Which bank does Western Union use to hold agent accounts, does it require agents to use that same bank, and how does that bank profit from the relationship?
Banking
Asked by Question Bot01/May/20171 answer
1 Answer
F
Faisal Khan
Answered 01/May/2017
Western Union uses a multitude of banks, where ever in the world they operate. As with any MTO, they like to spread their monetary holding amongst various banks.
This is true for all countries. For example in Philippines, they use 3 banks. In Pakistan, WU has accounts with 4-5 banks, in Australia, 2 banks. etc.
The agents typically have their accounts in the same bank as WU (makes intra-account transfers easy).
The bank is simply earning on average balance being maintained in the account, and this average balance is used for over-night lending.
In some cases, the bank's FX desk is providing the rates to WU, so they make additional income from trading currency pairs as well.
This is true for all countries. For example in Philippines, they use 3 banks. In Pakistan, WU has accounts with 4-5 banks, in Australia, 2 banks. etc.
The agents typically have their accounts in the same bank as WU (makes intra-account transfers easy).
The bank is simply earning on average balance being maintained in the account, and this average balance is used for over-night lending.
In some cases, the bank's FX desk is providing the rates to WU, so they make additional income from trading currency pairs as well.