Money Transfer Industry Update - US Remittance Tax, Faster Payments Report, and Xendpay

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White House Considers Tax on Money Transfers Heading South

President Trump’s controversial campaign promise to make Mexico pay for his proposed border wall has been gathering steam in Washington.  Back in March, Congressman Mike Rogers (R-Ala.) introduced a bill that requires a 2 percent tax on all money transfers heading south of the US border.  Last year, immigrants to the US from Mexico remitted $27 billion to relatives and friends back home.  "This bill is simple,” said Rogers.  “Anyone who sends their money to countries that benefit from our porous borders and illegal immigration should be responsible for providing some of the funds needed to complete the wall."

Now White House Deputy Chief of Staff Rick Dearborn, an immigration hardliner, would like to include Rogers’ bill (currently stuck in committees) in a package of bills related to the financing of the wall.  The White House wants to make sure that the financing comes from what was being sent to Mexico anyway and that American taxpayers don’t have to foot the bill.  Congressman Rogers just hopes that President Trump times things right, holding off on such a divisive move until the Republicans have a win or two under their belts.

Western Union Gets New Denver Digs

The Western Union Co. (NYSE: WU) recently announced the relocation of its global headquarters from the outskirts of Denver, Colorado into the sleek Denver Tech Center, which falls within the city limits.  The money transfer giant will occupy about 250,000 square feet in this prominent, conveniently located building.  This move, which is expected to increase brand recognition, makes Western Union the second Fortune 500 company, after healthcare provider DaVita Inc., to reside in Denver.  According to a statement from Western Union, “This modern facility will enable our company to strengthen and grow, while demonstrating our long-standing support for this great city.”

Faster Payments Task Force Issues New Recommendations

 

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In part 2 of its Faster Payments Report, a task forced convened by the Federal Reserve Board (FRB) shares guidelines for ensuring that US dollars move more quickly and safely by the year 2020.  The Faster Payments Task Force consists of over 300 money transfer industry experts, government representatives, and consumer group leaders.  Part 1 of their report, which was released in January 2017, outlined the Task Force’s objectives and described the benefits of faster payments.  The new guidelines support healthy competition among payment providers, as opposed to a single money transfer method; cooperation between the public and private sectors; an evaluation of existing regulations; improvements to the FRB settlement mechanism; research on the latest domestic and cross-border payment technologies; and the rapid detection and reporting of fraud.

Xendpay Promotes Cross-Border Payments with a Conscience

Xendpay, the international money transfer service with a charitable bent, launched a "Pay Day" initiative to ease the burden on migrants sending financial support to relatives in their home countries.  During the typical payday period, which occurs around the end of the month, Xendpay users won’t incur any transfer fees or be subject to transfer limits.  Over 60 percent of Xendpay transactions are for family assistance, so the company anticipates a strong impact.  According to CEO and co-founder Paresh Davdra, “The initiative is very close to our hearts at Xendpay, as it represents an extension of our core mission to help migrant communities.”  Like RationalFX, Xendpay is owned by the Rational Group. 

 

 

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