Whalesbook
The shift in airport lounge access for credit cards signals a strategic move by banks, driven by rising costs and a desire to refine customer rewards. As domestic lounge visits can cost around ₹800 and overcrowding diminishes value, card issuers are redesigning benefits to reward higher spenders with more exclusive travel experiences.
The Strategy Behind the Change
The widespread popularity of airport lounge access, once a coveted feature on entry-level and mid-tier credit cards, has led to overcrowding. This has prompted a shift, making lounge access increasingly conditional. Banks are moving away from offering it as a universal benefit, linking it instead to customer spending.
From July 1, 2025, Axis Bank customers will no longer access lounges through Dreamfolks. They will partner with Priority Pass for international lounges and end complimentary access on cards like the Airtel Axis Bank Credit Card from April 12, 2026. HDFC Bank and ICICI Bank have also introduced strict quarterly spending requirements, such as ₹60,000 and ₹75,000 respectively, to qualify for visits. This approach divides the market, rewarding high spenders while managing costs.
The travel rewards credit card market is projected to reach $214.11 billion by 2026, showing ongoing demand for travel perks, though delivery methods are changing. Major banks like HDFC Bank (approx. $130 billion market cap as of April 2026) and ICICI Bank (approx. $100 billion) are leading these changes.
Key Bank Moves and Market Data
Major Indian banks are taking different approaches to this change. SBI Card, for instance, is dividing its domestic lounge access program from January 10, 2026, into Set A for premium cards and Set B for Prime and Platinum cards. They are also introducing a small verification fee (₹2 for Visa/RuPay, ₹25 for Mastercard). This follows the trend of offering different benefits by card tier.
While top-tier cards like the HDFC Infinia or Axis Bank Reserve Card continue to provide unlimited access via Priority Pass for select clientele, mid-tier cards have stricter limits or spending requirements. For example, the SBI Prime card offers 8 domestic and 4 international visits annually.
The industry is seeing higher annual fees for premium cards and more 'coupon book' style statement credits, a trend expected to continue into 2026. Banks are also improving their own travel booking sites, encouraging direct bookings over third-party platforms to create a unified customer experience.
The financial standing of key banks is strong, with HDFC Bank showing a P/E ratio around 15.99 and ICICI Bank around 17.36 as of April 2026, indicating stable valuations despite strategic shifts.
Risks and Consumer Impact
Stricter lounge access rules pose risks for both cardholders and banks. For consumers, the growing complexity of eligibility rules, requiring cardholders to track quarterly spending closely, can be frustrating. If spending thresholds aren't met, benefits don't activate, causing confusion and making the card seem less valuable.
This fragmented approach, like a 'coupon book' where many benefits need careful management, can reduce the card's overall appeal. Card issuers face the challenge of upsetting some customers if the changes feel like a loss of value. There's also a potential competitive disadvantage if rivals offer easier or more varied travel perks.
The cost for banks, around ₹800 per domestic lounge visit, highlights the economic need for these changes. How banks communicate and implement these changes is key to keeping customers happy and loyal.
Looking Ahead
Banks will likely continue offering lounge access, but its form will keep changing. Expect more segmentation: premium cardholders will get better perks, while other cards will have more restrictions or higher spending requirements.
There will be a greater focus on curated travel packages and integrated digital platforms, moving beyond a single perk to a wider set of travel services. Cardholders should expect more tailored travel benefits and need to understand their card's terms and conditions to get the most value.