Western Union CEO Hikmet Ersek explains how the Russian payment market differs from foreign
General Director of Western Union Hikmet Ersek
When Vedomosti talks with the heads of global companies about their business in Russia, the interviews often involve directors of Russian divisions. Thanks to this tandem, it is easier to delve into the details. But Western Union CEO Hikmet Ersek did not need an assistant, although the company operates in 200 countries and it is impossible to know everything about everyone. This testifies to the role of the Russian market in Western Union’s business, although the company does not disclose what share is in Russia. Ersek shared not only an assessment of the current situation and forecasts, but also a retrospective view. He remembers a lot, because he spent more than 20 years at Western Union out of the 30 that the company is present in our country.
Ersek gives an interview to Vedomosti in the last days of his work as CEO. “It’s time to pass the baton,” he says. After the New Year, Ersek will become an advisor to Western Union for six months to help his successor get up to speed without haste.
– You are leaving the post of the head of the global Western Union, why?
– I have spent a third of my life with Western Union and over 11 years as a CEO. Running this company is one of the greatest privileges and incredible experiences of my life. But the time has come to pass the baton. Devin McGranahan will take over this post at the end of 2021, he will continue to work on a strategy to accelerate the development of Western Union, and I will remain with the company as a special adviser until mid-2022. Devin is a proven executive with over 25 years of experience with financial services companies, leading companies in the global marketplace. He joined Western Union from Fiserv, a global provider of technology solutions for payments and financial services, where he served as Executive Vice President and Senior President of the Global Business Solutions Group.
– What will you do next?
– My main task is to ensure a successful induction of Devin. And now I plan to spend more time with loved ones. This is more than pleasant after more than 20 years of active work with a lot of business trips. And then – who knows what the future holds for me?
– Are you satisfied with what you have achieved in this post?
– Do you know what drives us all at Western Union? Unwavering respect and love for our clients. These people are citizens of the world. A money order isn’t just about sending money, it’s about sending your love and support.
Do you know why I decided to work for Western Union? I lived in Austria, and my father lived in Turkey, and he urgently needed money to go to the pharmacy and buy heart medicine. Then it was difficult to send money from Austria to Turkey, it took 3-5 days due to bureaucracy. But there was a Western Union company that made the transfer immediately. And I thought: if my father lives in another country, then probably millions of other people in the world have a similar connection with their relatives. And Western Union helps maintain this connection.
Reflecting on the past two decades, I can say that I am proud of everything that we, the Western Union team, have done for our clients.
Western Union’s network has grown to cover almost every country. We turned compliance into a competitive advantage, which further strengthened the company’s credibility. We founded and grew a digital business that gave more opportunities for money transfers, gave flexibility to the service. During the pandemic, we innovated by making our services accessible to everyone, providing vital connections between people around the world.
“Global companies must work together with governments”
– How did the pandemic affect the Western Union business, what processes have changed irrevocably?
– Since the WHO announced a global pandemic in March 2020, we have begun to live in new realities, in a different environment. We work in lockdown conditions, without travel. Sending and receiving money through digital channels began to grow, [потребительское] people’s behavior has changed. There will be no more point for digitalization to stop or turn back. But that doesn’t mean that cash will disappear. Especially if we are talking about Russia – such a large country with a population of about 150 million people. Regardless of where they live – in Moscow, St. Petersburg or distant regions – people want to have access to goods, financial services, payments. I see that in Russia Sberbank and some other companies, such as VTB or MTS, have done a great job in this direction.
At the same time, we need to be extremely careful and, while the social environment is changing with digitalization, we need to take care not to exclude someone from this environment, but, on the contrary, to bring as many people into it as possible. After all, 1.7 billion people in the world still do not have smartphones, which means they do not have access to digital services, that is, these 1.7 billion people do not have the opportunity [удаленно] open a bank account.
Nevertheless, digitalization is accelerating, there are now many fintech companies competing with banks, and the question is which banks will be able to adapt to these changes and which will not.
– Can we say that now the state should be, shall we say, more client-oriented?
– Absolutely. People-oriented when it comes to the state. Look at the political and economic changes in the world over the past 4-5 years. Border protection has become more visible. States increasingly protect their economies and decide [главным образом] their problems. And there is a lack of a long-term perspective in terms of inclusiveness. While issues are being resolved to protect space, the electorate [удержанию его лояльности], problems common to the whole world recede into the background. Let’s say the problem of climate change exists regardless of who runs the state. Governments need to think about people, not about the next elections, it is necessary that [между ними] there was some kind of unity in [решении общечеловеческих проблем]… It is important that the role of governments is not limited to solving problems within a particular country.
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