Xoom vs. Western Union: What’s the Difference?

For those needing to send funds to faraway places fast, Xoom (XOOM) and Western Union (WU) both offer viable money transfer options. Founded exactly 150 years apart, the two companies offer similar services, but with significant differences in the way funds can be sent, the destinations they can be sent to, and the recipients eligible to receive them.

Key Takeaways

• Western Union transfers to more countries than Xoom.
• Xoom offers lower fees than Western Union.
• Western Union allows for transfers made in cash and in person at its own agencies, while Xoom is exclusively digital.
• In some countries, Xoom offers door-to-door cash deliveries.

Western Union

Founded in 1851, Western Union (WU) has been in the money transfer business for more than 150 years, originally operating by the then-novel telegraph (the internet of its day). As of 2020, the Colorado-headquartered company’s network includes some hundreds of thousands of agent locations in over 200 countries and territories across the globe.

Customers can arrange for transfers by phone, online, in-person, or from more than 100,000 ATMs worldwide. Recipients can have funds deposited into a bank account, or pick up cash at a WU location.

Western Union also offers money orders for purchase and bill-paying services.

Important

Both Western Union and Xoom make money from the transfer fees they charge on transactions and from currency exchange rates.

Xoom

Xoom (XOOM) came on the scene in 2001. PayPal acquired the San Francisco-based company in 2015. Its international money transfer service is available in over 120 countries, as of 2024.

Customers can only send money online using their mobile phone, tablet, or computer. Recipients generally have funds deposited into a bank account, though cash pickup is available in many nations where Xoom has partners, as is door-to-door delivery.

Xoom also offers bill-paying and mobile phone-reloading services.

Key Differences

Along with the number of countries they serve and the methods for sending funds, Western Union and Xoom are distinguished by several other factors.

Fees and Exchange Rates

For the most part, Xoom offers lower prices on international money transfers than Western Union. Xoom can charge lower fees because it does not have the overhead of maintaining physical centers like Western Union.

Keep in mind that both Xoom’s and Western Union’s fees vary depending on your country, the country to which you are transferring money, your funding source, the payout currency, and the overall transfer amount. The majority of Xoom’s transactions are sent to Mexico and the Philippines, funded from a bank account and disbursed in local currency. However, Western Union may offer better exchange rates.

Eligible Recipients

If you need to transfer money to an inmate, you’ll have to go with Western Union. Its website allows you to search by correctional facility, and it offers a Send2Corrections app to facilitate transfers, as well.

Cash Transfers

With Xoom, customers can only transfer money from a bank account, debit or credit card, or a PayPal account. Because Western Union has physical locations staffed with agents worldwide, it accepts cash for money transfers. If you or your recipient doesn’t have a bank account, Western Union is probably the better bet. 

Speed

Although Xoom promises instant transfer in certain countries, the company often has very little control over the actual delivery to the recipient’s account. That’s because processing times depend on each individual bank. On the other hand, Western Union can ensure quick delivery because it has its own agents across the globe.

When Was Western Union Founded?

Western Union was founded in 1851 as a telegraph company. It didn’t start sending money electronically until 1871.

Where Was Western Union Founded?

Western Union was founded in Rochester, New York.

When Did PayPal Acquire Xoom?

PayPal acquired Xoom in 2015.

The Bottom Line

Xoom and Western Union both offer money transfer options. Xoom is more limited than Western Union in terms of recipients, locations, and transfer options, but tends to charge lower fees.