nav
Business Operations Business Models

How Does Western Union Make Money (Business and Revenue Model)

The Western Union business model

Western Union logo
Here’s what you should know:
  • What is Western Union, and how does Western Union work?
  • How does Western Union make money?
  • Transfer Fees (when Sending Money)
  • Pay Bills Service
  • Western Union subsidiaries, acquisitions, and exits
  • Western Union profit and revenue
  • What is the Western Union business and revenue model?
  • Western Union funding, net worth, and market cap

How does Western Union make money? Well, here is a full, in depth, breakdown of their two (2) revenue streams and the different products and services they offer, as well as the Western Union business and revenue model, how much Western Union makes per year, and how Western Union works.

What is Western Union, and how does Western Union work?

Western Union is a financial service company that allows customers to send and receive money internationally

Founded in 1851 by Ezra Cornell, Hiram Sibley, Jeptha Wade, and Samuel L. Selden, Western Union began trading on the New York Stock Exchange (NYSE) on January 26, 2006, under the ticker symbol “WU”.

Today, Western Union handles more than $109 billion USD of transactional volume each year for more than 150 million customers across 200+ countries and territories.

So, how does Western Union work? To send or receive money using Western Union, you can do so by simply either visiting one of there 500,000 retail locations around the world or by going to their website.

Some of Western Union’s competitors include PayPal, Cash App, TransferWise, Venmo, Skrill, Zelle, Apple Pay, Google Pay, and other money transfer services.

Western Union App in Apple App Store | Western Union Business Model | How Does Western Union Make Money? | How Does Western Union Work?
Source: Apple App Store | Western Union

How does Western Union make money?

According to Western Union, Western Union facilitated more than $109 billion USD of transactional volume between customers sending money to each other in 2021.

So how does Western Union make money off of all that transactional volume?

Below is a breakdown of how much money Western Union makes and its revenue model. Including all revenue streams and how much they charge for their services.

Here are the 2 ways of how Western Union makes money in 2022

Western Union has a revenue model that makes money in two (2) ways; transfer fees from sending money and fees from their Pay Bills service.

#1. Transfer Fees (when Sending Money)

Western Union makes most of its money from the transfer fees they collect when customers send money to each other. In fact, $4.4 billion or 87% of Western Union’s total revenue came from these customer-to-customer transfer fees in 2021.

As noted above, Western Union handled more than $109 billion USD of transactional volume between customers in 2021. Of which, they received a transfer fee of 0% to 6% on all of it.

How much are Western Union money transfer fees?

  • 0% to 6% per transfer (fees vary by currency, which you can see by zooming in on the image below)
western union transfer fees chart | Western Union Business Model | How Does Western Union Make Money? | How Does Western Union Work?
Source: Western Union | transfer fees chart

Note: 87% of Western Union’s total revenue came from customer transfer fees in 2021.

#2. Pay Bills Service

Western Union also makes money from its “pay bills” service. Which, in 2021, generated roughly $255 million for Western Union.

This service allows customers to pay for their bills using Western Union by sending their payment(s) directly to businesses. Customers can pay either pay online with a debit / credit card or pay in-store with cash or alternative. Both options have come with their own fees, which you can see below.

How much does Western Union pay bills service cost?

  • Pay in-store: $4
  • Using a debit or credit card: $9.99

Western Union subsidiaries, acquisitions, and exits

To date, The Western Union Company has made a total of 4 acquisitions, 4 investments, 1 lead investment, and 1 successful exit.

Mergers and acquisitions business model
Source: Crunchbase | Western Union

Western Union profit and revenue

In 2021, Western Union reported $5.07 billion in revenue.

Note: Because The Western Union Company is a publicly traded company under the Securities Exchange Act of 1934, they must file continuous financial filings with the U.S. Securities and Exchange Commission (SEC). You can find all of Western Union’s publicly released financial reports, including annual reports, through Western Union’s investor section on their website.

What is the Western Union business and revenue model?

Western Union makes money through a few revenue models that they combine within their company, they are:

  • Fee for service (FFS) business model
  • Business to business (B2B) business model
  • Mergers and acquisitions (M&A) business model

Western Union funding, net worth, and market cap

As of July 2022, Western Union has a market cap of $6.48 billion.