One Thursday morning, software engineer Anoop Rao stepped out of his Indiranagar apartment to head to his office near Koramangala. His regular ride-hailing app showed a fare of Rs 210 for the 7-kilometre ride, with an optional tip of around Rs 30. Not cheap, but he needed to be on time. When the trip ended, however, he was surprised to see the final bill at Rs 284.
There it was, buried below the fare breakup, Rs 9 as “congestion charge,” around Rs 20 as “driver addition fee,” and Rs 20 as “pickup fee/charges.” Rao, a regular user of ride-hailing services, had seen prices fluctuate before. But this was new. “Why am I paying to get a driver when that’s the whole point of the app?” she asked.
Rao isn’t alone. Across Bengaluru, daily commuters are grappling with steadily rising fares, thanks to new add-on charges being levied by app-based ride platforms like Rapido, Namma Yatri, Ola and Uber. To be sure, all the ride-hailing platforms collect standard commission from auto drivers to use the platform and not collect any payment through thier apps from users, directly.
Also, read: A week after bike taxi ban, Bengaluru sees spike in traffic jams, costlier auto rides & angry gig workers
These charges come despite a Karnataka High Court order that capped aggregator commissions at 10 percent, aimed at making fares more affordable and transparent.
As per the Karnataka High Court's October 2022 order, app-based auto aggregators are allowed to charge only 10 percent above the government-notified fare, plus 5 percent goods and services tax.
In November 2021, the state fixed the minimum auto fare at Rs 30 for the first 2 km, which makes the app-auto base fare Rs 35.
However, Moneycontrol found that aggregators are charging up to Rs 50-Rs 70 for a minimum fare, and passengers also often need to add a 'tip' before the ride is accepted. "It’s a demand and supply issue. After the bike taxi ban, demand for auto rickshaws has gone up-so have the fares," said a source in one of the aggregators.
While Namma Yatri and Rapido include charges like driver additions, platform fee and congestion charges, Ola and Uber do not provide a breakup.
“Government fare policies guide our pricing structure and reflects factors like distance, time, and pickup effort, ensuring fairness for both sides. Our people-first approach lets commuters and drivers set the final price by allowing optional adjustments to the base fare. We remain open to community feedback and practical solutions to keep pricing fair, affordable and transparent,” Namma Yatri’s spokesperson said in a statement.
Almost every major aggregator, Uber, Ola, Namma Yatri, and Rapido, has introduced “tipping” or “add-on” features to incentivize drivers, especially during peak hours or bad weather.
To make matters worse, the state’s crackdown on bike taxis, a cheaper alternative for solo riders, has left commuters with fewer options and higher bills.
Karnataka’s bike taxi ban came into effect on June 16. Since then, many officegoers who relied on bike taxis have perforce switched to personal vehicles such as two-wheelers and cars, even as auto rickshaw drivers hiked fares amid rising demand.
The additional charges are levied despite Union Consumer Affairs Minister Pralhad Joshi asking the watchdog to look into the practice used by cab aggregators.
Ola, Uber and Rapido did not responded to Moneycontrol’s official queries.
Also, read: Karnataka: Bike taxi riders question why white-board delivery two-wheelers are allowed, but not them
SaaS model is facing a hiccup
This comes as Karnataka’s Authority for Advance Ruling (AAR) has indicated that it may revoke the GST exemption it granted Namma Yatri in September 2023.
The exemption had allowed the open-source auto-hailing platform, operating via a fixed-subscription SaaS model, to avoid collecting 5% GST on rides.
However, after the service was spun off from Juspay and transferred to a new entity, Moving Tech Innovations, the AAR claims there may have been suppression or misrepresentation of facts behind the earlier application.
A hearing on June 27, 2025, will decide whether the original tax relief will be upheld.
The case has raised concerns across the ride-hailing industry, since other platforms like Ola, Uber, and Rapido also use similar subscription-based structures to bypass GST charges. A negative outcome for Namma Yatri could prompt wider scrutiny and policy changes, and eventually charges going up for users.
