Barclays: H-1B Fee Hike Likely Keeps Remittance Under $5B

A new research note by Barclays says India’s money inflows from overseas workers are set to weather the latest shake-up to the U.S. H-1B visa program, even as costs and hiring plans for Indian tech firms shift sharply. The bank estimates the hit to India’s annual remittances will likely stay below $5 billion—a slice of an estimated $83 billion total—despite changes announced by President Trump in September 2025 that add a one-time $100,000 fee for new H-1B applications and switch selection from a lottery to a wage-based system. While fewer new visas and a tilt toward higher-paid roles could slow the pipeline for Indian engineers, Barclays argues the broader remittance base, rising offshore work, and new job markets will buffer the blow.

What changed in the H-1B rules

The U.S. administration’s move marks one of the sharpest shifts to the H-1B rules in years, raising upfront costs for employers and potentially reshaping who gets selected. The wage-based system favors jobs that pay more—often senior or niche roles—over entry-level positions that many fresh graduates and early-career engineers have filled.

For Indian families who depend on money sent home each month, the worry is simple: fewer H-1B approvals may mean fewer overseas paychecks and, in turn, lower remittances to meet household needs, pay school fees, and support parents. Barclays’ outlook, though cautious, suggests the remittance channel remains diverse and resilient enough to absorb much of the shock.

Why Barclays expects remittances to hold up

According to Barclays, the reasons are straightforward:

• Remittances are geographically diverse. India’s remittances do not come only from the United States or only from H-1B holders. Skilled and semi-skilled workers across the Gulf, Europe, and East Asia send money home regularly.
• Offshore capacity is large and growing. India’s tech and services industries have built deep offshore capacity. Global Capability Centers (GCCs) run by U.S. multinationals continue to grow, offering high-quality jobs in engineering, product, research, cyber, and finance.
• Work can shift offshore. As onsite staffing in the United States gets tighter or pricier, companies often move roles into India-based teams, maintaining income for professionals who might otherwise have aimed for H-1B placements.

Effects of a wage-based selection system

The change in selection design matters in a subtler way. A wage-based system could favor specialists with higher pay, who often send larger absolute amounts home even if they represent fewer total people. That may limit the drop in total remittance dollars.

Remote and hybrid work models—standard since the pandemic—also help. VisaVerge.com reports that Indian IT providers and U.S. clients increasingly rely on blended teams split between India and onsite staff, with careful planning around roles that truly need presence in the United States. This shift cushions families from sudden income loss tied to visa outcomes.

The $100,000 fee: a serious cost shock

Still, the new $100,000 one-time fee is a major shock to the H-1B pipeline:

• Indian IT services firms (TCS, Infosys, Wipro, etc.) built part of their growth on predictable access to H-1B workers.
• With the fee set this high, companies are likely to:
  • File far fewer new petitions,
  • Reserve petitions for high-impact roles,
  • Replace planned H-1B slots with local U.S. hires.
• Some firms may shift work to other delivery hubs—India, Poland, Romania, Mexico, or the Philippines—creating a broader footprint that limits exposure to U.S. visa risk.

Moving tasks offshore helps maintain income for India-based teams, which in turn sustains household remittances from salaries earned at home but linked to global contracts.

Migration redistribution and other destinations

Barclays notes a key safety valve: migration flows are changing. Canada 🇨🇦 and Germany have become magnets for high-skilled Indian workers due to clearer routes to permanent residence, shorter processing times in some categories, and employer demand in tech, healthcare, and advanced manufacturing.

• If fewer early-career engineers head to the United States on H-1B, some will:
  • Pursue study-work paths in Canada or Germany,
  • Switch to intra-company transfers in Europe.
• This redistribution shifts where remittances come from without cutting them to zero, softening the net effect on India’s inflows.

Human and economic impacts acknowledged

The Barclays estimate—losses likely below $5 billion—does not ignore the human cost. Job plans will change and families may need to adjust. Companies with long-term U.S. client contracts will reprice and rebalance teams to manage the new fee and the wage-based selection rule.

Barclays’ core message: India’s income from overseas workers is broad enough—and the services export engine strong enough—that a steep collapse is unlikely. Pain is real, but not system-breaking.

Downside risks Barclays highlights

Risks that could push outcomes worse than the baseline include:

• U.S. firms cutting more jobs than expected or freezing cross-border hiring.
• GCCs and offshore units being unable to absorb displaced workers quickly enough.
• Younger migrants remitting a smaller share of income than older cohorts, reducing remittance intensity.
• A weakening rupee or rising domestic inflation eroding household purchasing power even if dollar remittances hold.

