63% of Indians are choosing Thailand, Japan and Singapore; ICICI report links trend to growing financialisation

by

New Delhi: With more than 3.08 crore Indian travellers moving abroad for vacation in 2024, nearly 27 per cent took personal loans to travel for the trip. Where Schengen visa rejections alone wiped out Rs 136 crores in application fees, and now India’s travel insurance market is racing toward a $4.17 billion valuation by 2031, the data report by ICICI Lombard and Hansa Research shares.

The report estimates that India will become the world’s fifth-largest outbound travel market by the end of 2027, rising from 10th place in 2019. The surge is being powered by the increase in income rates, digital bookings, visa relaxations, flexible financing options and a generational shift in how Indians view travel over the generations; it is not a luxury anymore but an essential part of living and relaxing.

Travel – no longer in cash but with loans

In the first half of 2025, 27 per cent of people taking personal loans used them for travelling, compared to 21 per cent in 2023. Also, 71 per cent of these borrowers were from Tier-2 and Tier-3 cities, showing that smaller cities are pushing themselves more towards the trend. As per the report, the financialisation of travel has played an important role in this surge.

A global report mentioned in the study says 74 per cent of Indians now choose to spend on travel instead of luxury items, showing a clear shift in what people value. For many consumers, travel has now become a new symbol of status.

India’s per-capita income has been rising steadily at 8.7 per cent each year since 2015, and this growth is driving people to spend more on experiences. Now, Indians are investing in flights, international hotels, cruises, adventure trips and even wellness retreats abroad

Asia dominates the Indian outbound flow

Asia remains the top choice for Indian travellers, attracting 63 per cent of all trips. Among these destinations, Thailand leads with 21 per cent, followed by Japan at 19 per cent and Singapore at 15 per cent. The United States continues to be the most visited country overall, while France and the UK remain the top favourites in Europe.

The report points out several major concerns, such as climate-related disruptions in Europe and Southeast Asia, ongoing geopolitical conflicts like Russia–Ukraine and tensions in West Asia, growing fear of flying after recent air crashes, and significant financial losses caused by rising visa rejections.