Good day, and welcome to the Western Union Third Quarter 2021 Results Conference Call. All participants will be in listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded. I would now like to turn the conference over to Brad Windbigler, Head of Treasury and Investor Relations. Please go ahead.

Thank you. On today's call, we will discuss the Company's third quarter 2021 results, our Financial Outlook for 2021, and then we will take your questions. The slides that accompany this call and webcast to be found at westernunion.com under the Investor Relations tab, and will remain available after the call. Additional operational statistics have been provided in supplemental tables with our press release. Our call today is our CEO, Hikmet Ersek, and our CFO, Raj Agarwal. Today's call is being recorded and our comments include forward-looking statements. Please refer to the cautionary language in the earnings release and The Western Union filings with the Securities and Exchange Commissions, including the 2020, form 10-K. For additional information concerning factors that could cause actual results to differ materially from the forward-looking statements. During the call, we will discuss some items that do not conform to generally accepted accounting principles. We have reconciled those items to the most comparable GAAP measures on our website, westernunion.com, under the Investor Relations section. We will also discuss certain adjusted metrics. The expenses of that have been excluded from adjusted metrics are specific to certain initiatives. But maybe similar to the types of extensive the Company has previously incurred and can reasonably expect to incur in the future. All statements made by The Western Union officers on this call are the property of The Western Union Company and subject to copyright protection. Other that the replay noted in our press release, Western Union has not authorized and disclaims responsibility for any recording, replay, or distribution of any transcription of this call. I will now turn the call over to our CEO, Hikmet Ersek.

Thank you, Brad. And good afternoon, everyone. We appreciate you're joining us today to discuss our third quarter results and the progress of our business. Our business continues to revamp from the effects of the COVID-19 pandemic, delivering double-digit revenue growth in digital and business solutions as well as strong profitability and operating cash flow during the quarter. Additionally, we are continuing to make good progress on our key initiatives, including our pricing evolution and platform enhancements. Now, let's take a closer look at the third quarter results. Overall, we achieved revenue growth in the quarter of 2% on a reported and constant currency basis, which was driven by 15% growth in digital and 31% growth in business Solutions. While these two businesses grew nicely, the retail business was affected by the slower Economic recovery. In particular, recovery in the labor markets, where employment of migrant workers remains below 2019 levels. As a result, our CTC revenue was flat on a reported basis, or down 1% in constant currency terms with transaction growth down 1%. Both principal per transaction and cross-border principal increased approximately 4% during the quarter. Year-to-date, our cross-border principal increased 19%, reflecting the elevated levels of support that our customers provide to their loved ones during the period of uneven Economic recovery. With that, based on the latest World Bank forecasts, we believe we are growing market share. Our digital business continues to generate strong growth. Revenue generated during the quarter was $266 million, maintaining the record high level that we achieved in the second quarter, and putting us well on pace to exceed $1 billion in revenue this year. Most of our digital business is westernunion.com, which grew at a healthy pace in the third quarter with 16% principle growth and 12% revenue growth.WU.com average monthly…

Thank you, Hikmet. And good afternoon, everyone. Today, I will discuss third quarter results and our full-year 2021 financial outlook. Third quarter revenue of $1.3 billion increased 2% on a reported and constant currency basis. Currency translation net of the impact from hedges benefited third quarter revenues by approximately $3 million compared to the prior year. In the C2C segment, revenue was flat on a reported basis, or decreased 1% constant currency. BS transactions declined 1% for the quarter as the slow recovery from COVID-19 impacted retail money transfer, partially offset by 19% transaction growth in digital money transfer. The spread between C2C transaction and revenue growth was 1 percentage point on a reported basis and flat on a constant currency basis. Total C2C cross-border principal increased 4% on a reported basis, or 3% constant currency driven by growth in digital money transfer. Total C2C Principal per Transaction or PPT continued to grow and was up 4% or 3% constant currency driven by mix and changes in consumer behavior. Digital money transfer revenues which include wu.com and digital partnerships increased 15% on a reported basis, or 14% constant currency.wu.com revenue grew 12% or 11% constant currency on transaction growth of 9%. Wu.com cross-border revenue was up 16% in the quarter. Regionally, WU.com revenue growth was led by North America and Europe and CIS. Digital partnerships continued to show solid growth across revenue, transactions and principal on the quarter. Moving to the regional results, North America revenue decreased 2% on both a reported and constant-currency basis on transaction declines of 5%. Constant currency revenue was impacted by U.S. outbound, including U.S. regulations concerning Cuba, that limit our ability to provide services there, and then continued declines in U.S. domestic money transfer. Revenue in the Europe and CIS region declined 3% on…

We will now begin the question-and-answer session. . At this time, we will pause momentarily to assemble our roster. The first question comes from Tien-Tsin Huang with JPMorgan. Please go ahead.

