Western Union to Cut Prices for Money Transfers Within U.S.

Wednesday, February 11, 2015

Western Union Co (WU.N) said it would cut prices for money transfers within the United States to help fend off fierce competition and would buy back up to $1.2 billion of shares.

Shares of the world’s largest money transfer company, which also raised its quarterly dividend, rose 4 percent to $19.20 in extended trading.

Western Union is cutting prices in parts of the United States where it is experiencing the maximum competitive pressures, company executives said on a conference call.

Rival MoneyGram International Inc (MGI.O) slashed prices in October in response to Wal-Mart Stores Inc’s (WMT.N) money transfer service launched last year.

Western Union, which gets about 80 percent of its business from low-income migrant workers sending money home, said revenue in its U.S. money transfer business had been hurt by increasing competition, but it did not provide numbers.

North America accounts for 19 percent of its total revenue.

“We do not expect significant price changes in our cross-border business,” Chief Financial Officer Raj Agrawal said.

Source: Reuters (link opens in a new window)

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