Bengaluru residents and auto drivers bear brunt of commission and licence issues of Ola, Uber and Rapido

Twenty-nine-year-old Shreyas KP, who lives in the Vasanthnagar area in Bengaluru, is a regular user of app-based services like Ola and Uber and usually takes an auto to make the 5 km trip to his workplace. However, for the past few days, Shreyas says it’s been difficult to find a ride.

This development comes in the wake of the state government first banning such services and then the Karnataka High Court allowing them to resume subject to a price cap.

“It was like a routine for me: get ready, book an auto, leave. This is disrupted now. I’m hailing autos from the road but I stay in a place where I don’t see many autos around,” Shreyas said.

Many other Bengaluru residents who use app-based autos on a regular basis highlighted similar issues and more such as increased waiting time, non-acceptance of online payments, cancellation requests and extra cash above the estimated ride charge.

Gayathri, who relies on autos from aggregators to get to and from work each day and gave only her first name, said regular policy flip-flops have led to increased wait times.

“It takes me 20 minutes, and sometimes even longer to hail an auto. I’m often delayed or struggle to get to meetings on time since getting an auto on time is a hassle, and there is no reliable mode of public transportation between my home and office.” Sometimes, cancellations add to the delay as well, she added.

While Ola and Uber have reduced prices post the state government’s intervention, residents complain that it is of no use when the rides are not available or drivers are not accepting the ride at that price.

“When I saw the revised prices, I was happy and felt good that we will spend a little less, but what’s the point if we don’t get any rides for that price? Autos I hail from the street don’t use meters these days,” said Karthik S, a resident of Banashankari.

At the heart of all this is the ongoing wrangling over commission charges and licences of app-based auto aggregators Ola, Uber and Rapido with Karnataka’s transport department.

The commission includes a convenience fee, which is charged to the passengers for doorstep pick-up. While the Karnataka High Court fixed a temporary rate of 10 percent over and above the ride cost, after several meetings with various stakeholders the Karnataka government proposed it to be set at 5 percent.

Aggregators say business is unviable

In the last three to four months, Uber Auto has been able to fulfil only one out of four requests from riders, showed data sourced from the company.

“One out of six Uber auto driver partners have moved out of the platform to street hail and there has been a 3X increase in rider complaints about auto drivers forcing riders to take offline trips at higher than metered fare impacting rider experience,” said an Uber spokesperson, replying to Moneycontrol’s queries.

App-based auto aggregators say that lower commission makes business unviable for them.

“Any commission constraints should be financially sustainable to run operations. If our costs cannot be covered through commissions, we will have to find ways to offload costs that could impact the experience of drivers and riders,” an Uber spokesperson said.

Confused drivers look for alternatives 

Over 10 drivers Moneycontrol spoke to said that they have quit Ola, Uber and Rapido and are looking for alternatives.

The most prominent of these alternatives is the Namma Yatri app from the Autorickshaw Driver Union (ARDU) developed in partnership with the Nandan Nilekani-backed Beckn Foundation.

“I have shifted to Namma Yatri but mostly get passengers from the street. We hardly get any money through Ola or Uber these days. When we compare how much we earn with the rising cost of fuel, it’s not worth it,” said Usman, a 39-year-old auto driver.

The trouble with online payments 

“I use Uber or Ola to find passengers but I don’t accept online payment. We are not getting our online payment properly. My friends have shifted to the Namma Yatri app,” said auto driver Arun Kumar, 32.

However, there are still a few teething troubles with the app. Kumar says that he doesn’t find Namma Yatri very user-friendly.

“I also want to shift but it’s a little difficult to use the app, I feel. I tried but I couldn’t find passengers and when a passenger cancelled a ride I didn’t even get a notification for that,” he said, adding that the app is still in the developmental stage and has room for improvement.

Tanveer Pasha, president of the Ola Uber Drivers’ and Owners’ Association, states that driver earnings haven’t changed significantly since the changed prices came into effect as the surcharges levied went to the companies instead of the drivers.

The road ahead 

While the Namma Yatri app developed by ARDU and the Rook app by the Peace Auto Union are up and running, many riders and auto drivers are yet to tap into them.

Union representatives say that while some drivers have signed up for apps like Namma Yatri, most are on multiple legacy apps as the new apps do not have significant traffic yet. On Namma Yatri, for instance, drivers say they typically get about five rides a day.

In fact, an independent mobility expert Moneycontrol spoke to said that while Ola, Uber and Rapido should also join hands with Namma Yatri which will be like an “ONDC moment for mobility”, there needs to be uniformity between the state and central government’s aggregator norms.

“It is prudent, equitable, and fair to adopt the central government’s Motor Vehicle Aggregator Guidelines, 2020, which has proposed that at least 80 percent of the fare applicable on each ride is given to drivers and the remaining charges shall be with the aggregator,” said Satya Arikutharam.

“We are seeking appropriate fare regulations that account for both the unique value proposition of autos that provide doorstep pick-ups and additional services provided by platforms like Uber. The current fixed metered fare does not adequately compensate drivers for the additional distance travelled and time spent in picking up a passenger from their doorstep,” said an Uber spokesperson.

The commission charge tussle with the state government is now in the hands of the Karnataka High Court and the hearing is scheduled for December 12.

Apart from the commission issues, the Karnataka State Transport Authority early this week refused to renew cab aggregator licences of Ola and Uber as they had not complied with rules like installation of GPS devices.

Ola’s licence expired on June 19, 2021, and Uber’s on December 30, 2021. However, both companies reapplied for their licences. In the recent meeting, both companies were given 45 days to first comply with the government’s rules and guidelines.