Okay, thank you. very good to connect with you all. I want to take it off asking on the retail impact that you talked about with labor and with our Migration. How broad-based was that, any call outs from a regional perspective? And is it more COVID related or -- it sounds like it’s some national with Cuba, do you think from a competitive standpoint as well?

Yeah, let me start on the -- obviously, micro environment has not been as supportive as we thought, right. We hope that after vaccination became widely available, that in the U.S. and Europe the economy will be much better, in much better position. That impacted especially our retail business; our migrant customers have not been employed as we thought. And in fact, the labor market has normalized -- not normalized in the U.S. as we hoped, and the one example I can give you is that U.S. foreign-born employment still sits at 1.2 million people. So the U.S. foreign born employment is 1.2 million people, which is -- it is like today, it was 2019. So this environment has been impacting our retail business. However, on the other side, we have seen very good performance on our digital business. Our digital business has been performing very well. And that drives, definitely, our C2C growth. And within the digital business, the business has been extremely good performing to people use their accounts and money and using our platform. So that has been a good factor on that. And then regional, I would say that U.S. definitely has an -- Europe, has an impact on our retail business. But digital-wise, all over a good growth. And that's going to continue, and I'm very optimistic. And as I said in my opening remarks, we are hitting the billion dollars, and I don't see any competitor who has a billion dollar revenue to report and growing that strong with a very great base, growing that strong. So that's very good. You want to add something?

Yeah. Tien-Tsin Huang, the macro factors relate primarily to impacts to our retail consumer as you noted. And North America is related a lot to U.S. to Cuba because we shut that down late last year. So that's getting to be annualized soon. And then U.S. TMT continues to decline. Latin America was probably the one brighter spot that continue to recover a little bit from last year because Latin America has less relative digital

Business growth and so last year was hit harder and this year it's recovering more because of that factor. And then there are a lot of other nuances throughout the rest of the world, but it is generally impacting our retail consumer. More than anything else.

Thanks for sharing all that. Maybe just my follow-up digital banking trials here. What are you looking to learn from the pilots in these two countries in the second quarter and then what you see, how quickly can you expand on this in the two countries and even in some other countries as well?

Great question. As you know, our digital banking is based on our -- expanding our ecosystem. We have one big unit. It's called westernunion.com. We take wires -- millions of customers globally on direct relationships. We are building on that digital banking and we use our existing assets, our brand, our global platform, but also our internet bank -- International Bank license, which allows us to do banking service to our customers and our customers told us. And we are launching services in Germany, Romania. And with that also we are launched, as I mentioned earlier, we're launched on this morning. You saw at, probably, press release. WU Shop. WU Shop is allows customers to shop online in Germany and Austria and send gifts, also send money and also gifts to their loved ones cross-border. It's really unique and the customers were asking us and in the future, maybe also buying us airline ticket and really shopping online with our -- for our customers. And we want to launch that in the U.S. very soon within this quarter and we are also expanding definitely digital banking activities globally. And we have these capabilities that not many companies have the unique customer, which is the migraine customer, are asking for additional services. I'm very excited about that and I will give you a more -- once the products are launched I'll give you more figures and more data of success will that is but I'm very excited about that.

Okay. Thanks. Excited to learn more about it. Still appreciate it.

The next question comes from Jason Kupferberg of Bank of America. Please go ahead.

Thanks, guys. Just wanted to start by building on tangents question. Just regarding the migrant worker employment dynamic. I mean, when you think that starts to turn around. What do you think it takes for that to turn around? And why do you think it's not affecting your digital business. Just the retail.

