Xoom, PayPal‘s (NASDAQ: PYPL) cross-border money transfer service, announced that U.S. users now have the option to fund money transfers to friends and family abroad using USD converted from PayPal USD (PYUSD), a U.S. dollar-denominated stablecoin2.
Rolling out to customers in the U.S. starting now, the new funding option “will allow U.S. Xoom users to easily convert the PYUSD in their linked PayPal Cryptocurrency Hub to USD and use that as a funding source to send money to recipients in approximately 160 countries globally with no Xoom transaction fees.”
Xoom’s new option comes at a time “when consumers are seeking cost-effective options for cross-border payments.”
According to the World Bank’s Q3 2023 report, “the global average cost of sending $200 is just over 6%. With no Xoom transaction fees,3 cross-border money transfers funded using USD converted from PYUSD provides a lower cost option on Xoom.”
By introducing the option to fund cross-border money transfers with USD converted from PYUSD, Xoom now “offers a way for U.S. users to send money abroad using PYUSD as a funding source.”
When this option is selected, Xoom will convert the PYUSD in a U.S. user’s PayPal Cryptocurrency Hub to USD currency “with no crypto sale fee, and recipients will receive funds in the fiat currency selected by the sender.”
Jose Fernandez da Ponte, Senior Vice President of the Blockchain, Cryptocurrency, and Digital Currency Group, PayPal said:
“When we decided to bring PayPal USD to market, we had two objectives we wanted to achieve: create something that had a stable value to maximize user confidence and ensure it had utility for commerce and payments. Enabling U.S. users of Xoom the option to fund cross-border money transfers using PYUSD builds on our goal of driving mainstream adoption of cryptocurrencies while also offering an easy way to securely send money to friends and family at a lower cost.”
U.S. Xoom users with a sufficient PYUSD balance in their PayPal Cryptocurrency Hub to cover an eligible Xoom transaction “will be able to select PYUSD to fund their transfer when using Xoom.com, PayPal.com, and the PayPal app.”
Transactions that are not completed in USD “are subject to a transaction exchange rate, which includes a currency conversion spread.”
A key player focused on digital remittances, Xoom claims that it is “a fast and easy way to send money, pay bills and reload phones for friends and family in approximately 160 countries globally.”
With Xoom, customers can reportedly “access a fast and reliable way to send money, by simply downloading the Xoom or PayPal mobile app, or visiting Xoom.com or PayPal.com.”
PayPal, Inc. is licensed to “engage in virtual currency business activity by the New York State Department of Financial Services. Buying, selling, transferring, and holding cryptocurrency with PayPal is not available in Hawaii and where prohibited by law.”
