Western Union Business Solutions, a unit of the Western Union Company (NYSE: WU), a leader in global payment services, today announced the results of the trial of its Global Existence Transaction service, a new pension payments product that enables identity checks for overseas pensioners.
Conducted in partnership with the London Pensions Fund Authority (LPFA), the trial resulted in savings of five per cent.
Pensions administrators in the UK are required to verify the identity of pensioners that live abroad on an annual basis. Western Union Business Solutions' Existence service helps administrators meet this requirement and enables them to send payments to overseas pensioners, requiring an annual in-person pick up at a local Western Union retail location. The five per cent figure represents the value of funds saved as a percentage of the total value of pensions that were included in the initial trial, which was conducted in 2013.
In addition, it was discovered that some pensioners who participated in the pilot had recently changed address. The Existence trial allowed LPFA to update personal information, including changes of address and email updates. These updated records will help ensure future communications go directly to the correct recipient, saving time and improving efficiency for both the pensioner and the pension fund administrator.
"Ensuring overseas pension payments go to the right person is an issue pension administrators increasingly need to contend with as more retirees move abroad. The successful LPFA trial shows that significant savings can be made and the threat of fraud reduced," said Jonathan Rees, UK managing director, Western Union Business Solutions.
"Recent figures released by the Department of Work and Pensions indicate that international pension fraud cost the taxpayer around £50 million in 2012-13, which demonstrates how much could be saved by helping pension administrators confirm their overseas members' identity." [1]
"We are very pleased with the results of our initial roll out and anticipate strong demand as we move further into 2014."
Janice Watts, Director of Operations at London Pensions Fund Authority, said, "The LPFA prides itself in being a leader of public seservice pension provision. Our partnership with Western Union Business Solutions helps us ensure contributions are going to the right pensioners overseas. We are pleased that by working together we were able to achieve this result."
She added: "The Existence service was the best product available on the market that enabled us to confirm that overseas payments are being paid to the correct recipients. It also allowed us to update our pensioner records and has helped make the payments process as smooth as possible for both the overseas pensioner and the LPFA."
Western Union Global Existence Transaction launched in the United Kingdom in 2013 and will expand to additional markets this year. It leverages Western Union's global agent network of over 500,000 locations in more than 200 countries and territories.