As you know that digital business customer and migrant retail customers is different segment. And we could also say that in -- over years, I was repeating that digital customers are new incremental to our brand, and it's not cannibalizing our retail business. We told that a digital customer by nature has -- has a bank account or credit card to send money globally. On the receive side, the most of the transactions are picked up in retail by cash. But one of the faster growing parts is that comp payout. This is great, that shows our capabilities as omnichannel and omnichannel environment. The impact, Jason, to your question, why retail, most of the customers have been impacted, or probably the cash customers. They want to go and do cash transactions. Some facts obviously, the global GDP, as you know, was broke down from 7% in the last few months ago to around 5%. In the U.S. even, from 7% to 2% growth. So these are definitely impacting our customer’s behavior, and Western Union has been always a first indicator of economic environment. And that's probably our customers feel the first and that's -- has a big impact on retail customers. And digital customers have more a solid income, have money on their account, and they are continuing to support the customers. Now, seeing that, as you know, this quarter, it was down, the retail, but that doesn't mean that it will be down. It's a very solid business, very resilient business. The customers are doing everything, still, to support their loved one. I'm very optimistic. We are expanding our retail business. We, today, announced that we crossed approximately 600,000 locations. We are expanding and gaining more and more agents.

Okay. So if we're trying to hone in on the potential performance of the digital business in Q4, I'm just looking at last year. I think it was up around 4% quarter-over-quarter. I would assume there are probably some seasonal tailwinds around the holidays. Is that a decent proxy for how Q4 digital growth could come in this year?

Jason, I just -- say that again. You're comparing it to last year's Q4?

I'm saying Q4'20 versus Q3 '20 was up around 4%. So if we take that.

Yes. It's hard to compare growth rates and sequential impacts from last year because there was so much happening last year. We -- and when you look at the overall growth this quarter with the mid-teens growth for total digital, and then low double-digits for WU.com. That's not necessarily what the business will do in the future. I think it just depends on all of the marketing activities. The platform upgrades that we're doing, the features and functionality, and then the distribution that we have around the world, that we have a lot in the pipeline. So, all of those are going to have an impact on where the business ultimately goes. Q3 to Q2 was relatively flat from an overall revenue standpoint. And in our outlook, we have not assumed something too significant for this year. But in terms of longer-term, we continue to see good opportunities for growth for the digital business.

Okay. Just last one real quick. The housekeeping thing, just you bumped up the midpoint of EPS guidance a little bit, even though you lowered revenue and maintain margins and tax, is that just a function of buybacks and your share count?

No. We have ranges for each of these line items only come into the year, and they don't always all moves in unison. So we have a number of factors that can impact revenue or expenses or level of investments. We're obviously saving some money this year with the expense management. So that's helping us achieve the overall margin goals and bottom-line and EPS levels. Even while revenues not being hit -- have the original objectives. And as we typically move through the course of the year, Jason, we will tighten those ranges based on what we're seeing. So it's nothing really more than that.

And we feel comfortable with our investments. We continue to invest heavily in technology and innovation. We are really expanding on that. So we will comfortable and Raj not talked about that we feel really comfortable with our guidance on the EPS and on the margin guidance.

Okay. Thanks, folks.

Also obviously on the expanded revenue guidance, not the new revenue guidance. Thanks, Jason.

Thank you.

Operator, can we have another question?

Yes. The next question comes from Darrin Peller with Wolfe Research. Please go ahead.

Thanks, guys.

Hey, Darrin.

While there's been a lot of progress made on the -- hey, Raj, on the WU.com business, obviously, and as you mentioned, it's now become the largest digital money transfer business. When you consider the sequential change, just to follow up on that a bit. Again, it was pretty flat from a revenue standpoint from last quarter to this quarter. And I think you have average users who set up 8%. So can you help us understand what kind of dynamic we can expect over user growth for WU.com going forward? It was obviously much higher. It's off a larger base now. But we haven't heard an update to that 9 million metric in a while. And I'm just curious what you think you can do. What kind of growth normalized into ‘22? And what tactics you are going to be taking from a marketing standpoint to execute on that kind of user growth going forward.

