Indians’ Spending on Foreign Studies Falls to 7-Year Low Amid US Visa Curbs
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Indians’ spending on foreign education has slumped to a seven-year low, with tighter visa rules in the United States and other popular study abroad destinations weighing heavily on families’ decisions to send money abroad for studies.
According to the Reserve Bank of India (RBI), outward remittances for education under the Liberalised Remittance Scheme (LRS) fell to $1.16 billion between January and June 2025. This marks a 22% drop from the same period last year and is the lowest first-half figure since 2018, when $1.06 billion was remitted.
June’s figure was particularly stark, with just $139 million sent abroad for education – the lowest since April 2020, when COVID-19 had severely disrupted international mobility. On average, nearly half of annual remittances are made in the first six months, making the decline especially significant.
The slowdown comes as study destinations such as the US, UK, Canada, and Australia impose stricter entry requirements. Canada has recently raised its proof-of-funds requirement to CAD 22,895, while Australia has tightened its English language criteria. In the USA, proposed changes by the Department of Homeland Security seek to cap student stays at four years, potentially ending the long-standing “duration of status” system.
These measures have not only dampened demand but also triggered a shift in preferences, with Indian students increasingly exploring alternatives in Germany and even domestic higher education institutions.
Education loan growth reflects this trend. Indian banks’ outstanding education loans rose 14% year-on-year as of June 27, slower than the 20% growth recorded the previous year. Non-bank lenders are also seeing a downturn, with Crisil projecting that education loan growth for NBFCs will nearly halve to 25% in the current fiscal year. The US share of NBFC education loan portfolios has already dropped three percentage points to 50% in 2024–25 and is expected to fall further.
Analysts suggest that unless US visa restrictions ease, the trend of reduced remittances from India for overseas studies is likely to continue, reshaping student mobility patterns in 2025 and beyond.
Source: THE PIE NEWS THE INDIAN EXPRESS
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