Western Union 2010 Annual Report Download - page 8

(a) The geographic split is determined based upon the region where the money transfer is initiated and the region
where the money transfer is paid. For transactions originated and paid in different regions, we split the revenue
between the two regions, with each region receiving 50%. For money transfers initiated and paid in the same
region, 100% of the revenue is attributed to that region.
(b) Represents the Europe, Middle East, Africa and South Asia region of our consumer-to-consumer segment,
including India.
(c) Represents the Americas region of our consumer-to-consumer segment, which includes North America, Latin
America, the Caribbean and South America.
(d) Represents the Asia Pacific region of our consumer-to-consumer segment.
Financial information relating to our international and domestic revenues and long-lived assets for all of our
segments is set forth in Note 17 to our Consolidated Financial Statements in Item 8.
For additional details regarding our consumer-to-consumer and global business payments segments, including
financial information regarding our international and United States operations, see Item 7 of Part II and our
financial statements and the notes to those statements included elsewhere in this Annual Report on Form 10-K.
See Risk Factors for a discussion of certain risks relating to our foreign operations.
Consumer-to-Consumer Segment
Individual money transfers from one consumer to another are the core of our business, representing 84% of our
total consolidated revenues for 2010. We offer consumers a variety of ways to send money. Although most
remittances are sent from one of our more than 445,000 agent locations worldwide, in some countries we offer the
ability to send money over the internet or the telephone, using a credit or debit card, or through a withdrawal directly
from a consumer’s bank account. All agent locations accept cash to initiate a transaction, and some also accept debit
cards. We also offer consumers several options to receive a money transfer. While the vast majority of transfers are
paid in cash at agent locations, in some places we offer payout directly to the receiver’s bank account, to a stored-
value card, to a mobile phone or through the issuance of a money order.
Operations
Our revenue is derived primarily from transaction fees charged to consumers to transfer money. In money
transfers involving different send and receive currencies, we also generate revenue based on the difference between
the exchange rate set by Western Union to the consumer and the rate at which we or our agents are able to acquire
currency.
In a typical money transfer transaction, a consumer goes to one of our agent locations, completes a form
specifying, among other things, the name and address of the recipient, and delivers it, along with the principal
amount of the money transfer and the fee, to the agent. This sending agent enters the transaction information into
our money transfer system and the funds are made available for payment, usually within minutes. The recipient
enters an agent location in the designated receiving area or country, presents identification and is paid the
transferred amount. Recipients do not pay a fee (although in limited circumstances, a tax may be imposed by the
local government on the receipt of the money transfer). We determine the fee paid by the sender, which generally is
based on the principal amount of the transaction and the send and receive locations.
We generally pay our agents a commission based on a percentage of revenue. The commission is shared between
the agent that initiated the transaction, the “send agent,” and the agent that paid the transaction, the “receive agent.”
For most agents, the costs of providing the physical infrastructure and staff are typically covered by the agent’s
primary business (e.g., postal services, banking, check cashing, travel and retail businesses), making the economics
of being a Western Union agent attractive. Western Union’s global reach and large consumer base allow us to attract
agents we believe to be of high quality.
To complement the convenience offered by our network’s global physical locations, in certain countries we have
also made our services available through other channels, as described below under “Services.”
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