I mean, a lot have happened during -- over the last couple of years. At the end of -- if I give you a little bit of history. I'm sure you recall at the end of 2019 we had anticipated that the Digital business, which is primarily WU.com back then, could grow at the 20% range for the following 2 to 3 years or so. And I think that's what we said at our Investor Day last fall and last year it doubled the growth. So it was almost 40% revenue growth, this year it's probably going to be in line with what we would have expected in a normal year. And now, we're going to be sitting at over a billion dollars in size and on a much larger customer base too. We do believe that there will continue to be good growth in those various metrics. But a lot of it will depend on the level of traction we get on the digital partnerships side. So that's going to be a key component. And then WU.com, the opportunity is really there. The market growth will come from the digital part of the remittance market, and we continue to have a very strong position there. And we'll continue to invest in marketing for customer acquisition. And we're also spending a fair amount on the technology side to continue to upgrade the features and functionality, which ultimately increases the retention levels of the customers we have. So we feel good about the business and the continued customer growth and traction of the digital business.

Yeah just on that note. I really -- I'm very happy with the digital pieces actually. While the economic conditions and industry trends has been impacted, not only us, over all industries. And you heard from other calls also, I think our digital business has been performing pretty well, and it's extremely resilient and it's growing. That's the former base. Think about that, westernunion.com is in 75 countries, but only in 75 countries and maybe 50 of them are pretty new launch, pretty new, and really getting new customer segments. So, there is a really huge wait to go forward with the westernunion.com connecting the 200 countries. So there is the customer acquisition here. Also with our new ecosystem strategy, making customers more sticky lifetime customers. That's what we think that and also the other one is that our investment on STC Bank, which is basically westernunion.com strategy in Saudi Arabia. They do their digital banking and we are part of it. These things will continue and we are optimistic, but to your question, what happened in Q3, a little bit slow down, has been also impacted by economic --

Where it's really grow over from last year. So high and Darrin, for the full year, that monthly active average users, the annualized number will be similar to where the revenue growth will be for WU.com. So the quarterly growth was only 8%, but -- and that just reflects the much higher base of customers that we had in last year's third quarter. But the overall customer level is much higher than it has been, obviously.

And then -- that's helpful. And then engagement levels on these users are obviously notably higher than retail. I'm not sure if you've ever disclose, it will be great to hear. If you can give us a sense of the number of transactions you that you would see on WU.com users versus more traditional. And then really adding onto that what that can turn into with this WU Shop initiative and the WU Plus initiative and what timing you expect around WU Shop had just curious to hear a little more around your strategy on that initiative.

I think first of all, we don't give this numbers yet, but that's a good hint. That long-term, we should maybe disclose more of that, especially when we talk about our ecosystem, of that can be the customer loyalty, how long we keep the customers, how many transactions they do more than -- different than the retail transactions. By nature at westernunion.com, you have to be a lifetime customer -- long-time customer because you have to have an account. At the retail customers, you walk obviously to a retail location, make a transaction. And WU.com customers, by -- digital customers by nature are longer customers. And we should maybe institute or disclose that. Regarding strategy, what we do with the ecosystem is definitely something that we will more give a highlight in future earnings releases. And I'm excited as we discussed that first time in our Investors Day in the end of 2019. We are really executing what we said there. And that's an exciting opportunity for Western Union besides putting on the money transfer; also really satisfying the needs of the migrant customers long-term and their loved ones in back home.

Was there a follow-up, Mr. Peller?

It was really about WU Shop and the opportunity there in terms of investment. What you'd expect to be in about, let's call it a year from now, around that initiative?

Yeah.

We'll have -- we're just launching it now, WU Shop, and we're doing the financial services test this quarter as well. So Darrin, we're -- hopefully we will have more feedback after the first quarter or so of next year. We just need to see the level of traction, but it really is a seamless way to shop online.

I think there is a link on the presentation where you can go to WU Shop and look at that. But it's really shopping and sending from home, and sending your gift cross-border. And there are about 12,000 retail shops there, which you can send not only money, but also send goods there and get cashback, which is a quite attractive way of keeping customers longer and building this ecosystem for a longer time like a bank, digital banking.

Okay. Got it. Thanks guys.

Thanks, Darrin, until later. Operator, can we have the next question please? Operator? There is no Operator on?

Just bear with us one moment. I don't know what's going on with this call; we're not really

Bear with us. I think there are some technical issues with the Operator we are trying to reach him to get the next question.

Pardon me, everyone. This is the Operator I will take it over to question-and-answer session at this time. I do apologize. And our next question today comes from David Togut with Evercore ISI. Please go ahead.

Thank you. Good afternoon.

Hey, David.

Hey, Raj. How are you?

Good.

