Ola, Uber rates: Govt plans to cap commission per ride at 10% of total fare

New rules for Ola, Uber: This is the first time the government is considering to regulate the commission earned by such firms, which at present stands at around 20%

New rules for Ola, Uber: The Centre is planning to impose a ceiling on the commission earned on rides by cab-aggregators such as Uber and Ola. The central government is mulling a 10% cap of the total fare in its forthcoming norms for ride-hailing companies and the rules regarding the same may be in place by this year-end.

This is the first time the government is considering to regulate the commission earned by such firms, which at present stands at around 20%.

“We are planning to release the draft (aggregator rules) for public feedback sometime next week. It will largely be in line with the guidelines that were shared, with a few small changes,” a road transport and highways ministry official told the Economic Times. The ministry has prepared the guidelines which it shared with the states last month.

Also Read: Ola, Uber rates: Govt to review cab aggregators over surge pricing

Furthermore, the state governments, if they wish to, might impose a duty on the cab-aggregators’ earnings as well, as per the guidelines shared by the Centre with state officials.

Meanwhile, the government is already in the process of reviewing cab-hailing companies such as Ola and Uber on the contentious issue of surge pricing and has proposed to cap it to a maximum of twice the base fare, the report said.

The Centre has also suggested that the base fare can be determined by the state, or suggested by the aggregator company and revised every quarter.

Also Read: Odd-even rule: Ola, Uber drivers plan strike in Delhi on November 11

Although, there is a follow-on clause, which states that no more than 10% of daily rides taken up by a driver can be subject to surge pricing, the report added.

Surge pricing happens when a cab aggregator increases fares commensurate with a rise in demand.

The final norms for cab aggregators notified under the Motor Vehicle Act, 2019 that came in to effect on September 1, are expected to be formalised before the year-end.