A new report by Paisabazaar, recently covered in The Times of India, reveals a striking shift in how Indians are using personal loans. In the first half of 2025, nearly 30% of all personal loans were taken for travel purposes — a steep rise from 21% in 2023. This clearly indicates that Indians, especially the younger generation, are increasingly willing to finance their vacations through EMIs.
Travel Loans Surpass Traditional Needs
Interestingly, spending on holidays has overtaken several conventional uses of personal loans, such as:
- Home renovations – 24%
- Credit card debt consolidation – 11%
- Medical emergencies – 9.6%
This change is being driven by a digitally savvy, experience-focused generation that prefers breaking down travel costs into easy monthly instalments instead of paying a lump sum.
Millennials Lead, Gen Z Rising Fast
While Millennials still make up almost half of the total travel loan share, the fastest growth has come from Generation Z. Their share of travel loans has more than doubled since 2023, making them a key emerging segment for travel financing.
Smaller Cities Join the Travel Boom
It’s not just metro cities driving this change. The report highlights a significant spike in travel loan applications from Tier 2 and Tier 3 cities, showing that the desire to explore the world is no longer limited to urban centres.
Why the Surge?
- Changing priorities – Indians, especially the youth, are prioritising experiences over material possessions.
- Easy financing options – Instant approvals and paperless processes on platforms like Paisabazaar have made travel loans highly accessible.
- Affordable EMIs – Flexible repayment options allow travellers to manage costs without financial strain.
The takeaway? Travel is no longer a luxury reserved for the few — it’s becoming a planned, budgeted, and financed experience for many Indians.
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