Could you walk through the price mix within C2C, both in North America and EU and CIS? For example, it looks like you have negative price mix in EU and CIS with transactions up 3%, GAAP revenue down 3%. But then in North America, it looks like you had some positive price mix with transactions down 5% and revenue down 2%. Is that just the mix of wu.com or is there actual some change in pricing incurring in either region?

Yeah. There are different things happening in different regions. In Europe, in CIS, as well as Middle East Africa, and South Asia, the digital white-label business is causing most of the transaction and revenue spread. So, in those two regions, that's the main factor. In North America, it is just from price optimization that we're doing and primarily in our U.S. domestic money transfer business. And then Latin America has some positive business mix in it, where the business continues to recover, but we're getting a lot of good high principal growth within the Latin America region. And so that's causing the bigger spread between transactions and revenue. And then APAC just continues to recover from some of the COVID -related impacts from last year. And I would just say, overall, when you look at our business on a global macro basis, the pricing environment continues to be quite stable. We have 20,000 corridors, David, as you may know and -- for our country pairs, and we're always moving pricing up and down in those corridors that when you add it all up at a macro level, we don't seem to see too much in the way of pricing pressure. And then we're also moving pricing within our channels. And so hopefully that gives you a little bit of color on what's happening around the world.

That's helpful. Thanks. Could you just expand upon your comments around price optimization in U.S. domestic?

Well, yeah.

price cut you took?

Well, it's not necessarily a price cut with the U.S. domestic money transfer business has been in decline for several years. It's now about 4% of total revenues and we don't expect that's going to turn around as you've heard us say before. That's not a business where we're going to be competitive long-term. The US. Domestic business. And so we are trying to maximize the cash flow opportunity there. The one caveat I would give to it is that we have just launched the relationship with Walmart and we're seeing some good traction there in our domestic business. So we'll just see how that plays out. But more broadly throughout the rest of the U.S., that's really what I was getting at.

The next question comes from Brian Keane of Deutsche Bank. Please go ahead.

Hi, guys. I just had a couple of questions or clarifications. Raj, the Digital revenues, was that in line with expectations in the quarter or was that also impacted by COVID, because I guess the growth rate of 15% is below the 20% outlook. Is there are some moving pieces there.

Yes, I would say is generally what we expected, Brian. So not really impacted by COVID. Maybe on the margin, but we're still very much on track to exceed $1 billion of total digital revenue for the year. And we achieved the same level of revenue that we had, which is a record high. In the second quarter, we're in a $266 million of revenue. So it's very much in line with what we had expected and keeps us on track to exceed $1 billion of revenue this year.

And is 20% the right growth rate to think about going forward in the digital business?

Yes, it's hard to tell you what to expect for next year or in future years, because we didn't expect to be at this level of revenue this year. And -- or we're going to be comfortably above $1 billion for this year. So we'll just have to see where we exist. But again, there are a lot of factors. So, if we think about WU.com, the things that we can drive include improving the features and functionality on our platforms to drive better retention levels of our customers. We're also continuing to invest in marketing, which is the main customer acquisition vehicle we have. And that's been going quite well. And then lastly, we have a very heavy focus on distribution. So more account funding, more account payout, more mobile capabilities. So those things will help to drive the WU.com business. And then for our digital white-label business, it's all about signing more digital partners around the world. And we'll have more that will go live in the next few months that we haven't announced yet, but we have signed. And so, all of those will come into play on total digital, but with the billion-dollar base we have given us a good platform for future growth.

I think, Brian, also -- maybe your question is also, how you are doing against the competition, all these things. I will say that we are doing pretty well. If you look -- generally the market has been -- obviously, industry has been impacted by Q3 -- by the economic environment, but our Digital business has been performing very well, and competing with the competition also very well. Just to give you some general principle amount, the World Bank tells that we're going -- the wealth remittance market will grow about 2%, and we believe we're gaining market share because our principal is going by 19%. So within that, obviously mainly driven by Digital business. So I would say that our Digital business is performing very well. As Raj said, is a 20%, 15% or 25%. I can't tell you now because we had an excellent year on digital business and we are having an excellent year in digital business. And we're going to reset. What -- where do we go from $1 billion? Is it going to be $2 billion soon or $3 billion soon? Let's see. That's another guidance we will give at -- in the February.

