We truly are at a time when remittances, a core part of Western Union’s business, are being transformed by technology — and in turn, are transforming lives all over the world. And we’re proud to be innovating to keep that transformation happening.
Inventor and educator Dean Kamen said that “Every once in a while, a new technology, an old problem, and a big idea turn into innovation.” I was reminded of that as I read last week’s Financial Times article, “Remittances: the hidden engine of globalization.”
For as long as people have worked abroad, they have sent money home. Those of us who follow the remittance market closely have long known how important cross-border money transfers to loved ones are to families, communities, and even nations, but it has often felt as if the pivotal role these payments play in the global economy has gone unnoticed. FT’s article makes the point of this hidden engine of the global economy and that as of 2019, remittances will surpass foreign direct investment (FDI) as the largest inflow of capital in developing nations: $689 Billion worth, according to the World Bank.
Why does this matter? Simply put, FDI ebbs and flows, subject to political whim, economic climate, and even natural disasters. People, however, always care about their loved ones. And the money sent by people living and working abroad to their families— for education, housing, health care, or even to support a fledgling business — keeps coming, even in tough times.
Remittances are an important way to move capital from one place into consumer spending in another. But they also serve as major stabilizers for struggling economies. When times are hard in a country, emigration goes up. If those emigrants wind up in a host country with lots of work, they send more money home, strengthening the struggling economy they left in the first place. Conversely, drops in remittances, in some countries, lead to reduced tax revenue and less public-sector development, further weakening an economy that may already be struggling.
It’s not hard to see that making sure money can move, nearly anywhere and everywhere people need it, is important work. Moving it quickly, easily and conveniently, and making it available—either for local, in-person pickup, into billions of bank accounts worldwide, or into the receiver’s digital wallet–is what keeps us innovating, constantly pushing our technology to make it easier for people to send money, now, to the people and places they love.
Right now, Western Union has one of the largest digital platforms for money movement in the world. Our focus on inclusive innovation powers a full range of options to serve the broadest possible spectrum of consumers. In a world abuzz over virtual currencies, we offer digital services that still pay out in local currency throughout the most remote parts of the world. Pairing our fast-growing digital network with our retail, account and mobile wallet pay-out presence allows us to serve customers using their choice of digital or cash, creating a truly inclusive platform.
As the FT article points out, the remittance market is only growing, as more and more people in developing countries look for work abroad and an aging population in the West leads to more reliance on international labor. That means that making sure this money keeps moving isn’t just good for people and communities: It’s good for business.
I’m proud to say that the hard work Western Union has done over the past several years to innovate, both by building our technology stack and honing our operations to a sharp customer focus, has left us in an ideal position to keep moving money for better — for our stakeholders and the world we all live in.