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Finovate Blog
Tracking fintech, banking & financial services innovations since 1994
Payments platform Paysend announced a partnership with Western Union this week.
The partnership will enable consumers to send money via Western Union directly to Visa and Mastercard debit cards.
Paysend made its Finovate debut in 2016 at FinovateEurope.
International payments platform Paysendinked an agreement with Western Union today. The partnership will enable consumers to send money via Western Union’s branded digital solution directly to both Visa and Mastercard debit cards. Paysend will provide a single API that ensures seamless processing of these Western Union customer payments at live FX rates, 24/7, 365 days a year.
“Paysend’s mission is to make money transfer easier for everyone,” Paysend Executive Chairman and co-founder Abdul Abdulkerimov said. “We are thrilled to join forces with Western Union, a company known for its global reach and commitment to financial inclusion. Together, we will empower millions with accessible cross-border money transfer services.”
The remittance market continues to be a major source of economic growth for communities around the world. The World Bank estimated that remittances grew 5% to more than $800 billion last year. This week’s partnership comes in the wake of a pilot program recently launched by the two companies. The program will help customers send money from the U.S. and U.K. to Pakistan, the U.K., and Spain easier -with additional locations coming soon. The news also follows strategic collaborations between Paysend and Visa and between Paysend and Mastercard that were announced last month. These partnerships are part of the company’s effort to expand its ability to improve cross-border payments for SMEs and individuals. “Our mission at Paysend is simple,” Abdulkerimov said, “to deliver the world’s simplest money transfer service.”
Founded in 1851, Western Union today serves as one of the largest money transfer businesses in the world. The company is active in more than 200 countries and territories, and facilitates fund transfers in nearly 130 currencies. Headquartered in Denver, Colorado, Western Union offers wire transfer, mobile money transfer, and other fund transfer services. These offerings include Western Union Connect, which facilitates fund transfers between the U.S. and China. Last week, Western Union reported Q3 results that, according to company President and Chief Executive Officer Devin McGranahan, “exceeded our expectations and demonstrate a continued positive trajectory against our ‘Evolve 2025’ goals.”
Paysend made its Finovate debut in 2016 at FinovateEurope, and returned to the Finovate stage two years later for FinovateSpring. Headquartered in London, the company this year has forged partnerships with global onboarding and payroll platform RemotePass, payroll platform Ontop, and Spanish-language content and media company, TelevisaUnivision.
Paysend has raised more than $272 million in funding. Global PayTech Ventures and InfraVia Capital Partners are among the company’s investors.
In the wake of the FTX scandal and the so-called “crypto winter,” the Canadian Securities Administration (CSA) has issued a set of new regulations for cryptocurrency exchanges. The new guidelines involve both commitments to investor protection as well as a registration mandate. The mandate requires “crypto asset trading platforms” (CTPs) operating in Canada to provide a pre-registration commitment to Canada’s security regulators within 30 days – and begin a full registration process. Announced this week, CTPs in Canada will have until late March to comply. Those institutions that do not comply will not be allowed to legally serve Canadian clients. The regulations also institute a significant crackdown on the trading of stablecoins. Defined as “securities and/or derivatives” by the CSA in 2022, these digital assets can no longer be purchased or stored on cryptocurrency exchanges without written permission from the CSA.
“Recent insolvencies involving several crypto asset trading platforms highlight the tremendous risks associated with trading crypto assets, particularly when conducted on unregistered platforms based outside of Canada,” CSA Chair and Chair and CEO of the Alberta Securities Commission Stan Magidson said.
The new rules will undoubtedly make life tougher for cryptocurrency exchanges in the near-term. Nevertheless, the new regulations may provide more room for these businesses to operate than it may seem at first glance. From the multi-part registration process to the ability to secure permission to offer stablecoins, it seems clear that Canadian regulators are taking a relatively cautious approach to correcting the course of cryptocurrencies in the Great White North.
Ding and Western Union Bring Mobile Top-Up to Canadian Customers
The international mobile top-up platform Ding has teamed up with one of the leaders in the money transfer business. Ding has reached an agreement with Western Union that will enable customers in Canada to send international top-up payments to the mobile phones of more than five billion prepaid customers worldwide.
“We are thrilled to be teaming with one of the largest money transfer operations in the world,” Ding Chief Financial Officer Jonathan Rockett said. “The launch of Ding Checkout with Western Union will give consumers access to a complimentary service which they can use to support their friends and families around the globe. We are excited to unveil our capabilities as a digital value transfer platform and drive growth in both new and existing customers for Western Union.”
