Digital Transactions Authoritative, insightful and timely information for payments professionals
Facing increasing competition from digital money-transfer upstarts, wire-service giant Western Union Co. is making alliances to add value to its traditional money-movement product. This week, it announced a deal with Skype, the video-calling service, which allows Skype users to top up their accounts by handing over cash at Western Union locations in the United States.
A unit of Microsoft Corp., Skype offers its users Skype Credit accounts for calls to mobile and landline endpoints around the world. Rates start at a penny per minute, according to a Western Union news release on the partnership. Skype Credit can also be used to pay for text messages to recipients’ mobile phones. Calls between the hundreds of millions of Skype users are free, but users must tap Skype Credit when calling on mobile or landline connections.
The new service relies on Western Union’s Quick Collect consumer-to-business payments network, available at more than 50,000 locations, including banks and stores. The company claims that “many” of Skype’s 300 million active users are also Western Union customers.
“The relationship is a logical one, as both Western Union and Skype have a mission to connect people when they are apart,” said Odilon Almeida, president for the Americas and the European Union at Western Union, in a statement. “Skype is a classic example where customers can enjoy full digital access with a walk-in payment option.”
Western Union has moved in recent years to blunt competition by making it easier to access its money-transfer network. Last fall, for example, it struck a deal with Walgreen Co. to make money transfers available at photo kiosks in 7,650 Walgreen and Duane Reade stores.
All-digital rivals like Xoom Inc. have nipped at the heels of traditional providers like Western Union and Moneygram International Inc. Xoom has worked to expand mobile access to its services, for example. But earlier this year, Xoom sustained a setback when it was hit by a $31 million fraud.
