CHENNAI: Indians are moving towards foreign destinations with a vengeance as most countries have opened up to tourists following the pandemic-induced restrictions. The combination of stalled demand and financial stress has meant that many of them are opting to pay for their international vacations with EMIs. Travel companies are seeing a surge in demand for ‘Buy Now, Pay Later’ (BNPL) offers, which are trending towards working professionals, especially in the IT sector and honeymooners.

Travel loans contribute only 1-2% to the Gross Merchandise Value (GMV) of travel agents. But these loans as a payment option are expected to grow to around 5% of the total. GMV subsequent years. Leading tour operators are looking at EMI options for 40% of their customers to further their travels. For example,

Consumers looking for viable alternatives to holiday funding have seen an increase of over 25%. While it has partnered with a fintech for its ‘Travel Now and Pay on Return’ initiative, Rajeev Kale, President and Country Head, Holiday, Thomas Cook (India) said, “In addition, we are partnering with several bank partners Also provide credit facilities. Repayment in 3-13 monthly installments.”

Daniel D’Souza, president and country head-holidays, SOTC Travel, a subsidiary of Thomas Cook, said the average transaction size for an international travel loan is Rs 1.5 lakh.

Chennai based travel company, Madura Travel Service, has also registered a growth of 30% between January and June this year as compared to a year ago, in the number of honeymooners and small families with external fund sources like credit cards with EMI option, personal and travel loans from banks, NBFCs and fintech for its travel purposes. “In the past, people used to save and pay for their travels. But post-Covid, it has become easier for them to take loan and repay it later as they have become used to EMIs in recent times,” said Sriharan Balan MD of Madura Travel Service. He said that from 10% in 2019, the number of people looking for EMI options through credit cards and loans for their overseas tours has increased to 40% in 2022.

Travel fintech, Sunkash, which has processed international travel loans worth around Rs 70 crore between January and June, has registered a seven-fold increase in queries post-Covid, as compared to the pre-pandemic year.