Ola, Uber fees may be capped at 10% of total fare

BENGALURU: The central government plans to cap the commission earned on rides by firms such as Uber and Ola to a maximum of 10% of the total fare in its upcoming rules for taxi aggregators, people privy to the matter said.This is the first time the government is looking to regulate the commission collected by such firms, which currently stands at about 20%.Further, state governments, if they choose to, could also levy a charge on the aggregators’ earnings, according to the guidelines shared with state officials that ET has reviewed.“We are planning to release the draft (aggregator rules) for public feedback sometime next week,” said a senior official from the road transport and highways ministry that formulated the guidelines shared with the states last month. “It will largely be in line with the guidelines that were shared, with a few small changes.”On the contentious issue of surge pricing, the government has suggested capping it to a maximum of twice the base fare. The base fare can be fixed by the state, or suggested by the aggregator and revised every quarter.Rules may be in place by year-endHowever, there is a follow-on clause stipulating that no more than 10% of daily rides undertaken by a driver can be subject to surge pricing.ET first reported on the proposal to cap the surge pricing at thrice the base fare in its September 13 edition.The final rules for cab aggregators, which will be notified under the Motor Vehicle Act, 2019 that came into force on September 1, is likely to be formalised before the end of the year.The guiding document detailed the fee caps, apart from regulations on surge pricing, passenger and driver safety, penalties for drivers and aggregators, and licencing norms for aggregators.Tackling the other big issue of drivers cancelling rides, the guidelines suggest a penalty in the range of 10-50% of the total fare not exceeding Rs 100. Further, states will be able to set a maximum number of cancellations a driver can make in a week, before being off-boarded by the aggregator for a period of two days. A similar penalty of 10-50% of the total fare not exceeding Rs 100 could be levied on passengers cancelling a ride for no reason.72269146 On the safety front, the government could mandate an insurance cover of Rs 5 lakh for each rider, the guidelines said. Aggregators will also have to verify a driver either through facial recognition or biometrics once every three hours to ensure that the driver undertaking the trip is the same as the person enlisted with the aggregator.“Ride-hailing is one of the best solutions for India. One cab replaces 10 personal cars on the road and 35% of personal car trips at any given point remain idle,” one of the senior officials said. “This is what causes congestion.”He added that the rules were in line with promoting ride-hailing in the country, while also protecting driver and rider interests. The guidelines suggest that states should allow city taxi permit holders to also get attached to aggregator apps. Further, state governments should ensure that public parking spaces be allocated to cabs attached to ride-hailing companies. “Municipalities need to recognise that this (ride-hailing) is something good for the country. Unfortunately we have been facilitating only the sale of private vehicles through our policies,” added the official.

from Economic Times https://ift.tt/37GvROi