Saturday, February 20, 2010

The relevance of Western Union certifications

Western Union announced a vendors program some time ago. The intention of this program was to enable software vendors to develop mobile payment applications that can integrate to the Western Union remittance hub. Such an integration would enable scenarios where the Western Union agent network would be able to remit through other distribution channels (specifically mobile operators agents).

During the week of the MWC, Western Union announced that they have now certified the first two vendors to integrate to the Western Union remittance hub. The two companies are Fundamo and mCheck. (Read here). It is now possible to license these platforms, contract with Western Union and connect to the biggest remittance network in the world.

Many aspects and implications to the industry of the announcement of the certification, should be highlighted:
  • Western Union demonstrated the ability to license third party software vendors. This is not as easy as it sounds and means that Western Union has developed a competitive capability that other remittance hubs seem not to have.
  • The approach of allowing independent third party vendors is a move that could trigger a lot of activity. This is an open, transparent approach that will ultimately extend the reach of mobile financial services.
  • The focus on mobile operators is interesting from many angles (this blog does not have enough space to do justice to this topic). By partnering with Mobile Operators, Western Union will create much significantly more distribution points than would be possible if they limit their relationships with (for instance) banks.

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