Despite a tough year, digital transfers shined for Western Union – Digital Transactions

Embarrassed at first by Covid-19, The Western Union Co. said on Wednesday evening that its growing digital transfer business had helped support its results for the fourth quarter and the full year. Overall, digital transfer revenue, including activity on Westernunion.com, grew 36% in the fourth quarter year-over-year and accounted for just over one-fifth of total revenue from consumer to consumer, the company said. At the same time, digital activity has ensured almost a third of consumer transactions.

Digital activity hit records in terms of transactions and revenues over a quarter, Western Union noted. The company has not released absolute numbers. On its own, the website saw its average monthly active customer count increase by 49% in the quarter compared to the same period in 2019, as consumers flocked to the internet for domestic and cross-border money transfers.

Executives at the Denver-based company highlighted the growing importance of its digital business in the face of the ongoing pandemic. “As we begin 2021, uncertainty remains high, but we are optimistic that business will continue to improve gradually, with expectations that our digital revenues will reach around $ 1 billion in 2021,” said Hikmet Ersek, president and chief executive officer, in a press release.

Overall, consumer-to-consumer transfers in the quarter increased 6% year-on-year to 78.4 million, although the total of 290.5 million for the year was stable from the total of 2019, indicating that the channel gained momentum in the second half of 2020 after experiencing quarterly declines in the first half of the year, when the pandemic first took hold.

Western Union’s $ 1 billion goal for its digital service comes as new companies like Remitly and TransferWise grow rapidly with digital transfers, notes Robert Napoli, analyst at Chicago-based William Blair & Co. At the same time, Western Union reached an agreement in January with Walmart offer national and cross-border transactions in 4,700 stores.

For the quarter, the Denver-based company reported revenue of $ 1.27 billion, down 3% year-on-year. Revenue for the year totaled $ 4.84 billion, down 9% from 2019. The consumer-to-consumer business accounts for approximately 87% of total revenue.