Xoom Terms of Service

Item: Xoom
Rating: 38
Author: Terms.Law Editorial Team

Last updated: January 2026 | Reviewed: February 2026

PayPal subsidiary with integrated account risks. Broad fund seizure provisions, unfavorable exchange rates, and PayPal's notoriously restrictive ToS apply.

Grade D+

Terms Summary: Xoom is a PayPal subsidiary, and using Xoom means accepting PayPal's broader terms. PayPal is notorious for account freezes, fund holds, and opaque dispute resolution. Xoom's exchange rates are less competitive than standalone providers, and their terms inherit all of PayPal's problematic provisions including 180-day fund holds and broad seizure rights.

Category Scores

Rate Transparency 35/100

Fee Clarity 48/100

Fund Protection 28/100

Account Termination 32/100

Dispute Resolution 42/100

Key Findings

✓ PayPal Integration Convenience

If you already use PayPal, Xoom offers convenient integration with your existing account and payment methods. This can simplify the transfer process for casual users.

"Xoom is part of the PayPal family. You can fund your Xoom transfers using your linked PayPal account, bank account, debit card, or credit card."

⚠ PayPal ToS Applies

Using Xoom means accepting PayPal's User Agreement in addition to Xoom's terms. PayPal's terms are among the most restrictive in fintech, with broad account limitation rights and notorious customer service issues.

"By using Xoom, you agree to the PayPal User Agreement and this Xoom User Agreement. In case of conflict, the Xoom-specific terms apply to Xoom services."

⚠ 180-Day Fund Hold Provisions

Through PayPal's terms, Xoom can hold your funds for up to 180 days if they suspect policy violations, fraud, or receive chargebacks. This extended hold period exceeds most competitors.

"If we reasonably believe you have violated our Acceptable Use Policy or there is a high level of risk associated with your account, we may hold your funds for up to 180 days."

⚠ Unfavorable Exchange Rates

Independent comparisons consistently show Xoom's exchange rates are 1-4% worse than Wise for most corridors. Combined with transaction fees, the total cost is significantly higher than alternatives.

"The exchange rate you receive includes a currency conversion spread. This spread may vary based on the corridor, amount, and payment method."

⚠ Account Termination Without Warning

PayPal/Xoom can terminate accounts immediately and without prior notice. They have broad discretion to determine policy violations and limited obligation to explain termination reasons.

"We may limit, suspend, or terminate your access to Xoom or your PayPal account at any time, for any reason, without notice. We are not obligated to disclose the specific reasons for any limitation."

Terms Comparison

Feature	Xoom	Industry Standard
Exchange Rate	1-4% markup typical	0-3% typical
Maximum Fund Hold	180 days	30-90 days typical
Termination Notice	None required	Usually some notice
Parent ToS Applies	Yes (PayPal)	Usually standalone
PayPal Integration	Seamless	N/A

Recommendation

Worst in Category: Xoom's combination of PayPal's restrictive terms, unfavorable exchange rates, and extended fund hold provisions make it the least favorable option among major remittance providers. The convenience of PayPal integration doesn't justify the costs and risks.

What to Watch: If you must use Xoom, never store funds in your PayPal/Xoom account - transfer only what you need immediately. Be aware that PayPal account issues can affect Xoom access and vice versa. Always compare the total cost (fee + exchange rate) to Wise before confirming any transfer.