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27/05/2016

Western Union quizzed by EU on money transfer activities

Development Policy

Western Union quizzed by EU on money transfer activities

Western Union desks at Munich airport.

[Georgi Gotev]

US money transfer services provider Western Union has been questioned by antitrust regulators over its activities in Europe, focusing on whether agreements with its agents are anti-competitive.

The company, which has agents in more than half a million locations worldwide, said it had been contacted by the EU antitrust enforcer.

“Western Union is cooperating with the European Commission following a request for information on the company’s business in Europe,” spokesman Daniel Diaz said in an email.

Commission spokesman Ricardo Cardoso said the antitrust authority was closely monitoring competitive conditions in the money transfer market.

UN official: Remittances should be less expensive

Transferring remittances can be very expensive, for both the sender and for the recipient. The United Nations Capital Development Fund is working to address this issue, Judith Karl, Executive Secretary of UNCDF, told EurActiv in an exclusive interview.

EurActiv.com

The EU authority is seeking more details on Western Union’s network of agents, ranging from those running corner shops to those working in post offices, a person familiar with the matter
said.

Regulators typically get involved when dominant market players impose conditions preventing their distributors from selling rival products, thwarting competitors from challenging them.

The Commission is checking allegations that Western Union colluded with banks to drive out smaller rivals in the money transfer market, Bloomberg cited two unnamed sources as saying.

Western Union said there was strong competition in the market coming from banks, digital operators, mobile operators, mail and courier services, prepaid cards, travel cards as well as ATM transfers.

Remittances and savings of the diaspora can finance development

There are more than 230 million international migrants worldwide – more than the population of the world’s fifth most populous country, Brazil. To help finance development, new “diaspora” financial instruments, or diaspora bonds, could be created, write Mahmoud Mohieldin and Dilip Ratha.

EurActiv.com

The World Bank last year forecast a 0.4% rise in global money transfers to $586 billion for 2015 compared with a 4.1% increase this year to $610 billion.