Indian students get a reprieve from the $100,000 H-1B hurdle

For many Indian students who plan to pursue bachelor’s or master’s programmes in the United States or are already pursuing them, the H-1B visa has long been a bridge between a campus degree and the first chapter of their professional lives. The recent clarification from the US Citizenship and Immigration Services (USCIS) is therefore a major relief.

It confirms that the extra $100,000 payment announced by presidential proclamation does not apply to students and recent graduates who are already in the US, as well as those who are set to obtain H-1B status by changing from F-1 to H-1B within the country.

“This clarification is exactly what we have been advocating,” said Aman Singh, Co-founder of GradRight. “The proposed $100,000 H-1B fee was never meant to hinder genuine talent, and the official clarification reinforces that message.”

That reassurance matters for students on OPT and STEM OPT, and for the employers who hire them.

OPT is the employment authorisation that lets students on an F-1 visa work after graduation. The standard period for OPT is 12 months. Students who graduate in eligible STEM subjects may apply for a further 24-month extension, thus gaining a total of up to 36 months of practical training.

How the rule evolved 

The presidential proclamation was announced on September 19 and took effect for petitions filed on or after September 21.USCIS published updated guidance on October 20 to explain how the fee will be applied. 

The agency said the fee targets new H-1B petitions for beneficiaries who are outside the US, and for cases that request consular notification, port of entry notification, or pre-flight inspection.

Crucially, USCIS confirmed that petitions filed from inside the US to request a change of status from F-1 to H-1B are not subject to the $100,000 payment.

This clarification removes a large financial obstacle for students on F-1 and for those working on OPT or STEM OPT. 

Many employers sponsor recent graduates by filing a change of status petition while the graduate remains in the US. Those in-country transitions will not trigger the new payment. Students on STEM OPT can continue authorised employment while a petition is adjudicated, which preserves the common path from degree to job for many technology and engineering graduates.

“The USCIS clarification brings much-needed assurance for Indian students already in the US,” said Sonal Kapoor, Global Chief Business Officer at Prodigy Finance, an international student loan provider. “It confirms that OPT and STEM OPT remain reliable pathways from study to work, helping students plan their next steps with confidence while keeping them attractive to employers.”

“This update also restores confidence for students planning to study in the US, particularly in STEM fields,” Kapoor added. “It signals that the US continues to value international talent and reassures those who have been eagerly preparing for their studies and careers.”

Employers, hiring patterns

Employers that recruit from Indian campuses or from the domestic talent pool can continue to rely on in-country change of status filings for existing students and recent graduates. That reduces immediate cost pressure on startups and smaller firms that hire entry-level technical staff.

“Employers save the surcharge by recruiting talent already trained and resident in the US, as the new fee does not apply for F-1 to H-1B transfers,” observed Singh. “Instead of reducing jobs, the policy could actually expand opportunities for Indian students who study in high-demand fields such as technology, data science, and engineering.”

Employers must, however, confirm the requested action on each petition. A petition that requests consular processing is treated differently and may still be subject to the new fee.

There is a clear procedural distinction that students must understand: Change of status means the beneficiary remains in the US while the petition is processed and then automatically takes H-1B status on the approval date. 

Meanwhile, consular processing means the individual must obtain an H-1B visa stamp at a US consulate abroad and re-enter the US to activate H-1B status. Under the proclamation, consular processing and new entries are the cases that attract the fee. Travelling abroad while a petition is pending can therefore expose a student to the new charge.

Offshore transfers still pay the price

The proclamation retains a heavy impact on employers that bring workers from overseas for the first time. Indian IT and consulting companies that regularly transfer staff from India to US client sites will face the $100,000 charge for initial entries and for petitions filed through consular processing.

That makes traditional transfer models materially more expensive, and it may prompt some firms to increase in-country hiring or expand offshore delivery instead.

What lies ahead

The proclamation and the fee have prompted immediate litigation and political debate. Business groups and industry coalitions have filed challenges arguing that the executive branch lacked authority to impose this charge.

Courts may issue injunctions or rulings that alter implementation, and the Department of Homeland Security has also signalled other potential changes, including a proposed weighted selection system for the H-1B cap that would favour higher-wage roles.

Together, these developments create regulatory uncertainty even as USCIS clarifies specific points.

For Indian students in the US, it is important to verify visa status and confirm with the employer and the university’s international office whether the petition will request a change of status or consular processing, and to ensure that this decision is recorded, industry experts said.

They added that students on OPT or STEM OPT should maintain documentation of authorised employment dates and seek advice from a qualified immigration adviser before making any travel plans.

Universities can support this process by hosting clear information sessions with immigration counsel and by providing templates that help students engage with employers about petition strategy.

“Students are increasingly thoughtful about planning, internships, skill-building, and financial decisions,” Kapoor noted. “This clarity around post-study work options helps them map out careers strategically and see their education as the start of a meaningful global trajectory.”

“This is reassuring news for thousands of aspiring Indian students planning their higher education in the USA,” Kapoor added. “The country retains its position as a premier destination for education, innovation, and career growth.”