Western Union Sees Significant Increase in Use of Chinese Renminbi for Business Payments by U.S. Fir
Western Union Sees Significant Increase in Use of Chinese Renminbi for Business Payments by U.S. Firms
ENGLEWOOD, Colo.--(BUSINESS WIRE)-- Western Union Business Solutions, a business unit of the Western Union Company (NYS: WU) , a leader in global payment services, has seen increased client appetite for making payments to China in its local currency, the Renminbi (RMB).
"Businesses around the world are reevaluating how they transact business with China," said Alfred Nader, Vice President of Corporate Strategy & Development, North America, at Western Union Business Solutions. "While the vast majority of the payments we send are still being made in U.S. dollars, in a very short period of time we have seen a surge in the number and value of payments companies are sending to China in Renminbi, particularly among small and medium sized businesses."
Western Union Business Solutions' American clients increased the number of RMB payments to China by over 15% in the second quarter of 2012 compared to the previous quarter. In the UK, RMB payments rose nearly 10% over the same period, while France and Australia recorded increases of approximately 30% and 25% respectively.
Mr. Nader continued, "Recent policy developments in China have dramatically altered the trade-related payments landscape, enabling businesses globally to pay in Renminbi. We were the first non-bank to launch direct RMB payments just over a year ago and since then we have seen steady growth. It is of course against a low base but we are talking with our customers about the new policies, which has clearly made a difference."
"SMEs are starting to take advantage of the opportunities and potential cost savings RMB usage can offer; the fact that they now have the option to pay in Renminbi is clearly a good thing."
Increasing RMB payment volumes are consistent with the findings of research conducted by Western Union Business Solutions late last year that revealed a desire by Chinese companies to receive payments in RMB; 20% of the companies surveyed stated they added fees of, on average, three percent to their invoices to cover foreign exchange costs, representing an estimated $2.4 billion cost to American businesses.1
Mr. Nader concluded, "It's encouraging to see American businesses adapting to the new environment to gain a competitive edge in their negotiations and shave off some of the hidden costs they can incur when paying in the U.S. dollar."
Notes to Editors:
About Western Union Business Solutions
Western Union Business Solutions enables companies of all sizes to send and receive international payments and manage foreign exchange, creating unique solutions tailored to suit their FX needs. Western Union is a leading nonbank provider of business payments, operating its Business Solutions services through locally licensed affiliates and partners in 28 countries. Supported by a network of trading offices, strategic banking relationships and a proprietary global clearing network, businesses can send cross-border payments in more than 135 currencies, including RMB. Customers are able to make RMB spot transactions and forward payments and manage Renminbi-denominated holding accounts.
Western Union Business Solutions provides services in the U.S. through Custom House (USA) Limited and Travelex Global Business Payments, Inc.
"Travelex" is a registered trademark of Travellers Exchange Corporation Limited and is used by Travelex Global Business Payments Limited and its affiliates (including Travelex Global Business Payments Inc.) under license.
For more information, visit http://business.westernunion.com/.
About Western Union
The Western Union Company (NYS: WU) is a leader in global payment services. Together with its Vigo, Orlandi Valuta, Pago Facil and Western Union Business Solutions branded payment services, Western Union provides consumers and businesses with fast, reliable and convenient ways to send and receive money around the world, to send payments and to purchase money orders. As of June 30, 2012, the Western Union, Vigo and Orlandi Valuta branded services were offered through a combined network of approximately 510,000 agent locations in 200 countries and territories. In 2011, The Western Union Company completed 226 million consumer-to-consumer transactions worldwide, moving $81 billion of principal between consumers, and 425 million business payments. For more information, visit www.westernunion.com.
1 Research conducted by Western Union Business Solutions found that one in five Chinese exporters added an average of three percent in fees or surcharges to account for FX risk associated with receiving $USD payments. Based on the U.S. Census Bureau figures for 2011, there was $399 billion worth of merchandise imports from China into the United States. On this basis the value of FX related fees charged by Chinese exporters is approximately $2.4 billion, or three percent of the value of one-fifth of the United States' total imports from China.
For more information or interviews please contact:
Western Union Business Solutions
Jennifer Berlin, +44 207 426 4457/+44 779 549 7129
John McInerney, 212-508-9628/646-291-7024
KEYWORDS: Australia United Kingdom United States Europe Asia Pacific North America Australia/Oceania China Colorado France
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