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Western Union has been around since the 1850s, but that doesn’t mean it’s stuck in the past.
The money transfer leader recently participated in a funding round for Digital Currency Group (DCG), a firm that collaborates with financial institutions to develop use cases for blockchain technology outside of digital currencies such as Bitcoin.
DCG thinks Western Union could use its worldwide network to help DCG identify pain points tied to money transfers across borders.
Blockchain technology could revolutionize digital remittance. Western Union has been improving its digital segment and digging into blockchain technology, which uses a distributed ledger to increase efficiency across the financial industry. This, in turn, could reduce the cost of remittance services.
Migrants paid an average of 5.9% in fees on money transfers in 2014. Blockchain technology could streamline the process and reduce infrastructure cost for remittance companies, which could mean lower transfer rates for consumers.
The numerous partnerships between legacy financial companies and disruptive startups is proof that we’ve entered the most profound era of change for financial services companies since the 1970s brought us index mutual funds, discount brokers and ATMs.
No firm is immune from the coming disruption and every company must have a strategy to harness the powerful advantages of the new fintech revolution.The battle already underway will create surprising winners and stunned losers among some of the most powerful names in the financial world: The most contentious conflicts (and partnerships) will be between startups that are completely reengineering decades-old practices, traditional power players who are furiously trying to adapt with their own innovations, and total disruption of established technology & processes: Traditional Retail Banks vs. Online-Only Banks: Traditional retail banks provide a valuable service, […]
