Indians are travelling more and more. Young Indians are earning more than ever and turning fancy-free and footloose. According to reports, Mastercard Economics Institute’s fifth annual report on travel trends has stated that in January-March 2024 as many as 9.7 crore passengers have passed through Indian airports – a four-fold rise over the past 10 years.
Interestingly, as the income of young Indians rises and obligations decline, banks are becoming more and more ready to fund their trips with loans. Travel loans are, however, another type of personal loans, for which the appetite is growing in India.
Interest rates, processing fee
According to Bankbazaar, loans are extended both for trips within India and abroad. The minimum rate of interest on such loans begins from 10.75%. The maximum repayment tenure is 6 years for this category of loans.
The upper limit of travel loans is capped at Rs 40 lakh and there is a processing fee of more than 4% for such loans.
HDFC Bank, Axis Bank, Tata Capital
India’s biggest privates sector lender HDFC offers a maximum of Rs 40 lakh of travel loans. Bankbazaar states that the interest rate begins at 10.50%, while the loan has to be extinguished within 5 years. It levies a 2.5% processing fee as well.
Another major private sector lender Axis Bank lends a maximum of Rs 15 lakh and charges interest of 10.25% on these loans. The maximum repayment period allowed is 5 years.
NBFC major Tata Capital, however, allows 6 years to repay travel loans. The maximum loan it sanctions is Rs 25 lakh and charges interest of 10.99% for it. It charges a 2% processing fee as well.
Whether one undertakes solo trips, or travel in groups, or goes on romantic getaways including honeymoons, banks are ready to fund everything.
Eligibility
Like any other loan, banks/NBFCs insist on a sound credit score – at least 700 – to sanction these loans. One has to be at least 21 years of age to apply for such a loan.
While the new and well-heeled travelling class presents a new opportunity for the travel, hospitality and leisure industry to tap new potential, it also offers new business opportunity for the banking sector to expand its retail loan portfolio.
Indians are travelling more than ever and banks/NBFCs are ready to fund your trip to that dream destination of yours. Personal Finance Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
