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Wise vs Xoom

The main difference between Wise and Xoom is that Wise’s fees are made up of a small percentage of the transfer amount while Xoom is charging a set fee and is adding a markup on the exchange rate for your transfer.

When you need to send money internationally, using a specialist money transfer service such as Wise or Xoom can save you money, time, and energy compared to using a traditional bank. The real question, though, is which one is better? In this Wise vs Xoom comparison, we’ve broken down the differences between these two major money transfer operators to help you decide which service is best suited to you.

Yasmin Purnell
Author 
Yasmin Purnell
5 minutes
May 3rd, 2024
Visit Xoom
Wise
Fees & Rates
9.4
Transfer Speed
9.0
Safety & Trust
9.2
Product Offering
8.8
Transfer Limits
9.5
Ease of Use
10.0
Customer Feedback
8.5
9.2
Overall
Xoom
Fees & Rates
7.0
Transfer Speed
9.0
Safety & Trust
8.5
Product Offering
8.0
Transfer Limits
7.5
Ease of Use
9.0
Customer Feedback
7.0
8.0
Overall

Xoom first started operating as a money transfer service in 2001 and was acquired by PayPal in 2015. The service specialises specifically in money transfers and now allows customers to send money to over 159 countries across the globe, with China, India, Pakistan, Mexico, the Philippines, and the United Kingdom all being popular currency corridors served by Xoom.

What makes Xoom an appealing option is its large disbursing network and multiple different payout options including air-time mobile top-ups and cash pickups. However, Xoom does not always offer competitive fees compared to other money transfer provides in the same field, which is something we'll look into further here.

Quick summary: Wise has better fees, but Xoom covers more countries and offers cash payments

Both of these money transfer providers are extremely well-respected and secure services for sending your money internationally. However, when it comes to fees, Wise is unmatched – the company’s transparent fee structure and commitment to providing transfers at the mid-market rate leaves Xoom’s fees and exchange rate markup looking unfavourable in every comparison.

That being said, if you are sending to a less popular destination or if the option for your recipient to receive your money in cash is a high priority for you, Xoom alone offers cash payouts and provides transfers to over 100 more destinations than Wise.

Which brand has lower fees?

Wise is extremely upfront about its commitment to transparency when it comes to the cost of international money transfers.

Where you will incur charges is through Wise’s fee structure. Their fees are determined by:

  • The amount you are sending (the larger your transaction, the higher the fee)

  • Your payment method

  • Where you are sending the money from (fees may increase if you are sending money from other countries).

The company's fees are made up of a small percentage of the transfer amount, hence higher fees for larger transfers, plus a small fixed fee which can vary depending on whether you opt for a fast or a low-cost transfer, as well as the variables above.

As an example, if you were sending £1,000 to the United States as a low-cost transfer, you would incur a fee of £4.25 - which can be broken down into a fixed fee of £0.75 plus a 0.35% variable fee of £3.49. Sending the same amount to India would have a fee of £4.77 while sending to Kenya would have a £9.58 fee.

Xoom, on the other hand, follows a fee structure similar to many other money transfer providers by charging a set fee as well as adding a markup on the exchange rate for your transfer.

The exact amount will vary depending on:

  • The transaction type

  • Your payment method and the currency you will pay with

  • The amount of the transaction

  • Which country the transaction is going to

  • Which currency you select for your recipient to receive

Using the same example, sending £1,000 GDP to the United States will incur a fee of £1.99. Sending the same amount to India would have no fee while sending to Kenya would have a fee of £2.99.

✅ Verdict: Xoom has better fees, but charges more on the exchange rate

If we were to judge Wise vs Xoom purely based on their fees, you could certainly argue that Xoom has better rates. However, it’s imperative to keep in mind that while Wise has no markups on the exchange rate - their fee is all you pay - Xoom does add a markup on the exchange rate on top of their fees.

Which brand offers better exchange rates?

One of the biggest selling points of Wise as a transfer service is that they offer international transfers at the mid-market rate, that is, the exchange rate you would see if you were to look it up on Google on any given day.

Often, you will not find a more favourable exchange rate from another provider or from your bank, who often add a markup between 4 - 5% on top of the mid-market rate.

Xoom, on the other hand, does add a margin onto the mid-market rate. There is no clear formula for these margins (at least, not that has been published), and they do vary depending on what currency you are converting your transfer to.

As a rule, however, Xoom tends to add a markup between 1 - 3% onto the mid-market rate.

