Thomas Cook partners with State Bank of India to offer savings holiday plan to bank's customers

MUMBAI: Banking on the burgeoning middle class and their growing travel needs, travel major Thomas Cook India has partnered with State Bank of India (SBI) to offer savings holiday account to the bank's customers.

Through Thomas Cook Holiday Savings Account ( HSA), SBI's online banking customers will be able to pre-select a holiday from Thomas Cook and save for it through recurring deposit with the bank.

Travel firms have come up with innovative plans that allow people to save money for big-ticket vacations. Under these savings holiday plans, customers choose the destination and save money for 12 months with the travel company's banking partner under a recurring deposit account. The 13th installment is a combination of the interest accrued from the recurring deposit and a top-up as a discount put in by the travel company.

Through this scheme, customer's will be offered inflation proof holiday as they pay for a future holiday with at current prices, while also earning interest linked to the e-recurring deposit.

"We find that people don't plan their holidays in advance and end up taking last minute loans to finance the same. Also, they could have saved on the cost of the holiday had they booked early," Rajnish Kumar, managing director (National Banking Group), SBI said in a statement.

The Thomas Cook holidays offered are all inclusive packages for domestic and international tours. The scheme also allows a customer to opt out of the holiday package at any stage at zero cost.

One of the main advantages of such a plan is that the holiday package is booked at the rate prevailing when the customer starts depositing money. Even if the air fare and hotel tariff have risen by the time the RD matures, the customer will not have to pay at the higher rates, bringing down the uncertainty on air and hotel tariffs.

"The unbeatable advantage of paying for a future holiday at today's prices, ensures SBI's customers a powerful proposition of an inflation-proof holiday while enjoying attractive interest rates, a zero exit clause and a free top up from Thomas Cook on the 13th month," Madhavan Menon, chairman and managing director, Thomas Cook India said in a statement.

Experts said the savings holiday scheme is best suited for people who opt for personalised international holidays. In India, this category is increasingly seeing ready takers in tier-2 and tier-3 towns.