Travel remittances drive forex outflows as Indians spend more abroad, say experts


Outbound remittances under the travel category are rising steadily as more Indians spend on overseas trips and premium stays. Reserve Bank of India (RBI) data for April 2025 shows travel spending crossed $1.3 billion, making up over 50% of total outward flows under the Liberalised Remittance Scheme (LRS).

Vinay Bagri, Co-Founder and CEO of Niyo, said this trend is visible in card spending patterns.

“We’re seeing growing spends by young travellers, students, and working professionals. Rising outbound spends reflect India’s deepening global participation and growing consumer confidence,” he said.

While total outward remittances for FY 2024–25 dipped 6.85% to $29.56 billion, travel continues to lead.

Travel remittances stood at about $16.96 billion — roughly 57% of total outward flows. March and April 2025 saw a rebound, with March recording a 12.3% year-on-year rise and April an 11% jump in travel-related remittances.

Karan Agarwal, Director at Cox & Kings, said strong travel demand is driving these numbers.

“Consumers are  spending on long-haul, short-haul, experiential and luxury vacations. More customers are going further and staying longer. Travel continues to anchor the outbound remittance story, despite some moderation in education, medical and other components,” he said.

Hospitality industry players confirm that a large share of forex is going into luxury travel and wellness stays.

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Vaipanya Kongkwanyuen, GM at Thailand’s Chiva-Som Hua Hin, said Indian arrivals rose from 1.6 million in 2023 to 2.1 million in 2024, with sustained growth this year. “Affluent Indian guests are spending more per day on wellness treatments and bespoke services,” he said.

In Sri Lanka, Chamindra Goonewardene, VP at Resplendent Ceylon, said Indian guests are staying longer and spending more than before. “We see more high-net-worth travellers looking for immersive wellness and nature-led experiences. The average length of stay and daily spend have both increased,” he said.

The Maldives is seeing similar trends. Dermot Birchall, GM at Kandima Maldives, said Indian guests are spending more on private dining, spa services and milestone celebrations. “Average stays are longer and guests want privacy, wellness and curated experiences,” he said.

Industry experts say travel providers are partnering with Indian banks, travel agents and luxury concierge networks to offer customised packages and loyalty perks. This drives more forex outflows under the travel head, which remains a key element in India’s outward remittance profile.

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