In an effort to provide easy recharge facility to its MasterCard
) has made an agreement with the world's leading money transfer
Western Union Co.
Per the agreement, the cardholders can reload funds on their
cards at any of the 45,000 Western Union agent locations in the
The agreement with Western Union will enable MasterCard to offer
its customers with the largest reload network in the U.S with more
than 100,000 locations. The agreement will also make it very
convenient for other cardholders to recharge their card by visiting
the nearest Western Union agent locations and getting funds loaded
within a few minutes.
Last year, Western Union and MasterCard formed an alliance to
offer consumer-friendly prepaid card service across the latter's
multiple non-US locations. According to the agreement, the
prepaid card enabled cardholders to move money from Western Union
directly to MasterCard's credit, debit and prepaid cards, and vice
versa. The prepaid card could be refilled at all MasterCard rePower
locations as well as at about 485,000 global agent locations of
Yesterday's announcement to add Western Union's US locations is
a second step of the global partnership of the two companies. Both
companies are comfortable with the partnership, with MasterCard
preferring Western Union the most for money transfer service and
Western Union preferring MasterCard for offering its prepaid
programs across the globe.
MasterCard is aggressively penetrating the prepaid market. There
is an unexplored market for prepaid cards for the senior group of
the society, whereby MasterCard estimated about 2.5 billion adults
being underserved within the U.S. itself, while about 25% of this
group is devoid of any kind of a conventional financial payment
Hence, while a highly developed nation like the U.S. generates a
healthy opportunity for the simplified prepaid debit cards, we
believe that ample opportunities lay ahead for both these companies
in unbanked regions and other under-developed and developing
nations across the globe, where ATMs are absent.
Western Union currently retains a Zacks #3 Rank, which
translates into a short-term Hold rating. We are also maintaining
our long-term Neutral recommendation on its shares.
MASTERCARD INC (MA): Free Stock Analysis Report
WESTERN UNION (WU): Free Stock Analysis Report
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