✅ Verdict: Wise offers one of the fairest exchange rates you'll find

Between Wise vs Xoom, Wise excel when it comes to fees: their transparent policy to always offer transfers at the mid-market rate makes them a much more cost-effective choice compared to providers like Xoom, who have fees and more complex exchange rate markups that aren’t clear.

Which brand covers more locations?

Wise currently supports transfers to 59 countries. They also have a ‘Wishes’ page in which users can vote for a currency they would like to transfer money to if it is not currently supported.

Xoom boasts a large list of places you can send money, currently supporting transfers to 159 countries.

✅ Verdict: Xoom has a far larger disbursing network

When comparing Xoom vs Wise, Xoom covers far more currency corridors than Wise, facilitating transfers to 100 more countries. If you are looking to send money to a less well-known destination, Xoom is more likely to be able to fulfill your transfer needs.

Which provider has faster transfer times?

Wise provides the option for ‘fast’ transfers and ‘low-cost’ transfers, clearly indicating that for a fast transfer time, you’ll pay higher fees. For a fast transfer, you can expect your transfer to be received by your recipient on the same day.

For other transfers, the provider says that it should take no more than 2 business days for your transfer to be processed to the recipient’s bank account.

Xoom says that most of their money transfers are available for your recipient within minutes, while others can take up to a few days. Again, this can all vary depending on the country you are sending to, your payment method (bank account will typically be slower than a credit card), and your delivery method (cash pickups can often be available in minutes, for example).

✅ Verdict: It's close, but Xoom promises transfers within minutes

The fastest method to transfer your money will vary depending on a number of the factors listed above, but overall, Xoom does seem to offer faster transfer times than Wise.

Payment options and payouts

The payment methods accepted at Wise include credit or debit cards, online bank transfers, Apple and Google Pay, POLi, and direct bank debits (ACH).

For payouts, the most frequently used option is bank transfers. It should be noted that Wise does not accept cash or cheque payments for any currency.

The four main options you can use to pay for your transfer with Xoom are credit or debit card, bank account, or your PayPal balance.

The payout options vary depending on where you are sending your funds to, but options include cash delivery, bank deposits, or air-time top-ups.

✅ Verdict: Xoom alone offers cash payouts

Comparing Wise vs Xoom, paying for your transfer is easy and convenient with both providers, but where Xoom just has the edge is by offering cash pickups as a payout option. If paying your recipient in cash is a priority for you (over having the money deposited in their bank account, for example), only Xoom offers this service out of the two.

What do users have to say about each brand?

Wise has over 95,000 reviews on Trustpilot, and a total rating of 4.6 out of 5 (awarded an ‘Excellent’ score on the website).

Overwhelmingly, positive reviews emphasise:

  • The platform's ease of use

  • Faster transfers

  • Affordability

In terms of negative reviews, a fairly frequent concern that crops up is the lack of personable customer service. The company has a big digital presence with a useful help centre, but that focus does make it difficult to find real-time support from a customer service agent if you are facing difficulties.

Xoom has over 21,000 reviews on Trustpilot with an overall ‘Excellent’ rating of 4.5 out of 5.

Frequent comments in the positive reviews include:

  • Quick transfer times

  • Easy-to-use website

  • Ability to track the progress of transfers

Out of the more negative reviews, many users express frustration at delayed transfer times due to Xoom’s verification process, which requires a valid form of ID such as a passport or driver’s license, as well as a utility bill or proof of address or bank statement if you are sending larger amounts.

✅ Verdict: Wise has tens of thousands of positive reviews

Wise is an extremely popular money transfer service with over 8 million users worldwide and as such, it has thousands of excellent reviews to verify their accessibility, low rates, and faster transfer times. When we compare Wise vs Xoom, both providers have all-round positive reviews, but the sheer number of happy customers Wise boasts puts them a step ahead in this aspect.

What brand offers better ease of use, accessibility & security?

The Wise website and app are extremely easy to use - indeed, this is one aspect that is frequently commended on user reviews. In terms of customer support, the platform does provide assistance via live chat, email, and phone, although some users find these options difficult to access on the platform. In addition, the provider supports 12 languages on its website, including English, Spanish, German, Portuguese, Romanian, Japanese, Polish, Russian, Italian, Hungarian, French, and Turkish.

In terms of security, the company has a 2-factor authentication system that sends the user a code to verify a transaction before proceeding. Wise won’t always require additional documents from you to verify your account, but in the cases where they do (for example, if you are sending larger sums), you may be asked for a photo ID, proof of address, or a photo of you holding your ID.

