India’s foreign exchange demand has shifted decisively beyond its largest cities, with tier-2 and tier-3 urban centres together accounting for 53% of total forex demand in the period covered, according to Thomas Cook India’s Forex Report 2026. Tier-2 cities alone contributed 41% of demand, tier-3 cities 12%, and tier-1 cities including metros the remaining 47%, the report said. The data, reported by Business-Today, show that foreign exchange activity is no longer concentrated in the country’s biggest urban hubs.
The report attributed the shift to a broadening base of travel, business and education-related currency needs. Leisure travel accounted for 57% of forex transactions, corporate travel for 27%, and student travel for 16%, according to the same report.
Emerging India is driving the next phase of forex growth, with Tier 2 and Tier 3 cities contributing over half of overall demand.
Leisure travellers and age distribution
According to the report, travellers aged 25–40 formed the largest user group, accounting for 37% of demand, with those aged 41–60 close behind at 36%. Travellers above 60 years represented 21%, and the 18–24 age bracket just 6%.
- 25–40 years: 37% of forex demand
- 41–60 years: 36%
- Above 60 years: 21%
- 18–24 years: 6%
The report stated that "Millennials and Gen X together account for nearly three-fourths of forex usage," and that senior travellers continued to make an important contribution to outbound forex demand.
Currency mix: US dollar leads
The US dollar remained the most sought-after currency, accounting for 49% of overall forex demand, according to the report. European currencies — the euro and British pound — collectively made up 23%, while Asian currencies including the Thai baht, Singapore dollar, Japanese yen, Vietnamese dong and Indonesian rupiah accounted for 11%. The UAE dirham and Saudi riyal led Middle Eastern currencies, which formed 9% of demand, with Australian and New Zealand currencies at 5% and the Canadian dollar at 3%.
| Currency segment | Share of forex demand |
|---|---|
| US dollar | 49% |
| Euro & British pound | 23% |
| Asian currencies (Thai baht, Singapore dollar, Japanese yen, Vietnamese dong, Indonesian rupiah) | 11% |
| Middle East (UAE dirham, Saudi riyal) | 9% |
| Australian & New Zealand currencies | 5% |
| Canadian dollar | 3% |
Digital channel growth
Branch-assisted transactions remained the preferred channel for forex purchases, accounting for 75% of purchases, with digital channels making up the remaining 25%, the report said. Digital forex adoption across Thomas Cook India’s channels increased 25% year-on-year, while usage of DIY platforms rose 50% year-on-year over the last two years. According to the report, this reflected a gradual move towards digital-first forex transactions among Indian travellers.
Implications for corporate treasuries
For finance executives and treasury professionals, the report’s purpose-mix data show that corporate travel accounts for 27% of forex transactions, a segment directly relevant to businesses with international operations. The currency distribution, led by the US dollar at 49%, highlights the currency pairs most active in Indian forex demand. The rising use of digital channels and DIY platforms — with adoption up 25% and 50% year-on-year respectively across Thomas Cook India’s channels — points to a broader digitalisation trend in how Indian forex demand is transacted, according to the report.
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