Western Union 2015 Annual Report Download - page 127

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We face competition from global and niche or corridor money transfer providers, United States and international banks,
card associations, card-based payments providers and a number of other types of service providers, including electronic,
mobile and Internet-based services, and from digital currencies and related protocols, and other innovations in technology
and business models. Our future growth depends on our ability to compete effectively in the industry.
Money transfer and business payments are highly competitive industries which include service providers from a variety of
financial and non-financial business groups. Our competitors include consumer money transfer companies, banks, credit unions,
card associations, web-based services, mobile money transfer services, payment processors, card-based payments providers
such as issuers of e-money, travel cards or stored-value cards, informal remittance systems, automated teller machine providers
and operators, phone payment systems (including mobile phone networks), postal organizations, retailers, check cashers, mail
and courier services, currency exchanges, and digital currencies. These services are differentiated by features and functionalities
such as brand recognition, customer service, trust and reliability, distribution network and channel options, convenience, price,
speed, variety of payment methods, service offerings and innovation. Distribution network and channel options, such as our
electronic channels, which include online, account based and mobile money transfer, have been and may continue to be impacted
by increased competition, including from new competitors and the consolidation of competitors and the expansion of their
services, which could adversely affect our financial condition, results of operations, and cash flows.
Our future growth depends on our ability to compete effectively in money transfer and business payments. For example, if
we fail to price our services appropriately, consumers may not use our services, which could adversely affect our business and
financial results. In addition, we have historically implemented and will likely continue to implement price reductions from time
to time in response to competition and other factors. Price reductions generally reduce margins and adversely affect financial
results in the short term and may also adversely affect financial results in the long term if transaction volumes do not increase
sufficiently. Further, failure to compete on service differentiation and service quality could significantly affect our future growth
potential and results of operations.
As noted below under risk factor "Risks associated with operations outside the United States and foreign currencies could
adversely affect our business, financial condition, results of operations, and cash flows," many of our agents outside the United
States are national post offices. These entities are usually governmental organizations that may enjoy special privileges or
protections that could allow them to simultaneously develop their own money transfer businesses. International postal
organizations could agree to establish a money transfer network among themselves. Due to the size of these organizations and
the number of locations they have, any such network could represent significant competition to us.
If customer confidence in our business or in consumer money transfer and payment service providers generally deteriorates,
our business, financial condition, results of operations, and cash flows could be adversely affected.
Our business is built on customer confidence in our brands and our ability to provide fast, reliable money transfer and
payment services. Erosion in customer confidence in our business, or in consumer money transfer and payment service providers
as a means to transfer money, could adversely impact transaction volumes which would in turn adversely impact our business,
financial condition, results of operations, cash flows, and our Cash Management Strategies.
A number of factors could adversely affect customer confidence in our business, or in consumer money transfer and payment
service providers generally, many of which are beyond our control, and could have an adverse impact on our results of operations.
These factors include:
• changes or proposed changes in laws or regulations or regulator or judicial interpretation thereof that have the effect of
making it more difficult or less desirable to transfer money using consumer money transfer and payment service providers,
including additional customer due diligence, identification, reporting, and recordkeeping requirements;
• the quality of our services and our customer experience, and our ability to meet evolving consumer needs and preferences,
including customer preferences related to our digital services, which include our westernunion.com and mobile money
transfer services;
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