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Protocol | Fintech

Western Union is about to turn 170. It still thinks it can win the fintech wave.

"We're not just a digital-only player or a retail-only player."

Western Union is about to turn 170. It still thinks it can win the fintech wave.

Western Union CFO Raj Agrawal

Western Union

Western Union is not one of the stars of the fintech revolution, but it is a trailblazer in financial technology.

A decade after it was formed in 1851, the company set up the first transcontinental telegraph cable. That made it possible to send telegrams and wire funds across the country and soon the world, creating a network of retail money transfer outlets in more than 200 countries.

Along the way, the company embedded itself in American popular culture, from singing telegrams to candy-grams to an improbable cameo in "Back to the Future II," when a Western Union man hand-delivered a 70-year-old letter to Marty McFly.

As it gets ready to mark its 170th anniversary, Western Union is one of the oldest players riding the fintech wave. But don't call it low tech or think of it as slow-moving around Chief Financial Officer Raj Agrawal. He said the company is speeding things up, whether that's expanding their digital business into more countries or testing out blockchain technology.

The Denver-based company still has more than 550,000 agent locations for money transfers in almost every country in the globe. But at a time when fintech startups are disrupting the way people move money, Western Union is focused increasingly on its digital business,, which now reaches 75 countries.

The company has taken hits from the pandemic. It posted a year-over-year dip in revenue in 2020 when global remittances took a plunge. But Western Union, which has a market cap of about $10 billion, has been viewed favorably on Wall Street: Its stock is up about 14% year-to-date.

In an interview with Protocol, Agrawal talked about Western Union's game plan in the fast-changing fintech market and why he thinks the company has key advantages over its much younger — if less profitable — rivals.

This interview has been edited for clarity and brevity.

Western Union is one of the early fintech companies, though it's probably known as a low-tech fintech company. How are you adapting to the fintech trend?

First of all, I have not actually heard the words "low-tech fintech" [laughs].

I just made it up.

My goal then is for you to never say that again [laughs].

That's the misconception of Western Union. In our original core traditional business, we're very high-tech. We move money in minutes around the world. It doesn't happen with a stagecoach. It doesn't happen because we're carrying bags of cash around the world.

We really are transferring information. That's the way we move money around the world and we actually do it better than traditional channels that have been available to move money. It's the technology that allows us to settle in 130 currencies globally. It's a really good competitive moat that we have that we've continued to build upon over the many years. We allow customers to transact with us in any way they want. They can go to a retail location, or they can go to our online site.

There has been an explosion in technologies related to payments and cross-border payments. What has been the most surprising to you?

What I see in the market, then is that there are many companies who are operating, it seems, forever at a loss. They're not sustainable business models. I'm not sure what their endgame is. We are aware of the competition that exists all around the world, but we believe that we have a better offering for consumers on a global basis.

Fintech is changing the way money moves overseas, especially in Asia and Africa. What is the future of Western Union's retail system?

We are absolutely evolving with the market needs. Everywhere in the world we can send money from a retail location. We're agnostic as to how consumers want to use us. If there's a need that you have one day to send money because you happen to be shopping at a Safeway, we want you to be able to do that. However, if the next time you want to send money you're going to use our app, no problem. We're not just a digital-only player and we're not just a retail-only player. We're omnichannel.

What fintech trends are most exciting for you?

The biggest thing for us is our almost 9 million consumers on How do we extend the service offerings to them so we go even further beyond the remittance market? We're looking at launching a pilot later this year which is going to allow consumers to have more banking service offerings from Western Union. We're launching this pilot in a handful of markets in Europe.

So you're considering expanding into banking?

We already have a bank in Austria. We're going to be leveraging the bank and the bank license to provide more financial services to consumers. It could be a credit card. It could be a debit card. We obviously want the account relationship with the consumer.

We're going after a migrant customer who is using our services. They are comfortable with the Western Union brand. They're moving money to their loved ones already and we want to extend the relationship with them.

How do you view the rise of cryptocurrency?

There has been a lot of talk about cryptocurrency and blockchain technology. We haven't currently found a great use case for those things, but we're always evaluating new technologies. We settle in 130 currencies today with consumers all around the world. So for us, if there was a real demand for cryptocurrency from a consumer standpoint to start, we would absolutely be able to offer that. [But] it's not likely that consumers want to transact in cryptocurrency for a $200 or $300 transaction. It's just not what they're looking for. It's not even in their thoughts when they're thinking about sending money to their loved ones. That's sort of obvious.

We evaluated blockchain technology and we have done some specific testing there. We want to see if we get better foreign exchange rates. Can we save time? Is it more transparent for the consumer or for us? Can we move money around the world easier? The answer to all those thus far has been: no, no, no, no and no.

What is the fintech trend that worries you most?

The thing that we always think about is: Why can't we move faster? We have some great plans for the next three years. I would love for us to accomplish them in the next 12 months. We would love to have in 200 countries in the next 12 months. I don't want to wait three years to get there. The market as you know it is moving at a very fast pace, and we just want to keep doing everything we can to remove the internal roadblocks to being able to move fast.

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