Hidden Costs of Studying Abroad: How Indian Families Lose ₹1,700 Crore

While budgeting for tuition and overseas expenses is standard practice for many Indian families, lesser-known hidden charges like exchange rate markups and remittance fees inflate the actual cost of sending money abroad. 

As per the Education Beyond Borders report, in 2024 alone, these overlooked costs amounted to ₹1,700 crore in lost funds, impacting thousands of families financially.

How Indian Families Lost ₹1,700 Crore in 2024

As per the report, Hidden costs in global remittances for education include exchange rate markups, transaction charges and ATM withdrawal fees. On average, banks add a 2% to 6% markup on currency exchange. For instance, with a $10,000 transfer at a bank rate of ₹90 instead of an interbank rate of ₹87, a family ends up paying ₹30,000 extra. 

Transaction fees from wire transfers, currency conversion on cards and intermediary charges add further financial strain.

ATM Withdrawals and Additional Transactional Losses

Students withdrawing small amounts abroad face ATM fees that can total $10 to $15 per transaction. Over time, this builds into a 5% to 7.5% erosion of funds. Indian debit or credit card usage overseas could result in ₹300 to ₹500 lost per withdrawal. These charges significantly reduce available living allowances.

Commission on Forced Payment Channels

Certain universities insist on payment through designated processors, inflating fees. In addition, education consultants may align with costly remittance providers without transparent fee disclosures. As choices remain limited, families unknowingly accept higher transaction costs each time.

Read More: Kisan Credit Card Accounts Dip 1.8%; Outstanding Loan Rises to ₹41,300 Cr in FY25!

Saving Options for Cost-Conscious Parents and Students

Solutions such as zero-markup student forex cards help avoid 3% to 3.5% fee structures typically seen on conventional cards. Digital rate alerts and rate lock-in tools ensure better exchange rates. Strategically consolidating transfers or choosing fixed-fee models can reduce the impact of remittance charges.

Conclusion

Awareness and preparation are key in reducing the hidden expenses of studying abroad. While ₹1,700 crore was lost in 2024 due to remittance inefficiencies, mindful planning using smarter financial tools can minimise such losses in the future.

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