DreamFolks Suspends Domestic Airport Lounge Access in India After Major Contract Losses: What Travellers and Investors Need to Know

DreamFolks, India’s leading airport lounge aggregator, has announced the suspension of its domestic lounge access services with immediate effect. This strategic move comes after a series of high-profile contract losses and marks a turning point for airport lounge access in India, impacting both frequent travelers and the broader travel industry. Here’s a deep dive into what sparked this decision, the reasons behind it, potential consequences, and what it means for travelers and stakeholders.

What Happened: The DreamFolks Announcement

DreamFolks Services Limited announced its exit from the domestic airport lounge market in India on September 16, 2025. This discontinuation is described by the company as “material in nature,” emphasizing its significance to the business. The decision follows several clients and lounge operators terminating longstanding agreements with DreamFolks. Among these were Adani Digital, Semolina Kitchens, and Encalm Hospitality—major players in India’s airport infrastructure.

Why Did DreamFolks Quit the Indian Domestic Lounge Market?

The primary catalyst behind this move is a dramatic shift in the way airport lounges are accessed. Traditionally, DreamFolks operated as an intermediary, partnering with banks and credit card companies to enable their customers to access airport lounges. However, many airports and their operators—including Adani Airports and GMR—have now shifted to a direct-to-consumer model, letting banks tie up with lounge operators directly and eliminating the need for aggregators.

Airport operator Adani Airports has cited the rise of fintech and digital platforms as a key factor, stating that technological advances have rendered traditional middlemen redundant. This industry shift put pressure on DreamFolks’ commercial relationships, as highlighted by the company itself.

Market Impact and Share Price Reaction

DreamFolks’ share price reflected the severity of the announcement, plummeting about 65% in 2025 and accelerating the company’s stock market losses. While the price ticked slightly up to ₹138.58 after the exit was made public, overall investor sentiment remains negative, with the stock down over 73% year-on-year. This underlines market concerns about DreamFolks’ future prospects now that its core business segment is gone.

What Still Continues? International Operations and Domestic Add-Ons

Despite the suspension of domestic lounge access, DreamFolks says its international offerings and other domestic value-added services are still available. The company is also in ongoing discussions with clients and partners to develop alternative value propositions and maintain its existing contractual obligations where possible.

Industry Implications: What This Means for Travelers and Banks

The biggest immediate outcome is that Indian bank cardholders who depended on DreamFolks for domestic airport lounge access will now have to look for alternate options. Banks and card issuers must establish new tie-ups—either directly with airport lounge operators or with other aggregators if any remain.

• Indian travellers may experience disruptions or reduced access to lounges during the transition.

• Partner banks must quickly adapt to ensure cardholder benefits and satisfaction continue uninterrupted.

• Competing lounge access models may emerge, alongside a potential wave of direct collaborations between banks and airports.

Why This Change is “Material” for DreamFolks

The domestic airport lounge segment was a significant revenue driver for DreamFolks, accounting for a large share of its business volume. With the loss of top clients and airport operators, DreamFolks’ income streams are likely to be severely impacted until a new business model is solidified.

DreamFolks’ Response and the Road Ahead

DreamFolks has reassured stakeholders that it remains committed to serving international travelers and fulfilling domestic agreements not related to lounge access. The company is actively strategising to create new value for clients and to pivot its operations in response to the evolving landscape.

“Pressure from airport operators expanding into the lounge business is weighing heavily on our commercial relationships. We’re actively discussing paths forward with our clients,” stated a DreamFolks official.

The Future of Lounge Access in India

This development marks a major milestone in the Indian travel industry and highlights how digital transformation is upending traditional business models. For DreamFolks, the challenge now is to reorient its services and remain competitive in a rapidly changing travel landscape. For travelers, banks, and airports, it ushers in a period of transition with new opportunities—and potential disruptions—in the way lounge access and travel perks are delivered.

Travelers, cardholders, and investors should keep an eye on future updates from DreamFolks as the company navigates its next chapter in India’s dynamic aviation space.