Since 1871, Western Union (WU) provides a money transfer service without the requirement that its users must have their own bank accounts.
Back then, the telegraph network was used – today the Internet. However, the fact remains that the money receiver can withdraw the money only a few moments after the deposit … and since 1980, this even if it is at the other end of the world!
Western Union is mainly used by migrant workers. They work in the “Western” world (e.g. in Germany) and send money regularly to their families in their poorer home countries. In 2004 (so the last known information), the equivalent of about 8 billion Euros was sent only from Germany to foreign countries.
However, Western Union is also used to transfer money between Germany and other countries, if one does not have a bank account or does not want to use it. For example, for “discrete” money transfers.
Branch office or online?
Migrant workers often use the deposit service at the WU counter. In Germany, one can find such counters at the Reisebank, Postbank and often in Internet cafés.
Also some travel agencies or specialty stores, which were founded by immigrants, serve as deposit and withdrawal points of Western Union. Any businessman can suggest Western Union to become a partner and open a “branch office”.
Additionally, the Western Union Bank has quite some branch offices in Germany.
Set up an online account at WU!
If you want to transfer money abroad only once, then you probably do not need an online account (it is not a bank account!) at Western Union. However, if you transfer money regularly, we strongly recommend you to open an online account, because
- You save the way to the Western Union counter (time and possibly transportation expenses),
- You can save addresses and data online and do not have to fill out the form every time again,
- You transfer cheaper (the online fees are lower).
Setting up an online account is free:
Note: You can set up an account already at the first money transfer. Legitimating is necessary only at the third money transfer. So everything is very simple!
New note: If you are still new in international transfers, then take a look at the alternative TransferWise. In our last tests, TransferWise came off much better than Western Union.
You do not have to charge the Western Union account before the transfer. The sent amount will be deducted from your bank account or your credit card at the same moment in which the money is sent.
Criticism towards Western Union
The fees of Western Union have always been the long-running criticism. Even the World Bank has already dealt with the topic.
Western Union earns at two points:
the transfer fees
Are very transparent, as the online calculator always shows them up to date. However, the fees for small amounts can be up to 15% of the transfer amount and at higher amounts, bank transfers (even if they take longer) are cheaper due to the better exchange rates.
the exchange rates
Compared to banks, Western Union provides the customer with very poor exchange rates. It works like this: WU exchanges the money from one currency to another at wholesale rates, but surcharges the customer with a huge percentage fee.
Although the exchange rate for the transaction is shown before every online transfer, the surcharge remains unclear. In our test (article in German language) of possibilities to transfer money cheaply to the USA, the surcharge on the exchange rate, compared to a bank transfer, was about 3.85 percent!
Western Union is market leader, despite criticism!
Despite criticism of the high fees, Western Union is used daily by millions of people and is the market leader of the international money transfer.
Three other points still play an important part:
To use Western Union, you only need an identification document and money (sender) as well as an identification document and the Money Transfer Control Number (MTCN) (receiver). A bank account is not necessary. Thus, almost everybody can use Western Union around the globe.
Already a few seconds after the deposit, the money can be picked up from the paying branch office.
The money transfer with Western Union is one of the safest ways to transfer money. Each payment receives a unique Money Transfer Control Number (MTCN). This payment can be traced at any time. Simply call the customer service and test it!
The money can only be picked up by the person defined by the sender. He/She has to legitimize the identity using an identification document and the MTCN as well as knowing the amount and the sender. In some countries, a password is used additionally.
How the money transfer with Western Union works (using the Internet):
The online transfer form will open
Confirmation via e-mail
Please provide the money receiver with the following data for withdrawal:
- Money Transfer Control Number (MTCN)
- Amount to be picked up
- in some countries also a password
Your name and your contact data should also be known to the receiver!
Money pick up
Often, Western Union is not the cheapest option, but it offers the fastest and one of the safest! If you want to perform more than one transfer, we recommend setting up an online account: www.westernunion.de.
PS: You are welcome to add your experiences with Western Union to this page – perhaps a money transfer from Germany to a foreign country or the other way around. Thank you!
New: Cheap alternative to Western Union
Thanks to the inventing spirit of people, our world keeps developing and supplies new products and offerings. These are often cheaper, better or faster than the already established one.
That also applies to TransferWise, a new provider of very cheap transfers to the abroad.
If the sent money should not be picked up in cash – which is the big advantage of Western Union – but should be transferred from bank to bank … than you should take a look at www.transferwise.com Good luck!