The next question comes from James Fawcett with Morgan Stanley. Please go ahead.

Thank you very much. I appreciate all the details you've given on business dynamics. I want to turn really quickly to the Business Solutions sale. And as that progresses and as long as it clean or finishes the way you expect, I'm wondering if you can talk about the priorities around your use of proceeds there, particularly capital allocations. I know it's early, but just thinking about how you plan to align business priorities with that contribution.

Yeah, I think first of all, as I mentioned earlier, we are happy with our strategic approaches and within that also with Business Solutions Divestiture. We assume that we're going to have the first closing by end of first quarter and the proceeds, all the proceeds will be transferred by when we close the first one. There's a second part also, but that doesn't impact the proceeds. So the second part we will be probably later given the regulatory environment in Europe. So the Business Solution has been performing very well this quarter. One of the reason is that first of all, the grow over. Secondly is that the university is opened again. The people can go back to the universities, can study across border after COVID, and so the tuition payment has been good for us. And that has been probably one of the biggest impact on the Business Solutions growth. So, maybe on the capital allocation question for James, Raj, do you want to take that?

I can. Yes, sure. James, we'll have, obviously, more specific color once we close that transaction which as Hikmet said, will be sometime in the first quarter. But whether it's our ongoing Cash Flow, operating Cash Flow, or proceeds from the transactions which are expected to be about $800 million net Taxes. We still have not changed our capital priorities. So that is to invest in the business, to drive organic growth and expansion. Secondly, we pay a very healthy dividend. This year it will be almost $400 million by the time we're done with this year. And then third, we would like to focus on the right client of acquisition opportunity and it doesn't necessarily have to be a direct revenue generating acquisition. It could be a technology or capability of some sort or something that might help our ecosystem strategy. And then to the extent that we have excess cash left over will buy back stock. And that priority order hasn't really changed, and that's the way we think about whether it's the proceeds from the WU sale or our ongoing operating Cash Flow. That's how we think about it.

Thank you. I appreciate that. And then wanted to ask quickly because I haven't heard it mentioned, but I know that we're continuing to or expected to continue to make progress on some of your trials around broader suite of financial services in Europe. Just can we get an update on what's happening there and the timeline that we should start to monitor things more closely, etc.

Sure. I'm very pleased that in such a short term we're probably -- as you know, digital banks need 6 years to 8 -- 10 years to launch a product. We've been launching products very -- in a very short part because one of the biggest advantages we have -- we have our platform, then we have our brands, and we have a bank in Europe with the bank license, which we have to report the regulators, everything. As you know, finance -- launching products with financial service is not easy. So we are launching this year prepaid card, multi-currency card. Really, talking to the customers with their needs and really having a consumer financial service products for our customers. And that's -- our bank allows that. And really building an account relationship, not that transaction relationship, but account relationship with our customers for their financial needs. And that's for the big advantage that we have compared with other traditional money transfer companies. Really, Western Union is moving to a more multiproduct, multiservice Company with close relationships. And to do so, we have all the fundamentals, and I'm very excited and we're going to obviously give more information to you once we launch the first product and their results.

The next question comes from Ashwin Shirvaikar of Citi. Please go ahead.

Hi, Ashwin.

Hi. How are you?

Good. How are you?

So first question. The solutions that will benefit from education. How much of it was from reopening the very that actually students coming into universities this year

Sorry, Ashwin, do you mind just maybe getting closer to the microphone? You're a little bit jumbled there. I can't hear you clearly.

Yeah. Is this better?

Yes.

Okay. Cool. Another question is with regards to Business Solutions revenue growth, how much of the growth rate this year or this quarter was because of reopening versus any kind of share gain?

Well, I guess the way I would answer it is that it's slightly above where it was in 2019 from an absolute revenue standpoint. And then it's sequentially better obviously, as well. So I guess if there's some additional revenue there, but I think the primary driver is really about the seasonality around the education or tuition payments. And so, sequentially, is a little bit better and then a little bit higher than 2019 levels, and correct me if I'm wrong in that, but that's right.

Yeah, that's right. Yeah.

And then I think -- so it's a little bit of both, but I would say it's mostly related to the grow-over impact in the seasonality of the education business.

Understood. And then as far as the digital bank strategy is concerned, should we be looking for almost a country by country approach, like you mentioned, STC Pay, or is it a broader, more global tanker bit of components that catalog better?

