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In a world of credit cards and checking accounts, email, direct deposit of paychecks, and online banking it may be hard to recall when Western Union delivered telegrams. In Panama, throughout Latin America and throughout the world Western Union is still alive along with MoneyGram and others. Western Union and MoneyGram are how foreign workers send money home.

November 7, 2008 MoneyGram International hosted its online third quarter earnings report. Besides talking about a 14% growth in money transactions year over year MoneyGram talks about a drop off in business in and out of Mexico. MoneyGram is also opening shops in the Czech Republic and expanding business in Poland.

Closer to home a visit to Western Union or MoneyGram offices at Plaza Concordia on Via España in Panama City reveals a room full of people sending and receiving cash. Many of these folks are Colombians sending money home. Colombia has been embroiled in a civil war for about forty years. Jobs are scarce in many of Colombia’s major cities so young men and women come to Panama to look for work. Most are sending money home with every pay check. Because much or Panama’s lower paid labor force is paid in cash that is what is carried into the Western Union office and what arrives as Colombian pesos in Bogotá, Cartagena, Manizales, or Medellin.

The drop off in Mexican business corresponds to press reports of Mexican workers in the United States returning home as the recession spreads and jobs are lost. In the USA a 1,200,000 loss of jobs is reported in the last year. That number probably does not include “off the books” labor performed by underpaid foreign workers.

Currently there does not seem to be an exodus of Colombians heading out of Panama which corresponds to the fact that Panama with its conservative banking and continuing investment opportunities seems to be weathering the current economic storm pretty well.

Emergency Cash

Even if you live in the world of credit cards and on line bank transfers you can still lose you billfold or purse with you cash and credit cards in Panama. In that case a trip to a CVC pharmacy or WalMart puts your friend or family at a MoneyGram location. A trip to Cub Foods lets them send to Western Union. If you friend or family is signed up with Western Union they can bill a credit card and still send you cash. They can send it “same day.” You go to Plaza Concordia or whatever location and give them you identification or if that was lost a code number that the sender needs to send to you. There are, by the way, several thousand internet locations in Panama City so, with 50 cents, you can email or Skype in case you cannot call.

Here is a word on the cost of sending money out of Panama. Sending $50 to Colombia, next day, costs about $4.50. Sending the same amount to the USA runs about $14.

Money transfer companies like Western Union and MoneyGram operate world wide. They engage in bill paying services in many countries including the USA. However, in Panama, the rest of Latin America and throughout much of the developing work these companies furnish a lifeline to the family back home waiting to pay the light bill or buy groceries for the kids.