“We also request the government to consider adding a time component to fare calculations and linking fare revisions to inflation. We believe ride batching and public-transport integration are long-term, sustainable solutions, and we’re actively working on these features in collaboration with government organizations,” Namma Yatri spokesperson said.
Eye on regulation
In October 2022, responding to complaints that minimum auto fares on aggregator platforms were crossing Rs 100, the transport department issued notices to aggregators, instructing them to halt operations and apply for separate three-wheeler licences. The aggregators challenged the directive in the court.
The Karnataka High Court capped fares at 10 percent above the government’s base rate, plus 5 percent GST. This brought the minimum fare to Rs 35.
Bengaluru Central MP PC Mohan too flagged the issue on social media. “Just a 1.5 km auto ride via aggregators now costs over Rs 70 in Bengaluru. Fare regulation has completely collapsed. The state government must fix base fares, enforce meters, and protect commuters from app cartelisation and digital monopolies. Citizens have already lost Rs 1,010 crore due to overcharging.”
“Auto fares in Bengaluru have surged by 50% since the bike-taxi ban. Even short 3 km rides cost Rs 120–Rs 150. Commuters are forced to pay 'tips' of Rs30–Rs 100 to avoid cancellations. With meters defunct and digital monopolies unchecked, the government must act to restore fairness and accountability,” Mohan added.
"Bengaluru sees 4.8 lakh rides daily. Overcharging just Rs 50 per ride amounts to a daily loss of Rs 2.4 crore. Since May 2024, commuters have lost Rs 1,010 crore,” Mohan said.
“Why hasn’t the state government enforced the HC-mandated fare cap? Will it act while Rs 2.4 crore is looted from Bengalureans every single day? Who will compensate commuters for the Rs 1,010 crore already lost? How long will the government remain a mute spectator?” he asked.
Charges, charges everywhere
A quick scroll through X (formerly Twitter) reveals a growing chorus of frustrated voices.
One user shared a screenshot of a ride invoice: base fare of Rs 165, and then a Rs 45 “driver charge,” Rs 9 “congestion fee,” and Rs 3 “platform fee.” Another user, after paying Rs 309 for a 7-km Uber ride, wrote: “The base fare was Rs 165. The rest was all platform/driver/congestion charges. The HC order means nothing in practice.”
Namma Yatri, the government-backed ride-hailing app launched with the promise of zero commissions, has introduced some of these fee elements, including an optional tip, platform costs, and congestion charges.
Driver additions… at a cost?
Perhaps the most puzzling fee is the so-called “driver charge” or “additional driver fee,” which typically ranges from Rs 20 to Rs 35 per ride.
“Platforms don’t offer a clear explanation for this. After all, no ride exists without a driver, so why are users paying extra for one,” Said another user requesting anonymity.
“Every day I’m paying Rs 10 to Rs 50 extra for some random charge,” said @chanting_baniya on Twitter. “Today it was Rs 25 for a ‘driver fee.’ What’s next? An engine fee?”
A double blow: Bike taxis banned
If riders hoped to switch to cheaper options, those hopes were dashed earlier this year when Karnataka banned bike taxis. This low-cost alternative, popular among students and working professionals, offered point-to-point rides for Rs 30 to Rs 80 in many areas. Now, commuters are forced to choose between inflated auto fares or surge-priced cabs.
“There’s no real affordable transport left now,” says Suresh, a college student in Jayanagar. “BMTC buses are crowded, autos refuse rides, and bike taxis are banned. I’ve stopped going out unless I really need to.”
The road ahead
For a city already struggling with traffic congestion, poor road infrastructure, and erratic public transport, the unraveling of app-based convenience is a setback.
Ride-hailing platforms were once seen as a saviour in Bengaluru’s mobility mess. Today, they’re being seen as yet another problem.
Also, read: Karnataka bike taxi ban: Why innovation, government policies collide at India’s start-up hub
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