This survey – carried out by Paisabazaar – was based on 5,700 respondents across 97 towns and cities. These holiday loans, revealed in the study titled How India Travels Using Holiday Loans (Vol 2.0 July 2025), are popular among Delhi and Hyderabad residents.
The report captured key insights such as the employment profile of borrowers, preferred holiday destinations, peak travel months, and more to better understand the mindset and needs of consumers using loans to fund their vacations.
Ahead of other needs
Around 27 percent of respondents took a personal loan to fund their vacation in H1 2025, up from 21 percent during the same period in 2023, showed the survey.
Vacations emerged as the top reason for borrowing in H1 2025, ahead of home renovations (24%), credit card bill payments (11%), medical emergencies (9.6%), education (6.1%), and marriage (5.4%), among other needs.
Small amounts
The reports revealed that holidayers do not wish to commit to larger financial obligations for funding their holidays and are, therefore, more comfortable borrowing sums which can be easily repaid within a short time frame.
About 30 percent of consumers who took holiday loans borrowed between ₹1 lakh and ₹3 lakh, 20 percent borrowed between ₹50,000 and ₹1 lakh, and 19 percent chose loan amounts between ₹3 lakh and ₹5 lakh, survey revealed.
Holiday charm among small town residents
The survey also highlighted a clear preference for vacation loans among non-metro borrowers, with 71% of applicants coming from Tier-2 and Tier-3 cities, compared to just 29% from Tier-1 cities.
Among the Top-7 Tier-1 cities, more than 50% of Holiday Loans were availed by residents from Delhi and Hyderabad, followed by Mumbai (15%), Bangalore (14%), Chennai, Kolkata and Ahmedabad at 6% each.
Despite the above trends, Paisabazaar’s CEO believes that these are early days for credit growth.
“Within financial services, consumer credit is at an exciting juncture with a large market that’s growing steadily over the years, but continues to be under-penetrated; less than 10 per cent of the population has a credit card; our household debt to nominal GDP ratio is significantly lower than the global benchmarks,” says Santosh Agarwal, CEO of Paisabazaar.
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