Global remittance is the transfer of funds between people or institutions in different countries. The presence of money transfer organizations like Western Union has made it possible to send and receive the money within a few hours. Traditionally people sent money across borders using banks and big financial institutions. Sending money traditionally was prone to fraud and it took 2-3 days for the transaction to be complete.
Many families depend on a cross border payments network to send money to their relatives abroad for their daily needs. With technology, many people can receive money almost immediately after it is sent. All this is possible because of the digital transformation in the global remittance industry. These are some of the advances that technology has brought.
Money transfer operators can be faster than banks
One of the advances that technology has brought to global remittance is speed. Traditional global remittance solutions like banks took a few days to complete transactions, whereas digital transactions through MTO’s like Western Union take a considerably shorter time. As a customer, you can choose express delivery for your transaction to be completed faster.
MTO’s and the bank remittance monopoly.
People have for a long time depended on banks and forex brokers to send money across borders. This is now a thing of the past. The monopoly of banks and expensive forex brokers transacting money across borders is being faced out because of the technology the new money transfer operators are using. People can now use Western Union to send money globally without the stress of many hidden charges and fraud.
High exchange rates
Technology has improved the exchange rates. Initially, the banks and forex traders controlled the rates and they were very expensive. Small and mid-sized business owners struggled to get suitable exchange rates. Technology has introduced payment solutions that offer competitive exchange rates which are almost similar to the existing market rates. Now people can send enough money globally across currencies without worry.
Many global remittance companies like Western Union process transactions for free in specific regions up to a certain amount. Many companies do not have hidden charges like cancellation fees, amendment charges, or any other hidden charges. This helps customer trust and also the transaction costs are overall lower compared to traditional methods of global remittance.
Multiple payment methods.
International money transfer operators offer their customers many payment modes. At Western Union, you can make payments through your bank account in many countries, which can be cost-efficient.
Technology has enabled companies like Western Union to provide customers with multi-currency accounts. In these accounts, you do not have to worry about exchange rates because all your transactions are received in their matching currencies. This service is mainly used by freelancers, small and mid-sized businesses, online sellers, and more.
Technology has improved transparency in the global remittance industry. If you have a Western Union account you are provided with real-time updates if you make or receive any money. The idea for transparency is to also improve the security of the payments network. The Cross border payments network that Western Union has been able to build is secure.
With technology, global remittance as an industry has grown exponentially. After the pandemic hit, companies like Western Union took a little time to improve their systems and enable global remittance at a more efficient rate.
Founder Dinis Guarda
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