Hidden Fees Drain ₹1,700 Crore from Indian Families Sending Money Abroad for Education

A new report by Redseer Strategy Consultants and Wise reveals that Indian families lost an estimated ₹1,700 crore in 2024 due to hidden charges while remitting funds for overseas education. With India now the largest source of international students in countries like the US and UK, the financial burden is mounting.

 

Key highlights:

 

- Over 95% of student remittances, totaling ₹85,000–₹93,500 crore annually, are routed through traditional banks.

- These banks typically impose 3–3.5% exchange rate markups, along with intermediary fees, SWIFT charges, and receiving bank deductions.

- Transfers often take 2–5 days, adding delays to the cost.

 

Impact on families:

- A household sending ₹30 lakh annually may lose ₹60,000–₹75,000 in hidden fees—enough to cover months of living expenses or additional coursework.

- These costs are rarely disclosed upfront, making financial planning for education abroad more complex.

 

Digital alternatives:

- Platforms like Wise offer mid-market exchange rates with no markup, completing 70% of transfers within 12 hours.

- Digital remittances average 5% in fees, compared to 7% for traditional methods, according to World Bank data.

 

Broader context:

- India overtook China as the top source of international students in the US in 2024, with Indians now forming 30–35% of student populations in major destinations.

- With overseas education spending projected to double by 2030, remittance inefficiencies could cost families even more unless transparency improves.

 

Sources: Economic Times, Times Now, Observer Voice, Times of India, Financial Express