The partnership between Ding and Western Union will launch in Canada first. The partnership will give Western Union customers access to Ding’s network of more than 600 mobile operators across 140+ countries, covering 95% of the world’s population. The collaboration also gives Western Union customers a new way to add minutes and data quickly to their mobile plans.
Nuvei Completes $1.3 Billion Acquisition of Paya
At the beginning of the year, Canadian paytech Nuvei announced that it had agreed to acquire U.S. integrated payments and commerce solutions provider Paya for $1.3 billion. This week, Nuvei reported that the transaction has been completed.
“This is an important milestone for Nuvei as we continue to build a preeminent payment technology provider with strong positions in global eCommerce, Integrated Payments, and B2B,” Nuvei Chair and CEO Philip Fayer said in a statement. “I’m thrilled to officially welcome our new colleagues form Paya to the Nuvei family. We have been working diligently on our integration planning, and we are ready to begin the next step on this exciting journey as a single, unified team.”
Paya processed $50 billion in annual payment volume in 2022, with much of that amount coming from companies in verticals such as healthcare, non-profit, government, utilities, and other B2B end markets. Nuvei paid $9.75 per share for the NASDAQ-listed company, which went public via a merger with special purpose acquisition company (SPAC) FinTech Acquisition Corp III in 2020.
Headquartered in Montreal, Quebec, Nuvei was founded in 2003. The company also made headlines this year in forging new partnerships with enterprise digital commerce platform VTEX, Colombian payment processor Redeban, and online business marketplace platform Le Panier Bleu.
Here is our look at fintech innovation around the world.
Central and Eastern Europe
Swiss software firm Netcetera acquired Slovenian mobile app and digital identity development company Kamino.
Germany-based business financial management (BFM) company finway secured $10 million (€9.2 million) in Series A funding.
Middle East and Northern Africa
Remittance processor Remitly went live with its outbound remittance solution in the UAE.
Morocco-based fintech Gwala raised pre-seed funding to support its on-demand payment solution for employees and employers. The amount of the investment was not disclosed.
Pakistani digital lending platform AdalFi announced a $7.5 million investment led by UAE-based COTU Ventures, Chimera Ventures, Pakistan-based Fatima Gobi Ventures, and Zayn Capital.
Indian payments solution provider PayU launched its 3D Secure 2.0 SDK.
Latin America and the Caribbean
Mexican mobile banking app Tudi selectedThetaRay as its AML/transaction monitoring partner.
Western Union and Beforepay announced a partnership that will enable Australians to pay for money transfers in installments after the money has been sent.
Called Send Now, Pay Later, the tool enables users to borrow around $1,400 (AUD $2,000) and repay in installments over a short period of time.
44% of Australia’s consumers said they would like an option to Send Now, Pay Later.
Global money transfer company Western Union is teaming up with payment innovator Beforepay to offer its Australia-based customers a short-term loan option. Dubbed Send Now, Pay Later, the tool leverages Beforepay’s wage-advance product to enable users to borrow up to around $1,400 (AUD $2,000) via Western Union’s digital channels.
Registration for the new service takes “minutes” and users can repay the amount in multiple installments. Western Union is hoping the new capability will enable Australia users to increase the amount of their money transfers. The company reports that 44% of Australia’s consumers said they would like an option to Send Now, Pay Later.
“We are committed to supporting our customers and their communities by offering financial services that are accessible, ethical, and reliable,” said Western Union Regional Vice President of Australia, New Zealand, and the Pacific Islands Gregory Laurent. “Western Union’s mission is to make financial services accessible to people everywhere. Our collaboration with Beforepay is another step towards achieving this mission – giving customers the opportunity to access additional funds as they send money to families and communities. We are excited about the positive impact it can have for consumers, as they proactively look for convenient options to meet their financial needs.”
Western Union was founded in 1851 and is one of the oldest cross-border money transfer pioneers. The company enables users to send international money transfers in more than 130 currencies to over 200 countries and territories. Last August, Western Union expanded its partnership with Visa to bring Visa Direct to its U.S. clients.
With 750,000 registered users, Beforepay offers a wage advance product that extends small dollar loans over a short period of time. The company charges a 5% fee for its flagship product, but does not charge interest, late fees, or penalty fees. The average Beforepay advance totals $275 (AUD $400), and is repaid in an average of three to four weeks.
