Xoom Money Transfers India: Your full guide

Wise
28.06.19
6 minute read

Sending money across borders is often filled with risks. You might have also come across many international money transfer agencies that lure you with ‘free transfers’, yet they charge a hidden fee, without your knowledge. So what you really need is a money transfer service that is fair, fast and reliable, all at the same time.

Xoom is a well known international money transfer service, which has been especially popular in India for receiving money from the US, UK, Canada, and GB.

And though it can send money only from these countries, it has a constantly growing list of recipient locations, globally¹.

Founded in 2001 and acquired by Paypal in 2015, Xoom has gained more repute from Paypal’s extensive experience in the money transfer business². But are you aware that Xoom charges a hidden fee, in the garb of no transfer fee? On the other hand, Wise could be a faster and fairer way, as all its charges will be visible to you upfront.

Receive money internationally with Xoom

As mentioned earlier, with Xoom, you can receive funds in India only from the US, UK, Canada, and Great Britain. But apart from this limitation, Xoom is a convenient option to transfer money in India. Xoom has set up certain levels of transfer accounts, which determine the amount of money that can be transferred by a user within a specific time frame. These amount limits vary, depending on the senders country of residence⁶.

In India, Xoom offers two modes of money transfer, namely, through bank deposits and cash pickups.

Xoom bank deposit

Bank deposits are the most preferred means to transfer money across borders, as the money is transferred directly into the recipient's bank account in INR. You can receive money via Xoom in almost all major Indian banks 3.

Xoom cash pickup

Cash Pickup is the mode of money transfer, wherein you can receive physical cash in INR, from a designated pickup location. It is a faster option than bank deposits, as Xoom normally processes such transfers within minutes. However, the maximum amount that you can receive via cash pickups is limited to 50,000 INR. Therefore, for bigger amounts, cash pickups are not available.

Sign-up and process to receive money

For receiving money from a Xoom transfer in your bank account, you won’t have to do anything. Your money will reach your account, and when it does, you’ll be notified by your bank. For cash picks, however, you’ll have to visit the pickup location and provide them the Xoom transaction number and one of your own identification documents, to receive cash. That's it.

Xoom fees and charges

For money transfers below 1000 USD, Xoom charges a transaction fee on a percentage basis whether the sender is paying the money through credit card, debit card, or his bank account. This transaction fee is to be paid by the sender and varies on the basis of the payment method used, recipient country, and currencies involved. However, Xoom claims to offer free transfers, if the sending amount is more than 1000 USD and the payment is through a bank account. But that’s not exactly the truth. Xoom, itself admits that it usually makes money while converting money between currencies⁷ ⁸. Yet, it must not be surprising, as it is what most money transfer service providers do, including banks, which markup the exchange rates to increase profit margins.

For instance, let’s consider the table below, depicting the transfer of 500 USD in a US bank to an Indian bank in INR, through Xoom.

Amount transferred Transfer fee for bank deposit Exchange rate Amount received
500 USD 4.99 USD 68.6317 34,316.00 INR
1000 USD 0.00 USD 68.6317 68,632.00 INR

collected on 11 June 2019

As you know, for transactions below 500 USD, Xoom charges a transfer fee on a percentage basis. In this case, of 4.99 USD (subject to change) will be deducted from 500 USD. So after deducting this fee, the amount that will be converted will be 495.01 USD (500 USD - 4.99 USD). Hence, the amount received by the recipient will be 34,316.00 INR.

However, if the amount is equal to or above 1000 USD, Xoom doesn’t charge any transfer fee. Thus when transferring 1000 USD, the amount that will be converted is 1000 USD. The recipient will receive 68,632.00 INR. Also, if the sender pays via credit or debit cards, he will be charged higher transfer rates.

Sounds good? Transferring money with Wise could be even better. This is for the reason that Wise is more honest than most money transfer services, including Xoom and many banks. Here’s another example for transferring 1000 USD from a US bank to Indian bank in INR, for your understanding. The details below are in case of bank deposits, paid through bank accounts.

