Lounge access at airports feels like one of those luxuries, too: comfortable seating, free food, Wi-Fi, and an escape to a peaceful refuge from crowded terminals. Most premium credit cards in India boast about "free" lounge access as one of its unique selling points. But is this really free access, or is the cost merely disguised in the fine print?
Credit cards such as HDFC Regalia Gold, ICICI Sapphiro, and Axis Bank Vistara Infinite offer free visits to lounges in airports through a reward. For example, HDFC Regalia Gold offers 12 annual complimentary visits to domestic and international airport lounges to its customers, while ICICI Sapphiro provides free access to 450 airport lounges across 115 countries around the world. Sounds pretty fantastic, but the true cost of such privileges often lies outside the lounge.
Hidden Costs: What You’re Really Paying
1. Annual Fees
Most cards with lounge access come with steep annual fees attached. HDFC Regalia at Rs 2,500 plus GST annually must be compared with Axis Bank Vistara Infinite at Rs 10,000. Those fees are justified by perks like lounge access, but when you don't make use of the other benefits you receive through the card, then you get overcharged for a perk that you rarely use.
2. High Minimum Spends
To waive these annual fees, banks often charge very high spending thresholds. For example, ICICI Sapphiro requires spending of Rs 5 lakh annually on domestic purchases to waive the Rs 3,500 annual fee. For someone with lower spending needs, this requirement may incur unnecessary expenses purely to keep the card "free".
3. Markup fees on International Transaction
International lounge access does sound great, but most of these cards hit you with a markup fee of 3-3.5 per cent on foreign currency transactions. So, if you're using your card abroad to meet spending thresholds, it could end up costing you more in fees than the lounge visit itself is worth.
4. Fewer Free Visits
The "free" access is usually capped. For example, the SBI Elite Card offers only six free international lounge visits a year (two per quarter) and two complimentary domestic lounges visit every quarter with each subsequent visit costing extra. Frequent flyers might exhaust their free visits early on and thereby incur costs they did not expect to incur.
5. Cross-Subsidized Costs
Banks recoup the expense of lounge benefits indirectly in the form of higher interest rates on outstanding dues. An example of a credit card offering lounge access lists an annual interest rate of 40 to 53 per cent. One delayed payment and the "free" benefit can be prohibitively expensive.
Financial costs apart, lounge access can attract customers to spend money. Comfort and exclusivity could encourage travellers who may be willing to justify the higher card fees or splurge on premium services they do not need.
Other kinds of travel perks include lounge access cards that, on occasion, may not bring full value in relation to other rewards like accumulated points or travel insurance if not utilized. One of the alternatives is independent lounge passes like Priority Pass, offering more lounge entries at a lesser price. You are not obligated to high-fee credit cards.
While it may be perceived as a really luxurious free perk, the actual cost is usually hidden in annual fees, spending thresholds, or interest charges. To truly maximize such benefits, card usage patterns and financial goals must be carefully assessed first. Otherwise, you might end up paying more for what you gain in "free" airport lounge access—often without knowing so.
