Have money, will travel. Don’t have money, will borrow for the experience – that’s the mantra most millennials, hit by wanderlust seem to follow.
India’s younger generation has understood the importance of a balanced life. And they have taken the concept of leisure consciousness to the next level. They have pushed the envelope so far that even if they don’t have money to travel, they satisfy their wanderlust with travel loans.
Let’s get to the lowdown of how millennials are contributing to the growth of India’s travel loan segment:
1. More and more millennials take personal loans or holiday loans for travel.
Millennials travel statistics:
62% of millennials go on a vacation, 2 to 5 times in a year.
10% of millennials travel 6 to 10 times a year, which is a combination of short and long travel to domestic and international destinations.
A report reveals that personal loans taken for travel purposes have increased by 55% and 85% of the borrowers are millennials.
The travel loan category accounts for 12% to 20% of the total lending portfolio.
These statistics are an indication that more and more millennials are fulfilling their holiday aspirations by opting for travel loans.
2. Millennials prefer digital lending platforms to traditional lenders.
This should not come as a surprise because millennials are a generation of young tech-savvy professionals, who find the idea of approaching traditional lenders unappealing. They do not have the patience to go through a long and exhaustive loan application process. So, they comfortable lean towards digital lending platforms. Why?
It’s easier access to loans at competitive interest rates, even to people who are new to credit or with zero credit history, and most importantly, it’s available with just a tap of a button.
3. How digital lending platforms are responding to this trend.
Several digital lenders have come up with customised travel offers for millennials. With small loan amount ranging from of ₹ 10,000 to ₹ 5 Lakh and more, and with interest rates as low as 10.99%, these loans have become a convenient and lucrative option for millennial travellers.
4. Millennials are giving wings to travel loan segment in India.
Various banks, NBFCs and digital lending platforms have acknowledged that the demand for holiday loans in India is on the rise.
- These lenders have reported a growth of 50% to 200% in holiday loan seekers in the last 2-3 years.
- Out of every 10 applications lenders receive daily, 8 of them are millennial applicants.
- If the cost of the trip goes beyond ₹ 50,000 or ₹ 1 Lakh, millennials find it easier to fund an expensive trip with a travel loan and repay in monthly affordable EMIs than make an outright payment.
About 10-15% of MoneyTap’s total loans go towards servicing customer’s travel plans. In an article published in DNA India, MoneyTap’s CEO, Bala Parthasarathy shares his observation that although people going for longer vacations or expensive destinations take loans that are in lakhs, for long weekends, the frequency of very small loans ranging from ₹ 3,000 – ₹ 10,000 has increased significantly. People do not like to disturb their monthly cash flows for these impromptu weekend gateways. Hence, a short term travel loan taken at a low-interest rate becomes a convenient option, explains Parthasarathy.
Get instant travel loan at a competitive interest rate for your national and international travel dreams. Apply for MoneyTap now.