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PayPal-owned digital remittance firm Xoom is launching in 32 markets in Europe, including the UK, Germany, France, and Italy, to enable European consumers there to send money to other countries, according to PYMNTS.
Previously, Xoom’s transfers could only originate in the US and Canada, so the move significantly increases the number of consumers who can use the service to transfer funds to its network of over 130 countries.
Here’s what it means: Launching Xoom in Europe can enable it to capture far more of the digital remittance market — estimated to comprise 35% of the $689 billion global remittances market last year — as it catches up to competitors’ levels of accessibility.
- The expansion gives Xoom access to seven of the top 10 countries worldwide for outflows of remittances. The UK, Germany, France, Spain, and Italy will join the US and Canada as Xoom’s biggest markets. The five new markets’ estimated outflows totaled more than $108 billion in 2017 — the most recent data available — adding significant volume to the US’ and Canada’s combined $173 billion. And with Xoom launching in another 27 markets, the service’s potential volume is set to skyrocket.
- Prior to extending into Europe, Xoom lagged behind competitors in originating markets. Industry leaders Western Union and MoneyGram both have 200 markets where remittances can originate from, dwarfing Xoom’s two. It even trailed other digital firms like WorldRemit, TransferWise, and Remitly, which all have at least 16 "send" countries. But now Xoom has overtaken Remitly and TransferWise in this area and closed the gap between itself and WorldRemit, which boasts over 50 markets that can send remittances.
The bigger picture: Xoom may be able to gain adoption quickly in its new markets thanks to PayPal’s existing user base.
Consumers can use their PayPal login credentials with Xoom to easily access their accounts and use Xoom’s services. Considering PayPal has millions of users in Europe already — 26 million in the UK, 23 million in Germany, 9.5 million in France, 6.8 million in Italy, and 5 million in Spain, according to a release sent to Business Insider Intelligence — this may make Xoom an attractive remittance option.
Being able to use Xoom with minimal setup or via PayPal’s direct integration with the service should make Xoom easy to use for PayPal customers, potentially allowing Xoom to start winning volume in Europe immediately. And with digital remittances gaining popularity thanks in part to their convenience and speed, being able to make digital remittances even easier because of PayPal may give Xoom a serious advantage.
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