Travel Loans: Types and Key Features

Travel loans are loans that are taken for travelling to distant places and require high amounts to meet the expenses. Travelling to foreign lands has become trendy, and it has become a necessity for the present generation to get instant satisfaction. Travel loans allow people to plan long vacations with their family and friends. These loans are usually for a shorter duration and are of a lower value. These loans are unsecured, and thus banks and financial institutions offer them as personal loans.

Travel loans are taken by the urban populace more, and some banks are yet to introduce a separate segment of travel loans. They provide personal loans which can be used for your travel expenses. Digital fintech platforms also offer travel loan to people who satisfy the eligibility criteria so that they can realise their dream of seeing new places. They also offer attractive interest rates and provide offers that attract travellers during the holiday season.

Travel loans are personal loans, and the approval of loans depends on the eligibility of the person applying for the loan. These loans do not need collateral and sometimes not even a guarantor.

Types of Travel Loans

There are different kinds of travel loans that can be provided to individuals depending upon the eligibility criteria. 

Foreign Travel – Foreign loans usually grant a higher amount, and you can use them to book flight tickets, accommodation, ground travel in cars and buses and so on. Individuals can apply for a loan for themselves and their relatives.

Domestic Travel – These loans are taken for travelling within the country. The applicant can apply for the loan, and it covers the travel expenses of his relatives and his expenses. The value of the loan is lower as compared to foreign travel loans.

Senior Citizens – Some schemes covering travel expenses are available for senior citizens. These loans have preferential interest rates.

Personal Loans – Certain banks do not have travel loans as a separate segment, and they offer personal loans which you can use for your travel expenses.

Travel loans may not be categorised into foreign or domestic travel by the banks and other lenders. The amount that can be lent depends upon the income of the applicant. Each bank and lender has a different set of criteria for checking eligibility. The applicant should understand the terms and conditions clearly before applying.

Key Features of Travel Loans

1. Low Value of Loan – The amount of money borrowed can be as low as Rs. 5000 and can go up to Rs. 25000 in the case of TripMoney. The loan does not require any guarantor or collateral.
2. Quick Loan Disbursement – Loan disbursement is done according to requirement. The applicant should chalk out the trip and get a rough estimate of the money he/she needs to borrow and apply accordingly. The applicant can apply online and after checking the eligibility of applicant the loan is disbursed immediately.
3. Short and Medium Duration for Repayment – The repayment tenure generally ranges from 3 months to 12 months. You can choose the duration according to your wish. You can repay the loan in 3, 6, 9 or 12 months.
4. Low Rate of Interest – The rate of interest is low when taking a loan from TripMoney. Their rate of interest is 20% per annum. It is low as compared to most banks and lenders.
5. Holiday Offers Available – When taking a travel loan through the MakeMyTrip app by going to the TripMoney section, you can avail of discounts and offers on flight and hotel bookings. These offers are generally available during the peak seasons.

Eligibility Criteria for Travel Loans

Most banks and financial institutions have different eligibility criteria, but certain criteria remain the same. These are:

• The applicant should be an Indian citizen and should be within a specified age limit.
• The applicant should be a salaried individual or be self-employed.
• Should have a certain amount of income monthly.

Documents required for taking a Travel Loan

TripMoney provides travel loans with minimum documentation. You can check the eligibility criteria by entering your phone number. Members whose eligibility is pre-approved can just enter their phone number and proceed to the further steps.

An applicant should enter all the details correctly and get his estimated loan amount approved. He should then complete his KYC details on the app of MMT in the TripMoney travel loan section. The documents required to get the loan approved are as follows:

• Pan Card
• Aadhar Card
• Date of Birth

You may also be asked to submit your bank statement and salary slips to prove your eligibility.

Benefits of taking Travel Loan from TripMoney

TripMoney is an independent fintech arm of MakeMyTrip and provides travel loans, forex cards and travel insurance to provide financial assistance to people while they are travelling.

TripMoney does not ask for any down payments when taking the loan. You can get the loan online with minimum documentation. They offer a flexible repayment tenure and a low yearly interest rate of 20%. You can link your bank account, and TripMoney accounts for automatic repayment of monthly EMIs when the date is due. You can get your loan approved within minutes and satisfy your urgent travel requirements.