Provider Fee Exchange Rate Amount Received
Xoom 0.00 USD 68.6317 68,632.00 INR
Wise 9.08 USD 69.39150 68,761.43 INR

collected on 11 June 2019

If you compare Xoom and Wise, you’ll notice that even after offering fee-free transfer, Xoom transfers a slightly lower amount to the recipient’s account. And on the other hand, Wise charges a fee and still, the recipients get a bigger amount. The difference lies in the fact that despite charging a fee, Wise offers the real exchange rate, without any hidden fees.

You can easily check the real mid-market rate on Google, Yahoo Finance, etc. While Xoom misleads you by offering you fee free transfers, it has adjusted its profit in the reduced exchange rate. When it comes to international money transfers, Wise could be a cheap and honest companion.

How much time does it take

The time for transfers with Xoom depends on a number of factors, including the payment medium used by the sender, the mode of transfer, and on your bank’s processing time. Xoom usually processes cash pickups within minutes. But in the case of Bank transfers, you’ll receive the amount within four hours in your Indian bank account, when sent during Indian bank processing hours. Moreover, for the US resident senders, Xoom claims instant bank deposits with its four partner banks - PNB, Axis Bank, HDFC Bank, and Yes Bank⁴. Hence, if you have an account in one of these banks, you will have an added advantage with respect to transfer time.

However, if the transfer amount is above 10,000 USD, in a single transfer, or within 24 hours, it might take additional 2-3 business days for the money to reach your account. This is because, Xoom will have to settle funds with the concerned bank, before the actual money transfer⁵. So it may end up taking up to four business days to complete the entire process.

If you are looking for a faster money transfer, Wise could be a better option. Wise can deliver money in your bank account faster, from within seconds to a day or two, even for larger amounts.

Send money abroad with Xoom

As of now, Xoom doesn’t offer the service to send money from India to abroad. So for this, you’ll have to look for another money transfer service.

The true cost of international transfers with Xoom

So while it comes with the strong backing of Paypal, you must know the real costs of your transfers with Xoom. To make it easy to understand, let's compare Xoom with Wise once more, for sending 1000 USD from the US to India in INR.

Provider Fee Exchange Rate Amount Received Actual Cost
Xoom 0.00 USD 68.6317 68,632.00 INR 10.94 USD
Wise 9.08 USD 69.39150 68,761.43 INR 9.08 USD

collected on 11 June 2019

Sending 1000 USD by Xoom isn’t free, as claimed by Xoom, as they actually earned a profit of 10.94 USD. in simple words, Xoom charges a hidden fee, without the knowledge of customers. You may well understand that if you frequently use Xoom for your international money transfers, your fees will actually pile up to a greater amount, all while considering yourself lucky to have found a fee free service. On the contrary, Wise informs you of all the costs and recipient’s amount upfront.

A cheap, fast and transparent alternative: Wise

Most of us send money across countries to our friends and family. In such a scenario, it’s important that you find an international money transfer service that knows the value of your hard earned money. You must especially be cautious of what and how you are being charged for your transfers, besides the safety, security, and speed of transferring money. And when you have an option like Wise, that fits in all your requirements well, you must consider giving it a try.

Moreover, you can rest assured of being charged the fairest rates, and if not convinced you can check them yourself on the internet. Since Wise doesn’t lure anyone with free transfers and charges a fair fee for every transfer, it might be hard to find another service provider that’s this transparent. If still not convinced, you may compare Wise with other competitors, or check the rates it offers.

Sources used for this article:

  1. https://www.xoom.com/about
  2. https://www.paypal.com/cs/smarthelp/article/what-is-xoom-and-how-does-it-work-faq3340
  3. https://www.xoom.com/xoom-locations?receiveCountryCode=IN&service=bankDeposit
  4. https://www.xoom.com/india/send-money
  5. https://help.xoom.com/xoomhelp/s/article/how-much-time-will-it-take-to-send-over-10-000-usd?language=en_US
  6. https://help.xoom.com/xoomhelp/s/article/how-much-money-can-i-send?language=en_US
  7. https://www.xoom.com/user-agreement
  8. https://www.xoom.com/india/send-money

This publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax or other professional advice from TransferWise Limited or its affiliates. Prior results do not guarantee a similar outcome. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date.

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