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India Today
2 days ago
- Business
- India Today
Indian students lose Rs 1,700 crore to hidden bank fees in 2024: Report
When an Indian student boards a flight for New York, London, or Melbourne, they aren't travelling alone, not in spirit, and certainly not in sacrifice. Behind every young scholar is a family that has chosen to stretch its limits. They sell land, dip into retirement savings, take education loans, and pool family incomes. It's a quiet revolution carried out in living rooms, not while their story is familiar, a new cost has entered the picture, one not found in any college brochure or visa 2024, Indian families collectively lost Rs 1,700 crore, around USD 200 million, not to tuition fees or housing, but to hidden charges from banks. This figure, drawn from a report by Wise and Redseer Strategy Consultants, represents what was paid in exchange rate markups and banking fees alone. It is a cost invisible to most, but immense in its grasp the scale, consider this: the amount lost is nearly three times the budget of India's Chandrayaan-3 moon THE NUMBERS ADD UPOver 760,000 Indian students are currently studying abroad. Most rely on their families to send regular remittances to cover living expenses, tuition, and unforeseen report estimates that Indian households remitted between Rs 85,000 to Rs 93,500 crore (USD 10–11 billion) in 2024 for educational 95% of these funds are sent via traditional banks. The banks, in turn, apply an average 3-3.5% markup on currency processing fees and delays of 2–5 working days, and the impact is hard to a family sending Rs 30 lakh a year, this means Rs 60,000-75,000 lost to hidden charges, an amount that could cover several months of living expenses or a semester of STUDENTS ARE SAYINGPriyanka Agarwal, an Indian student in the United States, explains it plainly: 'The loan helped. But the forex service I used made all the difference. I didn't know how much we had been losing in earlier transfers until we switched.'Harusha, also in the US, points to the urgency of everyday life: 'My parents used to transfer money through the bank. It would take two to three days. But sometimes, I needed the funds immediately, for rent or emergencies.I switched to instant platforms, and it felt like a burden lifted.'Their stories echo a larger shift. Education-related payments now account for 75% of Wise's volume in India, just three years after the company entered the promise: mid-market exchange rates with no hidden fees, 12-hour average delivery time, and transparency in ISSUE OF TRUST AND TRANSPARENCYTaneia Bhardwaj, South Asia Expansion Lead at Wise, put it bluntly: 'Students today move fast. Their payments should, too. Five-day waits and surprise charges aren't just an inconvenience -- they're disruptions to education.'She adds: 'It's not just about efficiency. It's about fairness. When a parent makes sacrifices for a child's education, that money should reach where it's needed -- not disappear in invisible margins.'To address regulatory barriers, Wise also announced its plan to support education-related transactions made through loans, which may qualify for tax exemptions under India's updated TCS (Tax Collected at Source) rules.A BROADER ECONOMIC UNDERTONEIndia's outbound education economy is growing rapidly. In 2024, for the first time, India overtook China as the leading source of international students in the now account for over 30-35% of student enrolments in major study destinations. Just ten years ago, this figure stood at 11%.As education transforms into a key pillar of the Indian middle-class aspiration, remittance channels must story is no longer just about reaching top universities, it's about reaching there without bleeding dry on the the end, this is not just about banking or transfers. It's about trust. It's about making sure that every rupee sent carries the full weight of a family's hope -- not the burden of opaque families prepare to double their spending on education by 2030, the cost of financial inefficiency becomes a national that requires better systems, clearer regulations, and a renewed respect for what these families are trying to build, one tuition payment at a question isn't whether Indian students will continue to pursue global dreams. They will. The question is whether the system will let them do it without losing more than they already give.- EndsMust Watch
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Business Standard
3 days ago
- Business
- Business Standard
Foreign education costs for Indian families may double to $91 bn by 2030
Indian families might have to spend as much as $91 billion on foreign education by 2030, up from $44 billion in 2024, according to The Indian Express, citing a report highlighting a growing concern wherein families could lose nearly half a billion dollars in hidden fees and exchange rate markups while transferring money through traditional banking channels. The report by Wise and Redseer Strategy Consultants reveals that approximately $11 billion of the total spending in 2024 came from money transferred directly from India. Over 95 per cent of these remittances were sent via conventional banks, which charge a 3-3.5 per cent markup on exchange rates. The Reserve Bank of India (RBI) has been working to reduce the cost of international transfers. According to the World Bank data, the average global cost of sending remittances stood at 6.62 per cent in July-September 2024, The Indian Express reported. Multiple intermediaries involved in international payments drive up both costs and delays. These challenges have prompted central banks, including the RBI, to explore digital currencies and promote instant payment linkages like India's UPI. This week, the National Payments Corporation of India expanded the UPI-Singapore PayNow system by adding 13 more Indian banks, increasing the total to 19. Drop in outflows for education Recent RBI data shows a decline in money sent abroad under the Liberalised Remittance Scheme (LRS). In April 2025, remittances for overseas education fell 21 per cent year-on-year to $164 million. For the first four months of 2025, the total dropped to $874 million, marking the ninth straight month of decline. Under LRS, Indians are allowed to remit up to $250,000 annually for various purposes, including education, travel, and investment. Rise in student numbers despite visa hurdles Despite these trends, the number of Indian students abroad is projected to cross 2.5 million by 2030. In 2024, Indians represented nearly one-third of all international students in countries like the US, UK, Canada, and Australia — a sharp rise from 11 per cent a decade ago, the Inews report said. While these traditional destinations remain popular, tighter visa and admission policies are pushing students to consider new countries. For instance, Canada raised the required proof of living expenses, and Australia increased the minimum IELTS scores. As restrictions rise in traditional hubs, countries like Germany, Ireland, and New Zealand are emerging as attractive options. These nations offer simplified visa processes, better post-study work options, and more relaxed residency rules.
