Story URL: http://news.medill.northwestern.edu/chicago/news.aspx?id=62585
Story Retrieval Date: 6/20/2013 3:25:09 AM CST
Every other month, 37-year-old Guadalupe Lopez sends about $50 to her mother in Mexico.
Lopez, a Mexican immigrant who makes $120 a week working part-time at Wolcott Laundry in Pilsen, says sending the money can be an expense in itself.
To lessen the costs, Lopez uses Order Express, a money-wiring service in Pilsen that charges her a $5 fee to send up to $1,000. For Lopez, Order Express is a much cheaper and faster option than larger companies like Western Union.
"They ask for more money,” she said. ‘It’s too much.”
Like Lopez, many immigrants rely on money-wiring services to quickly send money to relatives.
Western Union, the industry’s largest company, has faced an ongoing, nationwide boycott by 158 immigrant organizations who say the company should change the industry standard of charging high money transfer fees to lower-income, immigrant customers.
“Western Union charges the highest fees and gives the lowest exchange rates in the industry,” said Francis Calpotura, director of the Transnational Institute for Grassroots Research and Action, the organization that launched the boycott on Sept. 10.
“Western Union could reduce its fees by a third and still be competitive.”
Though Western Union’s rate of $10-$15 per transaction is comparable to industry competitors like MoneyGram, Calpotura said that the boycott directly targeted Western Union because the $1.1 billion company has generated the largest revenues and has not reinvested enough of these profits into immigrant communities in the United States or the countries receiving remittances.
Dan Diaz, a spokesman for Western Union, said the company has started several charitable initiatives, such as the “4 + 1" Program, which began in 2005 to fund projects that create jobs in Mexico.
On Sept. 13, the company also launched the “Our World, Our Family" Program, a $50-million, five-year initiative to provide migrant families with more educational and economic opportunities.
But in Pilsen, a predominantly Mexican community on the West Side, many residents had decided to exercise other options long before the boycotts began.
At America Transfers, a Mexican-owned money-wiring service on West 18th Street, customers can pay a $5, $10 or $15 fee to send up to $1,000 to countries in Latin America. The fees vary because the higher the fee a customer pays, the more the recipient will receive in their country’s currency.
Though there is a Western Union location about five minutes away, Mayra Flores, an agent at America Transfers, says her company sends about 80 money transfers a day that average around $300, with most people sending money to Mexico.
Valentine Rocha of Berwyn, who pays a $10 fee every week to send money to his wife and children in Mexico, said he stopped using Western Union’s services a long time ago.
“It’s more expensive over there and you don’t get the same,” Rocha said, comparing Western Union's services to the varying fees and exchange rates America Transfers offers.
In addition to varying fees, America Transfers also gives customers every 11th transaction free. Flores, who is Mexican, said that the company attracts so many customers because its rates are more reasonable than the larger transfer services.
“Honestly, since I’m a Mexican, I know how hard they work to send that money,” she said. “I don’t think they should charge that much.”
But Diaz, the Western Union spokesman, said the company offers discounts through its customer rewards program and that the company has not seen a reduction in customers in the midst of numerous choices in the marketplace and an ongoing boycott.
“We have not seen any lack of interest in terms of services on behalf of our customers,” Diaz said. “We are continuing to serve our customers in the best possible way.”