Skyrocketing School Fees: A Major Concern for Indian Families

Skyrocketing school fees have become a pressing issue for families in India, as highlighted by Rajat Bhardwaj, Co-founder of CoinSwitch. He pointed out that education has transformed into the largest financial burden for many families, compelling parents to opt for EMIs even for nursery education. In a recent LinkedIn post, Bhardwaj portrayed the harsh realities faced by middle-class families as school costs continue to rise disproportionately compared to their incomes.

Concerns About Rising Fees

Bhardwaj expressed his concerns with alarming statistics: “30% fee hike. If this isn’t theft, what is?” He initiated discussions regarding educational expenses for his daughter and was taken aback by the increasing costs. In Bangalore, parents are now required to pay ₹2.1 lakh for a third standard education, and this is not for an international institution, but a standard CBSE school. A parent even pointed out that the ₹2 lakh fee for Class 3 is more than the cost of an engineering degree.

Annual Fee Increases

Additionally, Bhardwaj noted that this is not an isolated incident, as fee hikes of 10-30% occur yearly. In contrast, middle-class salary growth has only seen a measly 0.4% CAGR over the past ten years. Education expenses now account for 19% of total household income, with annual school costs for Class 4 in Ahmedabad reaching ₹1.8 lakh. Parents are now facing the dilemma of saving for college amidst the reality of taking EMIs for nursery fees.

The True Cost of Education

Despite official data claiming an education inflation rate of merely 4%, the reality tells a different story. Bhardwaj pointed out the dissonance faced by parents, stating, “try telling that to the mom comparing 5 school brochures or the dad calculating basic expenses.” The situation is not just a matter of inflation; it represents a significant erosion of savings and family aspirations. The notion that “education is the great equalizer” is now overshadowed by the reality that it has become the greatest monthly liability for families.

Appeal to Fintech Community

Bhardwaj made a direct appeal to builders, founders, and policymakers in fintech, urging them to understand their users—parents who are silently struggling, making sacrifices yet striving to provide for their children. He encouraged innovation to help these families find ways to succeed.

Responses from the Community

The post elicited many responses from internet users sharing their experiences. One user suggested that homeschooling could be a viable alternative, arguing that schools are exploiting parents due to the lack of alternatives. They emphasized the need to address the core issues in government school education, which has fueled the private school boom.

Another user shared their experience, stating, “I can show you the actual fee receipts for my daughter from 1st, 2nd, and her current 3rd standard.” They expressed frustration at the exorbitant fees charged by even average schools, indicating that prestigious institutions naturally demand more.

A third user echoed the sentiment advocating for homeschooling, arguing that the education value does not justify the high fees and donations demanded, while parents exhaust themselves ensuring their children meet academic standards. They concluded that homeschooling might offer a better solution, free from the burden of exorbitant fees.