Indian Students Lose ₹1,700 Crore in Hidden Bank Fees While Funding Overseas Education: Report

While education inflation is a frequent topic of public debate in India, a lesser-known but equally pressing issue is the hidden banking charges that families incur while sending money to their children studying abroad. These silent costs—often amounting to thousands of rupees—rarely surface in mainstream conversations.

Beyond student loans, many Indian families go as far as selling land or dipping into lifelong savings to support their children's dream of an international education. However, a significant portion of that money never reaches the student as it’s lost in bank fees and exchange rate markups.

According to a 2024 report by Wise and Redseer Strategy Consultants, Indian families collectively lost Rs 1,700 crore (approximately $200 million) in hidden charges that year alone. These expenses were not for tuition or housing, but for currency conversion markups and banking fees incurred while sending remittances for living costs, tuition, and emergencies.

With over 760,000 Indian students currently enrolled in foreign universities, Indian households are estimated to have remitted between Rs 85,000 crore to Rs 95,000 crore (roughly $10–11 billion) in 2024 toward education-related expenses. Alarmingly, more than 95% of these funds were transferred through traditional banks, which typically apply an average 3–3.5% markup on foreign exchange. Along with processing charges, these transfers can take 2 to 5 business days, causing delays and adding financial pressure on students abroad.

As awareness grows, students and parents are increasingly turning to faster, more cost-efficient alternatives. Wise, a platform authorized by the Reserve Bank of India (RBI) for international money transfers, has seen education-related payments make up 75% of its total volume in India, just three years after entering the market.

Wise offers mid-market exchange rates, zero hidden fees, and an average delivery time of 12 hours—making it a compelling alternative to conventional banks. With a mission to offer transparent and fair financial services, the company recently announced plans to enable loan-based transactions that may qualify for tax exemptions under India’s revised Tax Collected at Source (TCS) rules.

These high transfer costs and delays come at a time when India’s outbound education economy is booming. India has now surpassed China as the largest source of international students in the United States. In fact, Indian students now account for over 30–35% of total enrollments in key global education hubs—up from just 11% a decade ago.

Platforms like Wise are not only easing the financial burden on Indian families, but also ensuring that the dream of a global education remains ambitious—not unaffordable.