Transferwise vs Xoom (by Paypal)

Transferwise vs Xoom

Whether you’re a business or for personal payments/money transfers - if you make any kind of overseas payments or make multi-currency payments, then you may or may not know how much money you’re losing out on expensive transaction fees.

Over the last few years, I’ve been saving a lot more money from transaction fees and high multi-currency markups. 

I’ll show you how below:

Two of the more popular alternative payment & money transfer solutions are:

Transferwise and Xoom.

First, just a little background on both services:


Xoom is a division of Paypal. Paypal is a relatively established company since 1998 under the name Confinity.

It’s a relatively well-known and trusted payment service in the online shopping space.


Transferwise is the new-kid on the block, established since 2011.

Transferwise has been growing steadily since its inception as more and more people and businesses start to trust and see the benefits of their service offerings.

One of the biggest concerns with a newer service like Transferwise, is how secure and trustworthy is it?

Transferwise has registered legal entities in the major countries they operate in, which currently include (at the time of publishing):

  • Australia

  • Belgium & the European Economic Area

  • Canada

  • Hong Kong

  • India

  • Japan

  • Malaysia

  • New Zealand

  • Singapore

  • United Kingdom (UK)

  • Unite States

You can read more about how Transferwise is regulated here.

Use-Case Study

To try to compare these two services like apples to apples, I’m going to use this hypothetical use-case of transferring USD1,000 into Canadian dollars.


So, if you sent your money through Xoom, the receiving account would be CAD1,304.20 (using FX rates at time of publishing).


By doing the money transfer through Transferwise, the receiving account would receive: CAD1,315.35.

So, you can see here Transferwise would be the obvious choice for transferring your money, because you’d end up with CAD11.15 more.

So, why does Xoom cost more than Transferwise?

The big selling point for Transferwise’s service is that they do not mark up on the foreign exchange rate.

Whereas, with Xoom, they’re making money on the currency exchange PLUS a transaction fee.

So, next time you need to make a multi-currency money transfer, consider Transferwise so you can save yourself more money.

Disclaimer: This content may contain links to products/services where Ethan Hathaway receives a payment or commission. While this does not affect our recommendations, we always recommend readers do their own due diligence and research as to the suitability of any product/service for your own situation.

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