“We’re excited to collaborate with Western Union to support their customers with access to safe, affordable short-term lending,” said Beforepay CEO Jamie Twiss. “Beforepay and Western Union share a vision of providing inclusive financial services to aspiring consumers around the world.”
Western Union is bolstering its partnership with Visa by expanding its integration with Visa Direct.
Visa Direct is Visa’s real-time money movement network.
The expansion will bring Visa Direct to Western Union’s U.S. clients, enabling them to send money in near-real-time to Visa debit cards in Colombia, El Salvador, Jamaica, Romania, and Thailand.
Money transfer firm Western Union is building on its partnership with Visa this week. The Colorado-based company is expanding its integration with Visa Direct, Visa’s real-time money movement network.
Under the agreement, the pair will bring Visa Direct to Western Union’s U.S. clients, enabling them to send money in near-real-time to Visa debit cards in Colombia, El Salvador, Jamaica, Romania, and Thailand. Western Union and Visa first teamed up in 2019 to enable Western Union customers in more than 20 countries across Europe to send and/or receive funds directly to Visa debit card holders.
“Western Union and Visa share a vision for modern money movement, one that ensures cross-border payments are reliable, efficient and transparent, with convenience and the customer’s channel of choice at the center of our customer experience,” said Western Union President of the Americas Gabriella Fitzgerald. “Our partnership with Visa underscores the benefits that collaboration brings to realizing this shared vision for our joint customers around the globe.”
Visa first launched Visa Direct in Europe in 2017 as a real-time payments platform to allow companies to leverage Visa’s global reach and scale for cross-border payments. In addition to Western Union, nearly 550 partners, including Adyen, The Bancorp, Fiserv, and Stripe support Visa Direct solutions.
“Visa is transforming cross-border payments with Visa Direct by helping to bring the ability to securely send and receive funds in near-real-time to more use cases around the world,” said Senior VP North America Head Yanilsa Gonzalez-Ore. “Through this partnership, we are using Western Union’s digital capabilities to help US customers send money to their family and friends and provide a means to help with bills, as a gift, or for an emergency.”
Founded in 1851, Western Union is one of the oldest cross-border money transfer pioneers. The company’s global financial network bridges more than 200 countries and territories and approximately 130 currencies. In a partnership earlier this year, Western Union integratedMarqeta’s payment cards solution into its digital wallet and digital banking platform in Europe.
The U.S. Treasury’s U.S. Money Laundering Threat Assessment, published last December, says that many types of stored-value cards have the potential to become major avenues for money laundering, suggesting—although not saying explicitly—that stringent anti-money laundering regulations are in the offing for the card products.
Industry groups are preparing what amount to pre-emptive negotiations to keep the issue off the floor of Congress, hopefully minimizing potential regulations that could, in the view of many in the industry, cripple the business case for what bankers and other payments executives consider several promising new revenue streams. But prepaid-card executives are declining to speak publicly about the issue, hoping to keep public discussion about stored-valued cards “positive.”
Last Thursday, the day First Data Corp. announced its reorganization, Western Union announced it was out of the telegram business.
We understand the logic. Who sends telegrams in a world of emails and instant messaging? And though the company doesn’t say so, it’s hardly likely that the telegram business, on which the company was founded in 1851–as the Mississippi Valley Printing Telegraph Company–was a profit center. Dropping the business just made sense for a global payments company that makes $4 billion a year.
Still, it’s a melancholy milestone, in observation of which we share with you our favorite Western Union story:
Life Magazine was doing a story about Cary Grant in the 1950s and, not knowing his age, sent him a telegram reading “How old Cary Grant?” Grant replied “Old Cary Grant fine. How you?” (Contact: Western Union, 303-967-6416)
Last week’s news that First Data Corp. will spin off its Western Union operations to First Data shareholders and create a company worth an estimated $20 billion is probably good news for Western Union. Noting that the parent company will be keeping its card processing, card services, and international business lines, observers were asking what had otherwise changed.
The answer: Nothing. “The bottom line for me is that this doesn’t change the realities, which are that even though they’re going to reconstitute what First Data will be, it doesn’t change the facts that Western Union, while it’s a good business, is facing increasing competition around the world, that the card business is struggling mightily, and that merchant processing is a commoditized business,” says Scott Kessler, who follows First Data for Standard & Poor’s.
