ease the receive procedure. By utilizing the capabilities of Mastercard Send, WU intends to bolster payout capabilities for its beneficiaries of U.S. domestic money transfers. Receivers can now seamlessly receive funds from any domestic transaction in the United States to their respective accounts linked to a debit card.
Apart from benefiting the U.S. customers, Mastercard Send can also be availed by Western Union customers across 16 European markets. Clients of these markets can directly transfer money to the Mastercard debit card of receivers. Keeping in mind both senders and receivers, more countries are likely to join the network within the coming months.
The second initiative involves utilization of the global network of Western Union Business Solutions (WU’s unit) to boost fund dispensing on behalf of Mastercard Cross-Border Services to existing bank and trade network relationships.
The latest move reflects the faith that Mastercard, one of the world’s top financial service companies, has on the Western Union’s technological prowess and omni-channel global financial network for providing innovative cross-border payment solutions.
The recent endeavor also highlights Western Union’s continuous efforts to pursue a digital partnership strategy for upgrading and digitizing the money movement process for consumers and businesses. Given the robust demand for real-time payments and increased smartphone usage, the solid digital arm of this Zacks Rank #3 (Hold) leader in global money movement and payment services yielded results amid the coronavirus outbreak. The pandemic induced uncertainty made digital money transfers the need of the hour for addressing emergency needs.
Western Union was able to build this arm through several digital tie-ups and substantial investments. WU has been entering into several collaborations with global and local financial service providers, which are aimed at bolstering digital services portfolio, facilitating enhanced management of global payments and boosting customer experience. In November 2021, Western Union teamed up with Metrobank so that inbound money transfer receivers in the Philippines can directly receive money into bank accounts.
Apart from Western Union, other companies like
Visa Inc. ( V Quick Quote V - Free Report) and MoneyGram International, Inc. ( MGI Quick Quote MGI - Free Report) have also resorted to digital partnerships for capitalizing amid a growing digital era.
Visa pursues collaborations to aid the payments industry with innovative digital solutions and facilitates seamless and secure transfer of funds on a real-time basis worldwide. While Visa B2B Connect keeps on adding partners to its network, Visa Direct’s digital payment capabilities have been leveraged by several organizations.
It has taken several years for a brick-and-mortar company like MoneyGram to build a digital arm on the back of several partnerships and significant investments. MGI has a solid pipeline of new digital partners in place in an effort to bolster growth prospects of this arm. As a result, MoneyGram anticipates its digital business to account for 50% of all money transfer transactions in 2024.
Shares of Western Union have lost 16.8% year to date compared with the
industry’s decline of 20.5%. You can see . the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here Image Source: Zacks Investment Research
While shares of MoneyGram have gained 15.3% year to date, Visa's stock has lost 3.1% in the same time frame.