The sharp depreciation of the Indian rupee against the US dollar, breaching the historic 90 mark, is delivering a financial shock to thousands of Indian students planning for or currently pursuing higher education overseas. This currency slide, occurring just as a large batch prepares to depart for the spring semester in February, is forcing a major rethink on how to fund international degrees.
Financial Strain at Every Stage
The rupee's decline to an all-time low of 90.56 against the dollar on Thursday, 5th December 2025, before settling around 89.94, has a cascading effect. Victor Senapaty, founder of the education financier Propelld, explains that the same tuition and living costs now demand significantly more rupees. "The same hundred thousand dollars suddenly becomes much more expensive in rupee terms," he said. For context, the average education loan size for studying in the US from non-bank lenders is around ₹40 lakh, a sum that has effectively ballooned overnight.
The situation is particularly acute for prestigious programs. An annual cost for a four-year undergraduate degree at certain Ivy League institutions can range between $55,000 and $100,000. This rupee depreciation transforms those already steep figures into a much heavier burden for Indian families.
A Double Blow for Returning Graduates
The crisis is not limited to prospective students. It compounds the difficulties for recent graduates who have returned to India amidst a global employment squeeze, often without securing a job abroad. These individuals now face loan repayments that are costlier than they had budgeted for.
"This is especially for the batch of 2022-2023, many of whom have graduated and are working from India," said Ankit Mehra, CEO of GyanDhan. "Their loan payment would have started and now they have to repay a higher than factored amount." This creates a precarious scenario where they earn in a weakening rupee but must service debt in strengthening dollars.
Visa Woes and Shifting Destinations
The currency turmoil adds another layer of complexity to an already challenging year for US-bound students. Increased scrutiny of visa approvals by the US government in 2025 had already unnerved many Indian parents. This led to a significant 25-50% drop in applications for education loans for the US in the first half of the year.
The result was a shift in plans, with many students deferring their courses by a semester or opting for alternative destinations like the UK, Canada, and Australia. Government data presented in Parliament shows the volatility: while Indian students abroad numbered 892,000 in 2023, the figure dipped to 759,000 in 2024 due to geopolitical crises and visa curbs.
Dollar Loans: A Risky Hedge?
In this climate, financial advisors are highlighting a critical decision point: the currency of the loan. Sonal Kapoor of Prodigy Finance notes that students who may eventually earn in dollars could find relief by taking loans in the same currency. "The depreciation of the INR can actually be beneficial for international students, especially those who are working," she said, as their families back home get more rupees for every dollar remitted.
However, this strategy carries substantial risk. Victor Senapaty cautions that it becomes an "all-or-nothing game" hinging on securing overseas employment. "If they don’t get a job and return to India, they’re in trouble because they’re earning in INR but repaying in USD while the rupee keeps weakening. That’s the worst combo," he warned.
The overarching message for Indian students is one of heightened financial vigilance. As the rupee's value fluctuates, careful planning around funding sources, loan currency, and realistic post-graduation employment prospects has become more crucial than ever.
