One of the most “disrupted” markets of the last ten years has been the money transfer industry. Money transfer apps, peer-to-peer currency networks, and off the rack white label solutions from a new nimble breed of fintechs have reduced customer fees, improved exchange rates and speeded up transfer times.
But when it comes to money, it’s not always about the money.
We talk to Massimiliano Alivisini, Senior Vice President and General Manager, Western Union, Europe, CIS and Africa to find out what the incumbent WU has been doing to stay ahead of the competition.
What is the one thing that Western Union does better than other money transfer providers in the market?
If I may, I will pick two. Firstly, I believe that almost no other player in the cross-border payment market can bridge the physical and digital worlds as Western Union does. With a retail network of approximately 600,000 locations, one of the largest digital money transfer networks globally, reaching more than 200 countries and territories, and dealing in more than 130 currencies, I believe we are one of the very few brands in the world that are truly global. Add to that the many options we give our customers to fund/receive their payments, from retail, to web, to app, cash or card, to retail, web, app, bank account, card or mobile wallet. The reach, scope and size of our network, our omni-channel platform is a remarkable achievement – and one that cannot be easily replicated, if at all.
Secondly, we are driven by our purpose, like very few companies are. We connect people around the world, and quite often people and communities that need it the most, seamlessly to their families and loved ones, globally, and to the world economy, fostering financial inclusion and giving people dignity, opportunity, and hope along the way. This is something that makes us all at Western Union extremely proud.
How has Western Union, as an incumbent addressed the rise of challenger brands in the money transfer market?
What drives us all at Western Union, what drives me, is our unshakeable passion for our customers. It is for them we deliver every day. All of our work focuses on our customers; on providing them with the flexibility and trust they need and deserve. So, we are truly proud of this relationship of trust we have built with the many millions of our customers for 170 years now.
That said, we never rest on our laurels. We constantly invest in technology and innovation. A few years ago, we were known for our iconic retail network, which reaches almost every corner of the world. Today, we have one of the largest digital cross-border money transfer networks globally. Our customers can send money directly to billions of bank accounts, mobile wallets and cards – often in near real time!
This isn’t easy, nor straight-forward. The complexity of moving money and information across the world is often underestimated. We are all used now to paying friends, or splitting restaurant bills from an app. The cross-border reality is rather more complicated. And it is more complicated as we have 20,000 “corridors”, or country-pairings, that we serve. This gives you an idea of the magnitude and the complexity of our operation.
When moving money, we must ensure that we always know our customers, know our agents, with close to zero margin of error. To do that, at Western Union, we constantly invest in technology, including in AI and predictive analytics can assist in implementing responsive controls while also improving customer experience. Investing in compliance is not a theoretical concept: it is the foundation of a relationship of trust with customers.
So, our investment in our omni-channel platform, innovation, and giving our customers flexibility and trust means we can continue our successful course in the market – and look forward to our next 170 years!
Banks and post offices are under increasing threat from fintechs and other players in the money transfer market segment. How does Western Union help Financial Institutions to fight back?
We are evolving to become a global digital centric payments company. To achieve that, over the last decade, Western Union invested substantially to build the leading omni-channel platform for cross-border, cross-currency money transfers and payments. As part of this strategy, we opened our cross-border platform to third parties, including major FIs around the world. This has been a huge success for Western Union, and a testament to our investment in customer experience and innovation: we are privileged today to be working with some of the world’s most important financial institutions, including top financial institutions in Europe.
Banks still move the majority of global transfers, but they are limited by a close banking model, which is time-consuming. Banks take several days to clear money from one account to another. Not us: our global network for funds collection with web, apps, kiosks and retail and funds distribution via accounts, wallets, cards, and retail is unrivaled. We deliver money at one end of the pipeline as soon as we receive it on the other.
Our constant investment in technology and our platform, combined with unparalleled understanding of compliance regulations and our broader expertise, as well as the scale and reach of our network, provide Western Union with a clear competitive advantage. It can help banks improve customer experience – and capture new opportunities.
When it comes to types of partnerships, we can partner with banks so that they can offer their customers an optimized P2P cross border payments experience. White label and co-branded, depending on partner need and local licensing requirements.
What’s the best advice you could give to individuals and businesses to get a better deal on money transfers?
Cross-border money transfers, and remittances in particular, are the unsung heroes of globalization. They put money directly into people’s hands. Equally, for businesses, global connections and trade are more important than ever before. In what is a crowded, competitive market, consumers and businesses are often confused, and rightly so.
So my advice, to put it simply would be to do deep research and have a 360° view of the providers’ capabilities, transparency and investment in transaction security. Price is of course one element. But equally, if not more important, is the knowledge that your money will reach its destination securely. And then you have of course speed of delivery: real or close to real-time, or hours/days? This can sometimes make a massive difference for consumers and businesses alike.
Additionally, in our globalized economy, it is not always a case of sending money to a well-known market. If you want to reach a small village in India, or Sub-Saharan Africa, or family in Latin America, which provider can really give you global access?
All these elements should be taken into account, and considered carefully.
Massimiliano Alivisini is SVP and General Manager, Western Union, Europe, CIS and Africa