Recent news revealed that WeChat, the biggest messaging app in China, is striking a deal with Western Union to make transferring of money to U.S., China and 200 additional countries easier.
Tencent owns WeChat, a China-based messaging service that has 600 million dynamic users, with announcement of a partnership with the popular payment service of Tencent from Western Union. Users will be able to log in to their WeChat app and send money by making use of credit or debit cards – or from their account – to either digital wallets, bank accounts or Western Union retail location, where available, under this arrangement, which became effective in the U.S.
This partnership for international money transfers gives emphasis to the growing interest from corporations in tapping into the $440 billion international money transfer business as well as remittance business more broadly.
Earlier this year, Facebook Messenger included a feature that allows its users to send money to their friends, while Snapchat partnered with Square to provide similar service known as Snapcash. According to recent reports, Apple also seems to be interested in the world of payments.
Technology companies expect that they will make it more complicated to move on to the next blistering technology trend that will emerge someday, by embedding themselves in the financial lives of users, while these services are essentially loss leaders.
These companies also see the chance of making themselves central to the online lives of a lot of newly connected consumers in growing markets like China and India, in cross border payments.