So it's definitely -- we're starting at Germany and Romania. You'll see an announcement soon for few countries, additional countries. And obviously, we're testing with the 2 big countries, which are Germany on the send country, migrants, and Romania more on the receive side to understanding the needs, to adapting the products. And it's definitely a global approach. It's not a one part. We as a global Company look always for global opportunities, and we really want to launch that globally. But obviously, first move will be in Europe, and we're going to expand in Europe to other countries and taking to -- obviously to U.S. and other countries soon.

The next question comes from Jenny Friedman with Susquehanna. Please go ahead.

In your prepared remarks, you had mentioned that you're integrating the network for future use in digital currencies. That sounded important so I was wondering if you could elaborate on that.

Yes. Sure. Obviously, our platform is allowing us to have 80 currencies, right? And that's unique. We are in 200 countries. We can take any currency to translate to any currency and settling that, make the compliance programs, Know Your Customer, and payouts. And probably the -- one of the biggest advantages is that we can also transfer the digital currency to fiat currencies under than 30 currencies. So the biggest question on the digital currency is such a big word, it's a cryptocurrency or central bank; it should or Bitcoin. It's the volatility of sometimes -- of the coin and the use cases for consumers. And we are looking at that. We are really involved on several discussions. And good for us. Digital currency, once it's regulated, once it's really as a use case, it's like taking our mother currency and settling with another currency. So we feel very comfortable that our platform can do that. Once we feel comfortable than our used cases, we will definitely start. And many dealer currency companies also approaching us because they know our capabilities. They understand that we are closer to consumers. We can do both fiat currency and digital currency. That's something very exciting.

If you -- Jamie, if you just think about the primary use case in our business, if our customers are sending $200 or $300 at a time, their primary goal is get the money to their recipient as fast as possible, get it there efficiently, get it there with the least amount of time and with transparency. And that's the service we already provide today, right? But if there were certainly another use case or if there was a need to do additional conversions or additional steps, I don't think most of our customers are thinking of that cryptocurrency or digital currency in that way. We have the ability to settle 130 currencies today with consumers. If we have a desire by consumers to do more, we can certainly add to it. But that's not really what they're thinking about. And if you move money from an account to an account in our business, let's say it's about a 1% yield, that's a $2 or $3 transaction. So it's very efficient, it's very fast, it gets money to the recipient. And that's the end of job for what most consumers are looking for and we'll see what other applications there are but that was the main point of the comment.

No, that sounds exciting. Thanks for that color. I'm going to drop back in the queue but thank you for that answer.

And Operator, we have time for one more question.

Thank you. And that will come from Vasu Govil with KBW. Please go ahead.

Hi. Thank you for squeezing me in here. I just had a quick -- 2 quick ones. 1. I guess first on just October trends. I know you guys said you're kind of assuming the same TQ type of trends continuing into the fourth quarter in your guide. But anything on particularly October, what you've seen. Have you seen any improvement, or your trends have been pretty much the same.

Yeah. We won't comment on October trends, but we're comfortable with the outlook that we're giving today, and I expect that that's the way it's going to turn out. That's why we gave the outlook that we gave today.

Got it. And I guess just the next quick one I had was on Walmart. I know you called that out earlier, Raj. Any color on how that channel is performing relative to expectations. And I don't know if you can provide any quantification as to how much of a tailwind that might have been in the quarter.

Well, let me start over Walmart, you can finish it quickly too. Well, we are very happy with Walmart. We enrolled 4,700 locations in the U.S. As we recall, we already were active with Walmart in Canada and in Mexico, and the performance is picking up. And good performance and we start our marketing activities. If you have time to go to a Walmart location, you will see Western Union everywhere there. And I think a frontline associate has been trained and many customers start to use us to many corridors. And we are gaining customers from Walmart to our networks, so that's great.

The businesses continue to gain traction every month that we've launched it. And we think it's going to be a bigger contributor next year and we're doing a lot of promotional and other marketing type of activities to create the awareness. And so we're pleased with it.

Thank you. I think we have the last call -- last question Raj, for this call. Thank you for joining this call. I am looking forward to -- we're looking forward to the next call in February and we are pleased with our resilience of the business and we are very proud of Western Union. Thank you for calling and dialing in. Have a good day.

Thank you, everyone.

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