Holiday On EMI: Millennials Lead Loan Bandwagon; Over 70% Applicants From Tier 2 Cities
A consumer insights survey by Paisabazaar highlights a growing trend of using personal loans to fund holidays among Indians.
More Indians are now opting for personal loans to fund their dream vacations, according to a survey by leading online lending platform Paisabazaar. The survey revealed at least one among four respondents used personal loans for a holiday.
Paisabazaar spoke to over 5,700 people from 97 towns and cities to understand this trend through its survey. The report titled, 'How India Travels Using Holiday Loans (Vol. 2.0)', shows how people are using personal loans to fund their vacation.
27% Respondents Took Personal Loan For Vacation
According to the Paisabazaar report, 27% respondents said they borrowed money to go on a vacation in the first half of 2025, making it the most common reason for taking a personal loan. This was followed by home renovation (24%), credit card bill payment (11%), medical emergency (9.6%), education (6.1%), and marriage (5.4%), among other reasons.
Holiday Loans Popular In Small Cities
According to the survey, 71% of holiday loan applications came from Tier-2 and Tier-3 cities, while only 29% were from Tier-1 cities. Cities like Lucknow, Surat, Jaipur, Patna and Durgapur witnessed a surge in demand for personal loans to fund a vacation.
Millennials Lead In Taking Holiday Loans
Millennials, aged between 30 and 40 years, were the main group taking holiday loans. But there’s also been a big jump among Gen Z borrowers, which includes the 20 to 30 age group. In the first half of 2025, nearly 29% of those who took holiday loans were Gen Zs.
How Much People Borrowed For Holidays
Around 30% of people who took holiday loans borrowed between Rs 1 lakh and Rs 3 lakh. Another 20% borrowed between Rs 50,000 and Rs 1 lakh, while 19% opted for higher loans between Rs 3 lakh and Rs 5 lakh.
Most holiday loan applicants were people working in private companies, making up 65% of all borrowers. They were followed by business owners (17%), self-employed professionals like doctors and CAs (12%) and government employees (6%).
Most Popular Destinations
South East Asian countries like Thailand, Vietnam, Singapore, Hong Kong, Sri Lanka, Mauritius, Maldives, Malaysia and Bali topped the list with 44% of those who took a holiday loan choosing these destinations. The Middle East was the next popular choice (32%), followed by the USA and the UK (20%). For holidays within India, Goa was the most preferred destination.
