Indians Cut Back On Foreign Study Spending As US, Canada Tighten Rules

Fewer Indian families are wiring money overseas to pay for their children's education this year. Fresh data from the Reserve Bank of India (RBI) shows that remittances for foreign studies have dropped to their lowest level in seven years, and the reasons are tied closely to new rules in popular study destinations like the US, UK, Canada, and Australia.

The Numbers Tell the Story

Between January and June 2025, Indians sent about $1.16 billion abroad for education. That's a 22% drop compared to the same period last year and the lowest figure since 2018. Even in June alone, the amount slipped to $139 million-numbers not seen since the peak of the COVID-19 disruption in April 2020.

Why the Drop?

The biggest reason: studying abroad is getting harder and more expensive.

• Canada doubled the proof-of-funds requirement for students to CAD 22,895.
• Australia raised the minimum English test score needed.
• United States is pushing for stricter student visa timelines.

Put simply, students now face more hurdles, higher costs, and greater uncertainty when applying overseas.

Banks and Loan Companies Feel the Heat

This slowdown is showing up in India's education loan market too. Bank loans for studies abroad are growing at a slower pace, while NBFCs (non-banking financial companies) expect their education loan growth to halve this fiscal. Even within NBFC portfolios, the share of loans linked to US studies has already dipped.

As Crisil Ratings' Malvika Bhotika explained,“While banks do have a large domestic portfolio, around 50% or just over that is linked to overseas education.”

What Are Students Doing Instead?

Experts say two clear trends are emerging:

• Looking beyond the“big four” – Countries like Germany and other European nations are drawing more Indian students, thanks to lower tuition fees and easier entry rules.
• Choosing India – With several Indian universities improving their offerings and global tie-ups, more students and families are giving local options a serious look.

MENAFN03092025007385015968ID1110009710