Indian Express
4 days ago
- Business
- Indian Express
Indians' spending on foreign education could double to $91 bn in 2030
Indian families could end up spending $91 billion on foreign education for their children in 2030, up from $44 billion in 2024, with the money they lose due to exchange rate markups and fees charged by traditional banking players potentially approaching half a billion US dollars. According to a report by global payments firm Wise and Redseer Strategy Consultants, released on Friday, around a quarter of the annual foreign education spending of Indians — amounting to roughly $11 billion in 2024 — is met through money transferred overseas from India, with the rest largely coming from earnings and financial support within the destination country. According to the report, more than 95 per cent of these remittances go through traditional banking channels, which charge a mark-up of 3-3.5 per cent on the exchange rate. 'A typical family sending Rs 30 lakh annually may lose Rs 60,000–75,000 to hidden markups, enough to cover several months of living expenses or fund additional courses. Across the 760,000 Indian students heading abroad, this amounts to a significant hit to their pocket,' Wise and Redseer said in a statement, adding that in 2024 these costs totalled $200 million, or Rs 1,700 crore, for Indian families. The high cost of cross-border transfers has been a key focus area for the Reserve Bank of India (RBI), which has in recent years highlighted the fees and time delays associated with them. According to the World Bank, the global average cost of sending remittances was 6.62 per cent of the amount in July-September 2024. The cost of making international payments rises depending on the number of intermediaries, or correspondent banks, involved, with fees being charged and operational delays possible at every stage. These costs and delays have been a key driver of central banks exploring the use of their digital currencies to make cross-border transfers. The government and the RBI have pushed for the linking of national instant payment systems, with India's Unified Payments Interface (UPI) linked with Singapore's PayNow. Earlier this week, the National Payments Corporation of India enhanced the UPI-PayNow linkage by adding 13 more Indian banks — taking the total to 19 — whose customers can receive remittances from Singapore via UPI. According to latest RBI data, the money sent abroad by Indian residents for overseas education under the central bank's Liberalised Remittance Scheme (LRS) fell 21 per cent year-on-year in April to $164 million. In fact, expenditure under the LRS for overseas studies was down 21 per cent for the first four months of 2025 at $874 million, with the fall in April being the ninth month in a row that money sent abroad for studies under the scheme was down on a year-on-year basis. Under the LRS, the RBI permits residents to send up to $250,000 abroad every financial year for certain current and capital account transactions, including travel, studies, medical treatment, and investments in foreign stocks, among others. The continued fall in money sent abroad by Indians for studies comes amid uncertainty in the US, with the number of student visas issued to Indians in the first nine months of 2024 down 38 per cent year-on-year, The Indian Express had reported in December 2024. However, according to the Wise-Redseer report, the number of Indian students studying abroad could cross 25 lakh in 2030. Indian students made up around a third of the international student population in key education hubs such as US, Canada, UK, and Australia in 2024, up from 11 per cent a decade ago, according to the report. 'Traditional destinations remain attractive while emerging hubs such as Germany, Ireland, the UAE, and Singapore gain traction due to affordable costs, and strong post-graduation employment opportunities,' it added. To be sure, key destination countries such as the US, Canada, UK, and Australia have tightened visa and admission policies for international students, the Wise-Redseer report said. Canada, for instance, has more than doubled the minimum proof of living expenses in the last couple of years to 22,985 Canadian dollar starting September 1. In Australia, the report said, the required IELTS score — a measure of applicants' English proficiency — was last year increased by 0.5-1 points across several categories. 'Considering these challenges, alternative destinations like Germany, Ireland, and New Zealand are gaining traction. These countries offer benefits such as streamlined visa processes, enhanced post-study work opportunities, and relaxed residency policies,' the report said. (1 Canadian dollar equals Rs 62.794 as recorded at 9:52 pm IST on July 18, 2025)
