Global payment services player Western Union plans to get aggressive in the domestic market by participating in financial inclusion with its prepaid card, which was launched in October last year.
“Almost half of India doesn’t have a bank account and people have started looking for alternative methods. The Business Correspondent (BC) construct also has not been used properly. We would want to bring Western Union here as we could be linked through the bank as a BC by aiding financial inclusion and also make money,” said Kiran Shetty, Managing Director, Western Union India.
Western Union is talking to organisations regarding opportunities in this space. “The intent is always there. Also, there aren’t many opportunities for people in rural areas. They trust banks but there aren’t enough branches, Shetty said.”
Western Union wants to capitalise on this gap by relying on its brand and distribution.
However, with competition from players such as India Post, pricing will be crucial. With withdrawal charges of Rs 25 from a non-ICICI Bank ATM, Rs 100 for a new card issuance and re-issuance for a lost card, among others, might limit customers, especially the poor, to accept this change.
Being one of the largest remittance players, Western Union had entered into the domestic prepaid card market partnering the largest private sector lender ICICI Bank, under the MasterCard network. The card helps load a maximum amount of Rs 50,000 onto the card and make payments across the country.
According to Shetty, “Largely, we are serving blue-collared workers, who have no bank accounts and these workers have no amount limit issue but frequency issue. This is a new category and we will not be just limited to payments but want to promote more such products this year.”