Western Union Expands Online Services - Analyst Blog
17 3월 2012 - 2:58AM
Zacks
World’s leading money transfer company Western Union
Co. (WU) announced the expansion of its online business
payment platform in the European countries — Austria, Belgium,
Netherlands and Sweden.
These countries import huge quantities of machinery and
equipment, chemicals, fuels, gems and foodstuffs. Thus it becomes
necessary for small and medium enterprises to make cross-border and
cross-currency payments.
Western Union online payment service will enable customers to
make payments worldwide 24x7 in more than 140 currencies. The
service also offers customers the advantage of hedging against
currency fluctuation by locking in the exchange rate favorable for
them.
So far Western Union’s online business payment service was
available in other European countries such as United Kingdom,
Germany, Ireland, Italy and France. The company is on track with
its European strategy of being closer to consumers and optimizing
its operating model. Though Europe remains a weak spot for 2012,
the company is positioning itself in the region for future
growth.
On the other end of the spectrum, Western Union in is trying to
penetrate deeper into the global business payments industry that
has evolved with technological innovations. The company has
devised new methods of processing payments.
The cross-border payments industry is expected to witness a boom
in the future, with businesses intent on expanding their global
presence. Management believes that the United States is in the
midst of a transition from cash and paper checks toward electronic
payment methods, which are easily accessible through multiple
technologies.
Money transfer services through electronic channels accounted
for approximately 3% of consolidated revenue for the year ended
December 31, 2011. The company had already been providing online
money transfer services in more than 20 countries during the same
period. Last year, the company also announced the formation of a
new unit named Western Union Ventures, which will feature the
company’s new-age service offerings for customers.
Management expects the digitalized platform for the remittance
market to evolve at a much faster rate than the traditional means
in the upcoming period. The company’s westernunion.com business is
worth over $100 million at present and management expects $500
million in revenue from this line of business by 2015.
Western Unioncompetes closely with Moneygram
International, Inc. (MGI). Western Union currently
retains a Zacks # 3 Rank, which translates into a short-term ‘Hold’
rating. We are also maintaining our long-term “Neutral”
recommendation on its shares.
MONEYGRAM INTL (MGI): Free Stock Analysis Report
WESTERN UNION (WU): Free Stock Analysis Report
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Western Union (NYSE:WU)
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