Avail travel loans for a tension-free bindas holiday

With people continuing to work from home on most days, the trend of ‘workation’ or ‘staycation’ appears here to stay. Even with most of the world open for tourism, 90% of people admit that they plan to travel domestic in 2023, a study shows.

In addition to travelling domestically, they also wish to work from there for as long as it pleases them. Taking domestic workations or staycations allows travellers to dive deep into the culture of a place. It helps them relax and unwind, which will effectively boost their work productivity.

Millennials no longer fall in the student category. Many of them have lucrative jobs, a large appetite for travel and a heart to spend.

Until now, a common conception that only boomers would push the envelope when it comes to taking luxury vacations is fast changing. Millennials are the new spenders. A recent study shows that 17% of millennials scout for top-range options for destinations and stays during their vacation.

This will be a top trend in 2023, with most of them booking upscale resorts and hotels at expensive places worldwide, not restrict themselves to India.

Data from GWI Travel shows that 1 in 10 millennials plan to travel with their furry friends. Also, the number of pet parents has increased significantly since the pandemic, and Akasa Air has allowed dogs and cats on all its flights.

Where millennials and boomers seem to be moving away from solo tripping, Gen Z will be racing towards it in 2023. They are India’s new backpacker generation, unrelenting in their search for adventure.

Over a third of Gen Z participants in a study said that they plan to travel solo, confirming their appetite for such trips. Even global airlines like EasyJet are capitalising on this trend by continuing to offer solo traveller discounts.

Travel requires money and this is where travel loans step in. Travel loan refers to loans availed for travelling to tourist places that are faraway and will require higher amounts to meet expenses. Vacationing abroad has become a fad, in this generation where instant gratification takes a front seat. Travel loans enable the individual to plan for elaborate vacations. These are for short durations and lower value. These are typically unsecured loans and hence, many banks offer them under personal loan. The interest rates are typically high on these loans.

Travel loans are more popular among the urban populace, although many banks are yet to introduce this segment as a separate loan. Banks like HDFC Bank, ICICI Bank, Axis Bank and State Bank of India offer specific travel loans. Both private and public sector banks offer travel loans to individuals who are eligible with a view to enable them to realize their dream of traveling to various holiday destinations. As part of their promotional offer, they offer attractive interest rates and other features especially during the holiday season.

Travel loans are unsecured loans and are extended purely based on the applicant’s ability to repay the loan and the individual’s credit score. If the credit score is high, then the applicant can negotiate a nominal interest rate. Normally, when it comes to personal loan or any other form of unsecured loan, the bank will insist on a credit score of not less than 750. If the travel loan exceeds Rs. two lakh, then the bank may insist on a guarantor or collateral.

Foreign travel loans are available at a higher loan value and cover air tickets, lodging facility, sightseeing, tours etc. These loans are extended for travel within the native country. The applicant can apply for expenses that include of relatives travelling with them. The value of the loan in this case will be much lower than that of foreign travel loans.

Many banks do not label their loans depending on their use. They merely extend unsecured loans, tagged as personal loans.

Travel loans may not be categorized as foreign or domestic travel loans by many banks. The quantum of loan may be based on the income of the applicant and the credit score of the applicant. In such case, the loan so borrowed can be used for either domestic or foreign travel. Each bank may have its own eligibility criteria and regulations pertaining to unsecured loans, including travel loans.