Multiple banks. Different interest rates. Call it a "conflict of interest".
Travel loans are nothing, but personal loans taken for the specific purpose of travelling. Most lenders in the market provide travel loans for both domestic and foreign travels. If you are planning to take one anytime soon, you can check the following list and pick one to fund your exotic dream vacation.
Some of the top loan products available in the market are given as follows:
| Lender | Interest rate | Maximum loan amount | Maximum loan tenure |
|---|---|---|---|
| HDFC Bank | From 15.50% onwards | Rs.40 lakh | 60 months |
| ICICI Bank | From 11.25% onwards | Rs.20 lakh | Varies based on loan amount |
| Tata Capital | From 11.25% onwards | Rs.25 lakh | 72 months |
| Bajaj Finserv | From 12.99% onwards | Rs.25 lakh | Varies based on loan amount |
| Axis Bank | From 16% onwards | Rs.15 lakh | 36 months |
*Interest rates may vary according to the terms and conditions of lenders
Travelling is something most people dream about. Young working professionals in our country often look forward to taking a break from their busy work lives and travel to a new place for a vacation. Travel packages to many popular locations are getting increasingly popular among young travellers in India. Though travelling is a highly desired activity, many people often avoid or postpone it due to shortage of funds. Travel loans are now offered by many popular lenders in the market so that money is not a hindrance when it comes to taking your dream vacation.
HDFC Bank is one of the largest private sector lenders in India. The bank is renowned for its different types of loan products. The bank offers affordable personal loans suitable for salaried and self-employed professionals in the country. If you are looking for a loan to fund your vacation, you may use the loan offered by HDFC to proceed with your travel plans.
Benefits and key highlights:| Bank name | Processing fee | EMI (for Rs.1 lakh) | Prepayment charges | |
|---|---|---|---|---|
| HDFC Bank | 2.5% of the loan amount | Rs.2,405 (for loan tenure 5 years) | 2% to 4% of the outstanding principal amount (based on tenure) |
*Service tax or GST may be applicable over the charges given here
ICICI Bank is another top lender in the country that offers different types of personal loans for customers. The bank does not have any restriction on how the loan amount can be used. Hence, it is possible to fund your dream vacation with the help of a personal loan from ICICI Bank. The bank offers loans at attractive interest rates, and these loans can be accessed from anywhere in the country.
Benefits and key highlights:| Bank name | Processing fee | EMI (for Rs.1 lakh) | Preclosure charges | |
|---|---|---|---|---|
| ICICI Bank | 2.25% of the loan amount | Rs.2,187 (for loan tenure 5 years) | 5% of the outstanding principal amount |
*Service tax or GST may be applicable over the charges given here
Tata Capital is one of the popular non-banking financial corporations in the country. The company offers a specialised travel loan for salaried professionals in the country. You can use the funds offered here for both international as well as domestic travel. These loans are available with nominal fees and charges. The applicant must be working in the same job for at least 6 months in order to apply for this loan.
Benefits and key highlights:| Bank name | Processing fee | EMI (for Rs.1 lakh) | Preclosure charges | |
|---|---|---|---|---|
| Tata Capital | Up to 2% of the loan amount | Rs.1,916 (for loan tenure of 72 months) | Up to 4% of the outstanding loan amount |
*Service tax or GST may be applicable over the charges given here
Bajaj Finserv is another financial service provider that offers loans specifically for travel purposes. The loan amount obtained from Bajaj can be used to manage your travel bookings, accommodation, etc. The flexible repayment option offered by the company allows borrowers to pay only interest as EMI and reduce the EMI by up to 45%.
Benefits and key highlights:| Bank name | Processing fee | EMI (for Rs.1 lakh) | Preclosure charges | |
|---|---|---|---|---|
| Bajaj Finserv | Up to 3.99% of the loan amount | Rs.2,275 (for loan tenure of 5 years) | Up to 4% of the outstanding loan amount |
*Service tax or GST may be applicable over the charges given here
Axis Bank is another popular lender in the private sector. The bank offers a wide range of products for its customers. It offers a tailor-made holiday loan that comes with plenty of benefits to customers. This is an ideal product worth considering if you are looking for a loan to fund your domestic or foreign vacation.
Benefits and key highlights:| Bank name | Processing fee | EMI (for Rs.1 lakh) | Preclosure charges | |
|---|---|---|---|---|
| Axis Bank | 1.50% to 2% | Rs.3,516 (for loan tenure of 36 months) | Nil |
*Service tax or GST may be applicable over the charges given here
Since travel loans are similar to personal loans, they are mostly offered for working professionals in the country. Some of the lenders in the market provide these loans to self-employed professionals with a steady income. The common eligibility criteria for these loans are listed as follows:
Most of the top lenders in the market provide travel loans to customers with very minimal documentation. However, some of the crucial documents must be submitted (even electronically) while applying for travel loans. Some of these documents are listed as follows:
The exact documents required by companies for travel loans may vary from one company to another. You may check the official website of the lender or enquire with a company official to know the list of documents that must be submitted.
You must consider the following things before you apply for a personal loan for the purpose of travelling:
1. Are there any restrictions on how the loan amount is spent?
Once you have obtained the loan amount, you can use it any way you want. If you are using it for travel purposes, you don’t have to provide any information to the company about how much you have spent on various expenses.
2. How long do I have to wait to get the loan amount in my account?
Most lenders offer instant personal loans to customers. Approval is provided within a few hours. Loan disbursal is done within a maximum of one or two days. Hence, you can plan your travel accordingly.
3. What are the repayment modes available for travel loans?
Customers can choose to repay the loan amount through multiple modes. You may use post-dated cheques or pay cash to the company. The best way to repay the loan amount is through online transfer or by setting standing instructions.
4. Why should I provide my income proof to obtain these loans?
Since travel loans are unsecured, banks look for borrowers who have a low risk of defaulting on their loans. The income proof is obtained to assess the repayment capability of the borrower. This is also the reason why banks set a specific income requirement for applicants to apply for a travel loan.
5. How can I choose the tenure for my loan?
You may choose your loan tenure based on your repayment capability. If you can afford to pay a high sum every month, you can choose a low repayment period and pay off the loan early.
A GST rate of 18% will be applicable on banking services and products from 01 July, 2017.
The millennials are utilising the easy and fast personal loans offered by peer-to-peer lending companies to finance their international travels and recurrent weekend getaways. In fact, the personal loans taken by the youths for travels account for 12% to 20% of the total loan portfolio of the finance companies. Mostly salaried individuals who are between the age group of 28 to 35 are opting for these loans to meet their traveling needs. Millennials are considering the peer-to-peer lending platforms to avail these loans because of the minimal documentation process, long tenure, and flexible EMI repayment schedule.
These platforms connect the lenders to the borrowers and conduct the lending process through a simple process. The borrowers just have to submit an online application along with some supporting documents and the PAN number. Moreover, these platforms make use of social media and other unconventional mediums to know the creditworthiness of the borrower, unlike the traditional banks. As a result borrowers with low credit score get the required travel funding. These loans have now made it possible for the millennials to visit more expensive locations than before.
6 August 2018
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