Western Union Shareholder Resolution 2008

Western Union Community Reinvestment Policy


The federal law known as the Community Reinvestment Act (CRA) obligates federally insured banks and depository institutions to help meet the needs of communities in which they operate.   No such law exists for money transfer agencies like Western Union.

In March 2007, Federal Reserve Chairman Ben Bernanke stated, "the CRA reaffirmed the long-standing principle that financial institutions must serve the convenience and needs...of the communities in which they are chartered." (1)

Western Union serves many of the financial needs of immigrant populations, as a bank might, with a major presence in poor and racially diverse neighborhoods.(2)  

Western Union's customers are mostly urban and poor. The typical user of its remittance services is a low-wage immigrant worker who lives in urban America, makes $15,600 annually and sends home $293 a month, almost 30% of his or her net monthly income.(3) These remitters spend up to $300 a year on costly transaction fees and disadvantageous exchange rates, which equals one week's salary for the remitter or at least sixty days' salary for their kin in cities such as San Salvador, Mexico City, and Manila.(4)

Remittances contribute about 80% to a recipient household's total income.
Almost half of Philippine households who receive remittances depend solely on this source of income. The highest monthly allocations for expenses from remittances are for food, rent, and education.(5)

We believe onerous charges in the multi-billion dollar money transfer industry place an undue economic burden on low-income immigrant families in the United States and in their communities of origin while creating an increased reputational risk for our Company.

Western Union has faced numerous lawsuits based on predatory fees and unfair exchange rates.   These suits have resulted in millions of shareholder dollars being spent on settlements.   These practices, along with our Company's relatively low degree of community reinvestment, increase the risk our Company faces in the competitive consumer market.

BE IT RESOLVED THAT: the Company develop and implement a written policy for community reinvestment.

SUPORTING STATEMENT:   In our view, community investment goes beyond charitable donations and corporate volunteering.   We believe a policy and strategy to build social capital in communities is essential.   Such a policy is best created by engaging community organizers to identify community needs to develop long-term programs that reflect those needs.

(1) The Community Reinvestment Act: Its Evolution and New Challenges, Federal Reserve Chairman Ben S. Bernanke, 3/30/07.
(2) Analysis of Alternative Financial Service Providers, Urban Institute, 2004.
 (3) Distributing Prepaid Cards through Worker Centers: A Gateway to Asset Building for Low-Income Households, The Center for Financial Services Innovation, October 2006.
(4) Transnational Institute for Grassroots Research and Action Research, April, 2007.
(5) Enhancing the Efficiency of Overseas Workers Remittance, Asian Development Bank, July 2004.


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