China’s biggest messaging app is partnering with Western Union to make it easier to send money to China, the US, and 200 more countries.
Tencent, which owns WeChat, a China-based messaging service with 600 million active users, and Western Union announced a partnership with Tencent’s popular payment service. Under the arrangement, which became effective in the US today, users will be able to log in to their WeChat app and send money from their bank account—or by using credit or debit cards—to either a Western Union retail location, or to bank accounts or digital wallets, where available.
The deal underscores the growing interest from corporations in tapping into the $440 billion global remittance business and the money transfer business more broadly. Facebook Messenger earlier this year added a feature allowing people send money to friends. And Snapchat partnered with Square to offer the same, “Snapcash.” Apple also looks to be interested in the world of payments, according to recent reports.
While these services are essentially loss leaders, technology companies hope that by embedding themselves in the financial lives of users, they’ll make it more difficult to move on to the next hot technology trend that will emerge someday. In cross border payments, these companies also see the opportunity to make themselves central to the online lives of millions of newly connected consumers in emerging markets such as India and China.