Policy and business responses that matter

Policy responses can reduce harm. Barclays suggests:

• Speed targeted reskilling and support placements in GCCs and high-growth sectors (product engineering, cloud infrastructure, AI safety testing, semiconductor design, fintech risk, cyber defense).
• Create quick matching between displaced onsite staff and domestic or third-country roles.
• Broaden India’s export basket—legal, design, health-tech back offices, specialized consulting—to reduce sensitivity to any single visa category.

Companies should adapt staffing and contracting:

1. Build clear role tiers: onsite, hybrid, offshore.
2. Reserve H-1B filings for roles with measurable onsite value.
3. Deepen GCC leadership tracks and internal marketplaces to redeploy talent quickly.
4. Reprice contracts to emphasize outcomes, not onsite headcount.
5. Treat onsite time as a premium add-on where appropriate.

Practical advice for individual workers

If you are an early-career professional or planning for H-1B:

• Build transferable skills: cloud architecture, platform SRE, data security, AI model evaluation, embedded systems, domain-heavy roles (banking, insurance, healthcare).
• Keep a savings buffer of at least six months of expenses.
• Consider alternate routes: Canada’s postgraduate work permits, Germany’s Blue Card, intra-company transfers.
• If already in the U.S., monitor status windows, discuss role redesign with your manager, and line up remote-friendly options.

Keep a current record of skills, certifications, and projects. Broaden your network across India-based and overseas teams. Monitor visa timelines and employer communications closely.

Timeline and compliance

The new rules, effective September 21, 2025, change cost structure and selection logic. Employers who still intend to sponsor should:

• Build budgets and hiring calendars around the $100,000 filing cost.
• Expect the wage-based system to favor higher salary levels and experienced professionals.
• Prepare stronger documentation to support higher wages and specialized duties.

For an overview of H-1B basics—specialty occupation standard and employer obligations—see the official guide on the USCIS H-1B program page.

How services trade evolution cushions the shock

Barclays draws on structural changes in services trade:

• Core engineering, QA, product operations, and parts of consulting now run from India with secure networks, shared tools, and follow-the-sun workflows.
• A cut in new H-1B approvals does not automatically equal a cut in project volume if roles move offshore instead of disappearing.
• Some income paid in India won’t count as remittances in official tallies, but household impacts can be similar if take-home pay remains steady.

Remittance profile changes to watch

A wage-based selection likely changes the profile of who sends money home:

• Higher earners may remit more dollars per person but may also settle longer in the U.S. and spend locally.
• Early-career workers sometimes remit a larger share of income even if their pay is lower.

Barclays lists “remittance intensity” as a risk factor—if the remittance share falls, total flows could dip more than headcounts suggest. Even so, Barclays expects the drop to be contained within the under $5 billion range.

Geopolitical and macro considerations

A broader policy escalation—trade measures or further visa limits—could slow cross-border investment and capital movement, denting remittances and other inflows like foreign direct investment.

India’s Finance Ministry says it is watching the situation and views current risks as manageable, given strong services exports and a wide base of remittance sources. Steady diplomacy and industry outreach can help keep talent mobility channels open.

On-the-ground examples

• A mid-level developer in Hyderabad may move into a GCC role with a global retailer or fintech instead of a U.S. posting.
• A cloud architect in Pune might lead a hybrid team from India and travel only for quarterly reviews.
• A data engineer in Bengaluru could redirect overseas plans to Toronto or Berlin.

Income continues in many cases, but the route changes—spreading risk across more career paths and delivery hubs.

Employer playbook (practical steps)

Employers can lessen the shock by:

• Building clear role tiers (onsite/hybrid/offshore).
• Reserving H-1B filings for demonstrable onsite value.
• Deepening GCC leadership and internal marketplaces.
• Sharing transparent timelines to help employees plan.

Final takeaways and recommendations

• Treat the United States as one option, not the only one. Build skills that travel well.
• Budget for the $100,000 one-time filing cost if a U.S. onsite role is truly essential.
• Use the wage-based system’s signals to align roles with compensation and business value.
• Invest in offshore excellence where it makes sense and keep people at the center of planning.

The remittance shock is real but likely limited. Barclays’ central view: expect pressure, prepare smartly, and India’s remittance line should hold nearer the bank’s under $5 billion loss scenario rather than a worst-case collapse.

For formal guidance, review the USCIS H-1B program page. According to VisaVerge.com, clear employer communication, careful petition planning, and early redeployment strategies will decide which firms keep projects on track and which face avoidable disruption.