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Western Union (WU) Extends Relationship With Japan's Seven Bank
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The Western Union Company (WU - Free Report) recently announced that the company has boosted its decade-old relationship with Japan’s Seven Bank through a tenure extension. The move solidifies Western Union’s commitment to enable customers to reach more than 200 countries and territories at a time when economies around the world are witnessing rapid recovery. As such, WU is expected to play a crucial role in the global remittance market, with an uptick in consumer spending.
Western Union has operations in Japan since 2021 and the latest move bolstered its footprint in the country. It provides multi-channel capabilities to clients across retail and digital channels, which offer them various money transfer options. Among other options, WU offers money transfer services at more than 26,000 Seven Bank ATMs in the country. The tenure extension is expected to enhance the value of its massive global financial network that works with more than 130 currencies.
Western Union is making significant investments in its digital platform to stay ahead in the fast-changing remittance market. WU’s vast electronic platform built over the years helped it during the pandemic-induced crisis when people turned away from its brick-and-mortar stores to send money to their families online. In 2021, WU’s digital money transfer revenues increased 22% to more than $1 billion.
Growing Competition
The tenure extension move in Japan is a prudent one since cross-border transactions are likely to rise due to growing international trade. It is to be noted that the payment space is currently seeing an influx of a large number of companies with the likes of PayPal Holdings, Inc. (PYPL - Free Report) , Mastercard Incorporated (MA - Free Report) , MoneyGram International, Inc. and others, giving a tough competition to Western Union, which was once a dominant player in the remittance space.
PayPal offers domestic and international person-to-person payment facilities with the help of PayPal and Xoom products. The company continues to gain solid traction in the global online payment market. In the Asia-Pacific region, PYPL is expanding its presence via growing operations in Australia, Philippines and other countries. It enables customers to send payments in more than 200 markets globally.
Headquartered in Purchase, NY, Mastercard has partnered with global financial technology (FinTech) startup Jeeves to launch the first physical card in Mexico, which will enable clients to pay in any currency wherein Mastercard is operating. MA’s deal with Jeeves will provide clients with easy solutions, cashback opportunities and secure cross-border transactions. The move will boost its presence in the Latin American market, wherein it has made several deals in the past few months.
MoneyGram partnered with global fintech company Digital Wallet Corporation of Japan, the owner of Smiles Mobile Remittance. The deal has expanded MoneyGram’s cross-border money transfer business. The move enables clients in Japan to use the Smiles mobile app to send money to more than 200 countries. Through the partnership with Digital Wallet Corporation, MGI is expected to capitalize on the growing cross-border money transfer services market in the Asia-Pacific.
Price Performance and Zacks Rank
Western Union’s shares have declined 17.5% in the past year compared with a 23.4% fall of the industry it belongs to. The company currently has a Zacks Rank #5 (Strong Sell).
Image: Bigstock
Western Union (WU) Extends Relationship With Japan's Seven Bank
The Western Union Company (WU - Free Report) recently announced that the company has boosted its decade-old relationship with Japan’s Seven Bank through a tenure extension. The move solidifies Western Union’s commitment to enable customers to reach more than 200 countries and territories at a time when economies around the world are witnessing rapid recovery. As such, WU is expected to play a crucial role in the global remittance market, with an uptick in consumer spending.
Western Union has operations in Japan since 2021 and the latest move bolstered its footprint in the country. It provides multi-channel capabilities to clients across retail and digital channels, which offer them various money transfer options. Among other options, WU offers money transfer services at more than 26,000 Seven Bank ATMs in the country. The tenure extension is expected to enhance the value of its massive global financial network that works with more than 130 currencies.
Western Union is making significant investments in its digital platform to stay ahead in the fast-changing remittance market. WU’s vast electronic platform built over the years helped it during the pandemic-induced crisis when people turned away from its brick-and-mortar stores to send money to their families online. In 2021, WU’s digital money transfer revenues increased 22% to more than $1 billion.
Growing Competition
The tenure extension move in Japan is a prudent one since cross-border transactions are likely to rise due to growing international trade. It is to be noted that the payment space is currently seeing an influx of a large number of companies with the likes of PayPal Holdings, Inc. (PYPL - Free Report) , Mastercard Incorporated (MA - Free Report) , MoneyGram International, Inc. and others, giving a tough competition to Western Union, which was once a dominant player in the remittance space.
PayPal offers domestic and international person-to-person payment facilities with the help of PayPal and Xoom products. The company continues to gain solid traction in the global online payment market. In the Asia-Pacific region, PYPL is expanding its presence via growing operations in Australia, Philippines and other countries. It enables customers to send payments in more than 200 markets globally.
Headquartered in Purchase, NY, Mastercard has partnered with global financial technology (FinTech) startup Jeeves to launch the first physical card in Mexico, which will enable clients to pay in any currency wherein Mastercard is operating. MA’s deal with Jeeves will provide clients with easy solutions, cashback opportunities and secure cross-border transactions. The move will boost its presence in the Latin American market, wherein it has made several deals in the past few months.
MoneyGram partnered with global fintech company Digital Wallet Corporation of Japan, the owner of Smiles Mobile Remittance. The deal has expanded MoneyGram’s cross-border money transfer business. The move enables clients in Japan to use the Smiles mobile app to send money to more than 200 countries. Through the partnership with Digital Wallet Corporation, MGI is expected to capitalize on the growing cross-border money transfer services market in the Asia-Pacific.
Price Performance and Zacks Rank
Western Union’s shares have declined 17.5% in the past year compared with a 23.4% fall of the industry it belongs to. The company currently has a Zacks Rank #5 (Strong Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.