Xoom has a user-friendly website and free app available on both iOS and Android for quick and convenient banking. The company receives good reviews for their excellent customer service, with options to email or call for customer service support, as well as a useful help centre to address any questions you might have. The website supports 12 languages on their website: English, German, Spanish, French, Hungarian, Italian, Dutch, Portuguese, Polish, Vietnamese, Korean, and Chinese.

As well as the provider’s verification process mentioned in the previous section, the company boasts excellent online security and privacy protection. The company uses 128-bit data security encryption to keep any information sent between your web browser and their website secure and use both SMS notifications and 2-factor authentication to keep your money secure when arranging international transfers.

✅ Verdict: It's a tie

Between Xoom vs Wise, both have excellent security and accessibility and are reputable well-known brands that you can trust to keep your money secure when transferring funds with them.

Additional features you might be interested in...

Additional features Wise offers include their Multi-currency Account, which account supports 50+ currencies and gives you your own debit Mastercard®. Essentially, having a multi-currency account means you can get paid in a currency as if you were using a local bank account to avoid unfair exchange rates. The card is specifically marketed towards travellers, expats and freelancers.

An interesting feature of Xoom that sets it apart from Wise is the payment options provided. Rather than simply sending money to another account, you can also transfer money to:

  • Reload phones

  • Pay bills - you just need the name of the utility company and your recipient’s name and account number as it appears on their bill

Case study: sending a variety of amounts

To give you a feel of what it is like to send money comparing Xoom vs Wise, let us consider the following scenarios when making a transfer from the US to Spain.

Sending $200

Wise will convert your funds at the mid-market rate, adding a set fee of $4.04 for this transfer. You can expect this kind of transfer to take up to 1 working day.

Total received: €167.46

Sending $1000

You'll receive the same mid-market rate for this transfer, but be charged a higher fee of $8.24 for this transfer, still with a predicted 1 working day transfer time.

Sending $20,000

Again, the exchange rate won't charge on a larger transfer, but the fees you can expect to pay will increase. Wise would charge a fee of $91.84 for this transfer. The transfer would take an estimated 2 - 3 days.

Sending $200

To send this amount to Spain, you should expect to pay a fee of $4.99 for a transfer via your bank account, or $6.49 using your debit or credit card. Unfortunately, Xoom's exchange rate margins are not clear, but you should expect to pay a markup between 2 - 3% on the mid-market rate.

Total received: €165.56

Sending $1000

Xoom's fees actually go down for larger transactions if you are using a bank transfer (although you may incur additional fees from your bank, and the recipient may incur fees from their bank on the other end). If you are sending money via debit or credit card, you should expect a fee of $30.49 plus the exchange rate markup Xoom adds.

Sending $20,000

Again, Xoom charges no fees for bank transfer, but that's not to say that you may incur expensive charges directly from your bank. For a debit or credit card, you would incur a fee of $601.49 plus the exchange rate markup. The transfer would take between 2 -3 days and you may need to provide additional verification for this amount.

✅ Verdict: Wise is more competitive

When it comes to Xoom vs Wise fees, Xoom really doesn't compete with the excellent fee structure and zero exchange rate markup Wise offers. Wise wins this case study by far, offering a quick transfer time and far more competitive rates so more of your money actually ends up in the pockets of your recipient.

Final Verdict - Wise vs Xoom: Who Is Better?

Our recommendation: Wise overall provides a better deal in terms of cost, transfer speeds, and usability - but Xoom covers more countries and alone offers cash payouts and mobile airtime top ups.

Wise offers extremely competitive fees, offering transfers at the mid-market rate with no markups. This, along with the excellent usability of the platform and average transfer times of 1 - 2 days makes it a great option.

Xoom, on the other hand, is still an extremely well-respected and reputable money transfer provider, but it’s fees and exchange rate margins can’t compete with Wise’s transparent fee structure. Aspects that may make Xoom a more appealing option are the large number of countries covered, as well as the option for cash payouts.

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FAQs

Can you use more than one money transfer company?
How fast is a Wise Transfer?
Are there different money transfer providers by country?
Which is cheaper for international transfers, Wise or Xoom?
Is it better to use a challenger bank or money transfer provider for international transfers?
What is better than Wise?

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Contributors

Yasmin Purnell
Yasmin is an accomplished Content Writer and Editor for MoneyTransfers.com, who specializes specializing in personal finance, student life, and business topics. Her reputation as a financial authority is acknowledged by top publications such as BBC Worklife, Cash Matters, Yahoo Finance, and CEO Blog Nation, which have featured her as a trusted source. She is also the founder of The Wallet Moth, a popular blog focusing on money and lifestyle.