Once a month, Viktor Murashko, a Ukrainian living and working illegally in Germany, heads to the Western Union outlet in Frankfurt's main railway station. From there, he sends about half of the $1,300 he earns monthly doing odd jobs at construction sites to his wife, Ludmila, who's raising their three teenage children in Kharkov. The process takes just minutes. By the time Murashko -- not his real name -- has telephoned his wife with the code needed to identify the transfer, the cash is waiting for her at a local Western Union agent. "It's quick, easy, and reliable," she says. "There's no messing about, and they never lose the money."

Murashko is a member of a worldwide army of some 80 million who work in one country and support dependents in another. Together they will send more than $150 billion in cross-border remittances this year, $100 billion of which goes anonymously to families in developing countries. Talk about hot money. To put the amount in perspective, that's more cash than international investors invest in those countries' bonds and equities each year. "We're talking about a flood of money from rich to poor countries," says Dilip Ratha, senior economist at the World Bank in Washington. "And it is growing dramatically."

Indeed, remittances are such a hot business that Western Union Financial Services Inc., long dominant, suddenly has a lot more rivals. Commercial banks, credit unions, even supermarkets are trying to wrest share from the Greenwood Village (Colo.) company. To safeguard its 12% share of world remittances, Western Union is fighting back with a $300 million global advertising campaign, use of a single logo to bolster brand recognition, and a move into untapped markets such as China and India. "The marketplace is very diversified, and consumers have many choices when sending money," company President Christina A. Gold said in a statement to BusinessWeek. "Western Union sees great opportunity as it relates to competition -- both in the long and short terms."

It's no secret why Western Union, which started life in 1851 as a telegraph company, is coming under pressure. Commissions on most transactions run 10% or higher, making Western Union a most reliable profit generator for its Denver parent, First Data Corp. (FDC

), which acquired it in 1995. Analysts expect the wholly owned unit, which almost collapsed a decade ago after fax machines undercut its Telex business, to make more than $1 billion in operating profits on revenues of more than $3.5 billion this year. Although Western Union controls 80% of the market in regions such as Latin America, it can no longer take its position for granted. "This is a real high-margin business," says Jeffrey J. Slowik, executive vice-president of PayQuik, a Philadelphia supplier of money-transfer technology to banks. "It's hardly surprising rivals are moving in."NO CREDENTIALS

Among Western Union's big rivals: Bank of America, Citibank, and Wells Fargo. Those three are targeting remittances worth $25 billion a year that Hispanics working -- legally or illegally -- in the U.S. send to Latin America. Each has recently bought into or established a relationship with a Mexican bank: Citi owns Banamex, Bank of America (BAC

) has a stake in Grupo Financiero Santander-Serfin, and Wells Fargo (WFC

) works with Bancomer. Immigrant workers can now transfer money easily and cheaply to relatives through those banks' ATM networks or by wire transfers.

Of course, banks have long sent money across borders through standard interbank wire transfers for corporate and individual clients. But those transactions were limited to customers with accounts and government-issued identification -- in line with strict anti-money-laundering and, now, anti-terrorist regulations. Money-transfer outfits don't require I.D. for remittances under $1,000. That left the market to specialists such as Western Union, MoneyGram Payment Systems in Lakewood, Colo., and eBay subsidiary PayPal in Mountain View, Calif. But after September 11, when Mexican consulates in the U.S. began issuing so-called matricula identity cards to undocumented workers, Wells Fargo & Co. became the first bank to accept such cards as a basis for opening accounts. Since then, more than 150 other institutions have followed suit.

In addition, as of Dec. 9, a select group of U.S. banks have been allowed to transfer funds to Mexico through the Federal Reserve's National Automated Clearing House, which means transactions will cost little more than a transfer within the U.S. Assuming the scheme works well, it will be extended to all U.S. banks, probably late next year. "This should increase competition and push down high monetary transfer fees," says Bert Ely, president of Ely & Co., a banking consultant in Alexandria, Va.

Increased competition has made remittances cheaper. In 1999, the average $300 transfer from the U.S. to Mexico cost $60 -- or 20%. Of that, about half was commission for the transfer and the remaining half was the cost of exchanging dollars for pesos at the unfavorable rate charged by the companies. Today, it costs only $10 to send the same $300. And prices are likely to fall even further.

Competitive pricing is spreading around the world. In Hong Kong, for as little as $2.50 the local money-transfer outfits will send remittances to branches in the Philippines -- the world's No. 3 country for receiving transfers. (Mexico and India top the list.) This cutthroat competition forced Western Union in November to drop its minimum fee from around $9 to $2.60. "It's a very competitive market, especially the Hong Kong-Philippines corridor," says a local money transfer specialist.FRIENDLIER IMAGE

But Western Union isn't in retreat. The company has more outlets than all its rivals combined: 169,000 branches and agents in 195 countries and territories. Earlier this year, Gold, a former Avon Products Inc. (AVP

) executive who joined the company in May, 2002, launched a splashy ad campaign with the new tagline "uniting people with possibilities" to give Western Union a friendlier image. And the company now uses just one logo globally. Gold also struck deals to open Western Union outlets in post office branches in India and China in 2001, two potentially huge markets where the money-transfer business has traditionally been dominated by courier services.

Plus, many longtime customers remain faithful to Western Union because of its vast reach. Joyce, a Filipina living in Hong Kong, uses it to send money to her children in the Philippines because "it's easier and quicker. There's no hassle." That kind of loyalty gives Western Union a buffer to fend off challengers with fewer branches and more paperwork. But with money-transfer prices dropping and competitors proliferating, the 152-year-old company is going to have to work harder than ever to stay on top. By David Fairlamb in Frankfurt, with Geri Smith in Mexico City and Frederik Balfour in Hong Kong