Kerry and Bayh Press Western Union, MoneyGram to Eliminate Fees on Money Transfers to Haiti
WASHINGTON, D.C. - Senators John Kerry (D-Mass.), Chairman of the Foreign Relations Committee, and Evan Bayh (D-Ind.), Chairman of the Banking Subcommittee on Security and International Trade and Finance, today called on Western Union and MoneyGram to eliminate or reduce the fees for money transfers to Haiti through June 2010 after the devastation of last month's earthquake.
Current fees give 7 to 9 percent of remittances people send to loved ones in Haiti to the money transfer companies instead of going directly to the recipient or to the Haitian relief effort. Western Union and MoneyGram initially reduced or eliminated such fees in the immediate aftermath of the tragedy, but they have since been reinstated.
"While we appreciate your initial efforts, the need for a longer commitment is great because for many Haitians remittances will act as a lifeline," wrote the senators. "With your help, Haitian Americans who sacrifice to send remittances will see more of that money reach their families in Haiti who are in desperate need."
The full text of the letter is below:
February 22, 2010
Christina A. Gold
President and Chief Executive Officer
The Western Union Company
12500 East Belford Avenue
Englewood, CO 80112
Pamela H. Patsley
Chairman and Chief Executive Officer
1550 Utica Avenue South
St. Louis Park, MN 55416
Dear Ms. Gold and Ms. Patsley:
On January 12, 2010, concerned citizens across the globe watched as an earthquake of unprecedented scale and scope devastated Haiti. Following the disaster, there has been an outpouring of monetary support and material assistance from citizens, corporations and governments worldwide. Informed consumers have called on corporate citizens to modify behavior in their delivery of services, as well. For example, after an outcry from customers online, Wells Fargo agreed to waive foreign currency and other transaction fees in connection with transactions conducted in Haiti and the Dominican Republic. Wells Fargo has also waived fees on consumer wire transfers to Haiti through June 2010.
Given that Western Union and MoneyGram combined make up significantly more than half of the remittance market to Haiti, we are particularly interested in the efforts your firms are making to assist the recovery. We understand that in addition to direct donations that your corporations and employees are making, you have either reduced or eliminated the fees for the service that allows people living in the U.S. to remit money to Haiti. However, the reduction or elimination of fees was only for a short period of time; and as of February 14, 2010, both of your companies have resumed charging stated rates for transfer fees. Those fees generally range from 7%-9% of the amount transferred during periods of normal operation. While we appreciate your initial efforts, the need for a longer commitment is great because for many Haitians remittances will act as a lifeline. With your help, Haitian Americans who sacrifice to send remittances will see more of that money reach their families in Haiti who are in desperate need.
We are writing to ask that the fees you charge on remittances to Haiti be either suspended or reduced through at least June of 2010. Further, we request that you consider reassessing your margins and reducing fees on transfers in the post-earthquake Haiti. If you instead choose to restore market level fees on remitters to pre-earthquake levels, we ask that you contribute a portion of the transfer fee from post-earthquake remittances to Haiti to organizations working on redeveloping the country.
As you know, even before the earthquake, Haiti was already a country heavily dependent on remittances. When the economy was strong, the World Bank estimated that Haiti received between $1.2-1.8 billion in remittances each year (some estimates are even larger, amounting to over half of Haiti's national income). Experts anticipate that remittances to Haiti this year will significantly surge, as they have done whenever and wherever there has been a crisis or natural disaster, as loved ones abroad send money to help family members rebuild their lives. There were 535,000 Haitian immigrants living in the U.S. in 2008 and most have family or friends in Haiti needing economic assistance. Following the earthquake, the Obama Administration granted temporary protected status (TPS) for an estimated 100,000 to 200,000 of those Haitians living in the U.S. All of these factors will create a large, new market opportunity for both of your companies. We understand that neither Western Union, nor MoneyGram can prevent being indirect beneficiaries of this devastation; however, we hope you understand that maximizing the value of remittances to Haiti should, and will, be a critical component of recovery for years to come.
Following the earthquake, President Obama said that the disaster in Haiti "is one of those moments that calls out for American leadership." As leaders of the remittance market in Haiti, who stand to profit from this devastating crisis, we urge both of your companies to respond in a way that reflects the significance and magnitude of the disaster and recovery efforts moving forward.
Again, we appreciate your efforts to date and look forward to working with you to ensure that every tool we have at our disposal, public and private, is put to its greatest use during this time of crisis in Haiti.
Sincerely, John Kerry
United States Senator
United States Senator
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