Western Union Co. WU is on track with its expansion plans in Mexico. In this regard, the company has entered into an agreement with state-owned Banco del Ahorro Nacional y Servicios Financieros, Sociedad Nacional de Crédito, Institución de Banca de Desarrollo or BANSEFI.
Per the agreement, an expanded access will be given to inbound money transfer services under Western Union®, Vigo® and Orlandi ValutaSM brands throughout the country.
The new agreement will let all Western Union and BANSEFI customers receive money transfers in more than 471 BANSEFI locations in 32 states. The pact will also expand Western Union’s network in Mexico, which currently has more than 10,000 agent locations.
Western Union has chosen BANSEFI since it will provide Western Union with nearly 14 million customers. The company is intent on expanding its business in Mexico since it qualifies as the fourth largest recipient of remittances globally. According to data from Banco de Mexico, the region saw $23.64 billion in remittances, which took the second highest spot among the country’s sources of foreign exchange revenues.
The company has therefore been making consistent efforts to expand in the region. In January, the company announced that it will launch international direct-to-bank money transfers to Mexico from the United States via the Grupo Financiero Banorte’s UniTeller network.
In Mar 2014, Western Union collaborated with Farmacias Guadalajara, a Mexican drugstore chain. This deal enables Western Union to provide money transfer services in 1,100 drugstores and retail locations across Mexico.
In Apr 2013, Western Union Company and Banorte, one of the largest financial institutions in Mexico, announced a five-year agreement that will allow the latter to offer Western Union® global money transfer services.
The region accounts for around 10% of Western Union’s revenues. It is one of the major receive locations. Receive locations have large inbound remittance markets. Western Union has a wide reach in Mexico, with a strategically combined network of agent locations that include banks, national retail chains and independent locations. Western Union, in conjunction with its Orlandi Valuta and Vigo brands, connects consumers in Mexico to more than 510,000 agent locations across 200 countries and territories worldwide. The company has been operating in the Mexico corridor for more than a century. Although, Mexico is an important location for Western Union, tougher immigration and money transfer standards in light of security concerns have, however, led to slowing growth in the U.S.-to-Mexico corridor.
Another money transfer company Xoom Corp. XOOM has significant operations in Mexico. The country’s vast remittance market has also caught the attention of Western Union’s close peer Moneygram International, Inc. MGI. The company offers its services in the Mexican market in partnership with Visa V.
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