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Monday May 16, 05:42
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US credit unions turn to new business
(by Dr.Goldfinger)
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The US credit unions are expected to turn to immigrant business taking a huge piece of the annual $34 billion program. The market is now dominated by such money transfer giants as Western Union and MoneyGram.
With the US Congress passing a new bill, the situation around a fussy transfer market will change inevitably, analysts say. Medium and small money transfer businesses face tough times under the current laws. Some of smaller companies were even forced to be closed dwindling the transfer of money among immigrants, market data shows.
The new bill, expected to be adopted by the Congress, will be less costly for immigrants with the fees that are lower than those of Western Union, a unit of First Data Corp., of Greenwood Village, Colo., and MoneyGram International Inc., of Minneapolis.
Credit unions will also be allowed to offer money-transfer and check-cashing services to all eligible potential members.
There are about 1,700 so-called community credit unions in the US today. They are usually formed to serve a particular town or city. The number of federal- and state-chartered credit unions in the US amounts to 9,000 functioning as a provider of deposit accounts and loans. Their rates, though, are considered to be more favorable than those of commercial banks.
Most money-transfer companies are now providing their services via IRnet, a service established by the World Council of Credit Unions to help lower the cost of remittances within seven countries.
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