Although the growth of debit card payments may be slipping, the use of a debit card number as a proxy for a bank account to receive funds is expanding. Street Insider and other news outlets announced the launch of a service offered by Western Union to push funds to a debit card using Mastercard Send. Note that funds can be sent to any card, not just those branded Mastercard.
Today Mastercard (NYSE: MA) and The Western Union Company (NYSE: WU) announced they are working together to integrate Mastercard Send into the Western Union Money Transfer® service, allowing Western Union to deliver funds to virtually all U.S. debit cards. The alliance opens a new channel for U.S. consumers to quickly and conveniently send money via Western Union to the debit cards people use every day, including non-Mastercard cards. Western Union is the money transfer industry’s first to offer the debit card-enabled service via the Mastercard Send platform in the United States.
The new Western Union service, expected to be available in early 2018, will initially offer digital funds transfers within the U.S. via westernunion.com and the WU mobile app, enabling senders to use their U.S. debit, credit and bank accounts to fund a payment. Customers simply need to know the recipient’s 16-digit debit card number to complete the transfer.
Using cards through one of the network push payment network is considered a better consumer experience since only the card number needs to be known, rather than an R/T and checking account number. The push payment networks also have (or will have) the capability to deliver transactions globally, but I wouldn’t look for that service to be offered by a money transfer operator unless they can also control the compliance and foreign exchange aspects.
Overview by Sarah Grotta, Director, Debit Advisory Service at Mercator Advisory Group
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