Low interest rate, easy repayment options fuel demand of travel loan among millennials

'Youngsters aged between 20 and 35 increasingly taking travel loans'

'Dance and music festivals across the globe another reason for the rise in demand for travel loan'

'Unlike previous generations who were debt-averse, millennials live along the lines of carpe diem'

'Quick and hassle-free online financing options behind spurt in people opting for travel loans'

'I had taken a loan to go to Spain and it didn't put a strain on my pocket'

We are way past the time when people would save for years to travel to their favourite international destination. Of late, travel loans have become the preferred choice, especially among millennials. Take the example of Aviral Mehta, a 26-year-old digital and marketing freelancer from Jaipur. Aviral was keen to attend music festival Tomorrowland last year in Belgium. However, his plan didn't materialise due to lack of finances. This year, he didn't want to miss out on attending the popular beer festival Oktoberfest in Munich, Germany, which began on September 21 and will go on till October 6. While planning his trip, he got to know about start-ups offering personal loans for travel at less interest rate and here he is, all set to travel to Germany. "I was apprehensive when I saw how much the trip (to Germany) would cost. I have savings, but I don't want to spend the amount until and unless it's really important. So, on a friend's suggestion, I decided to take a travel loan," he says.Aviral isn't the only one who has taken this route of funding one's travel via loans to travel the world or attend popular carnivals and music fests. A recent report by digital lending platform, IndiaLends, highlights 55% growth in personal loans for travel. More interestingly, 85% of these loan seekers are millennials who are seeking personal loans between Rs 30,000 and Rs 2.5 lakh.People enjoy a swing ride at the 186th Oktoberfest beer festival in Munich, Germany (Photo/Matthias Schrader)Travel loans on digital lending platforms are usually available at an interest rate of 0% to 1% per month, with a choice of repaying the amount in a period from three months to 60 months, making it easy for youngsters to repay the loan.Akash Dahiya, CEO and Co-founder of money-lending platform SanKash , shares, "Millennials are increasingly opting for travel loans. We have noticed more traction from young travellers aged between 20 and 35 years, enquiring about travel loans and paying in part options for the Oktoberfest. Slowly but steadily, millennials are warming up to the concept of travel loans from start-ups rather than going to banks for personal loans."He adds, "Rajasthan, Jaipur in particular, is a key market for us. Not only millennials, but holiday and experience-seeking families also drive this growth. Oktoberfest generally coincides with extended breaks owing to a few festivals in India. This has resulted in a lot of queries and travel loan application to visit Europe with one definite stop at Germany. The applications that we have processed have at least one transit point in and around Germany. There is a surge of 25% in applications received for Germany or Europe. In general, from Jaipur, we receive about five applications per day for this break during the entire month of September, out of which 40% are millennials. As far as Oktoberfest is concerned, it is not just about beer - during this time, Germany offers a lot more. Therefore, there's an increasing demand for it."People dressed in historical clothes take part in the Oktoberfest parade in Munich, Germany (REUTERS/Andreas Gebert)Akash tells us that not just international destinations, they have also been getting queries for the upcoming Sunburn 2019 electronic dance music festival in Goa, as popular American DJs and production duo The Chainsmokers and Dutch DJ Martin Garrix will be performing at the festival.Aditya Kumar, Founder and CEO, Qbera says, "There is definitely a spike in the number of applicants opting for travel loans towards the end of the year, particularly during the months of October, November and December. Considering that several international music and cultural festivals happen during these months, the easy and convenient availability of credit is encouraging millennials to go for it and make the most of their trip."Prashant A Bhonsle, CEO, Student Loans and Marketing Head, Incred, says, "Millennials are more aware, self-assured and live on the lines of carpe diem. Unlike previous generations who were debt-averse, millennials are open to taking loans for fulfilling their dreams and passion. Also, the new-age, tech-driven financial institutions are coming up with innovative offers. Since millennials love to travel and explore different cultures, places and cuisine, tech-driven financial offers that enable them to do so, with a personalized approach, turn out to be a game-changer."Make My Trip (MMT) recently introduced their no-cost booking options, which allows you to pay in easy installments with no extra interest. A representative from MMMT says, "We recently rolled out a no-cost booking option, with an aim to help travellers strike off their dream destinations from their bucket list. We've witnessed a rise in the number of people, especially millennials, availing financing options for travelling. The availability of quick and hassle-free online financing options is one of the reasons there is a spurt in people taking loans. Transactions on our platform indicate that 80% of financing requests are sourced from top 10 Indian cities; especially from travellers with over 10 years of working experience. It's also interesting to see that first-time international travellers to short-haul destinations including the Middle East, Thailand, Singapore, Sri Lanka etc, are increasingly opting for travel finance options."Shikha Rathore, an interior designer from Jaipur, is keen on attending this year's Sunburn. "Holidays are no more once-a-year event. I go on vacations as and when I get time. In December, I am planning a trip to Goa because I am a big fan of The Chainsmokers. And it has been on my bucket list to attend Sunburn festival. I had taken a personal loan earlier when I had gone to Spain and it didn't put a strain on my pocket. I could easily pay the EMIs. So, this time too, I'll be opting for a travel loan," she says.Neesha Kaul, an educationist from Gurgaon, says, "I have never been able to take my children outside India. When I approached my travel agent to look for a destination within India for this autumn break in October, he told me I could pay in parts, even after my holiday. Without telling my husband, I asked my travel agent to book it for me through this option and include Germany - I want to attend Oktoberfest. Now, the entire family is so excited that for the first time our passports will be put to good use other than just for address proof."