Frankfurt The US payment service provider Western Union is launching a current account for smartphones in Germany. It’s the first time Western Union, best known as a cash transfer service, has offered a checking account. First, there is the “WU+” account in Germany and Romania.
“In the next step, the offer will be introduced in Italy and Poland and will eventually be rolled out throughout Europe and other markets worldwide,” Western Union said on request. The necessary banking license for the EU comes from the Western Union International Bank in Vienna.
With the checking account via app, Western Union is competing primarily with financial start-ups (fintechs), which also primarily rely on smartphone accounts. The payment and retail service provider Klarna has also been offering a current account in Germany for over a year. Like N26 and now also Revolut, Klarna also works with its own banking license.
However, the competition is fierce. Traditional banks are also trying to modernize apps and online banking. In addition, online banks – in Germany, for example, ING and DKB – are mainly courting young customers. So far, “WU +” is only available for banking via app, but a desktop version for classic online banking is planned, as Western Union announced.
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The checking account should be primarily intended for customer loyalty. You can already send money via the Western Union app. One of Western Union’s competitors is British fintech Wise (formerly Transferwise).
Fee may be due
As with Wise, “WU+” customers receive a Visa debit card. It is obvious that Western Union also wants to use the new offer to stand up to Wise in Europe.
Similar to many neobanks and online banks, the standard variant of the Western Union account does not require a monthly fee. The premium account costs 3.99 euros per month. In addition, a fee may be charged for certain individual transactions.
For example, depending on the account model, ten or 20 transfers per month between “WU+” accounts are possible, after which they cost 50 cents each. It is similar with domestic transfers. There are also exchange rate surcharges if two different currencies are involved. A fee will be charged for incoming transfers from other currencies.
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