Cap surge pricing by Uber, Ola at 25 per cent: SJM urges Transport Ministry

The SJM also demanded that in case of ride cancellation by a taxi-app company or the driver, Rs 100 or an amount equivalent to 20 per cent of the fare should be credited as a penalty

The Transport Ministry should ensure surge pricing by cab aggregators like Uber and Ola is capped at 25 per cent, RSS-affiliate Swadeshi Jagran Manch (SJM) said on Tuesday, cautioning that if not done, states might form their own rules under the Motor Vehicles Act, 2019, and set a lower limit.

The SJM's suggestion assumes significance as several states, including those where the BJP is in power, have decided to draft their own penalty structure under the act, different from that suggested by the ministry.

The act came into effect from September 1 and hefty fines have been imposed for various traffic violations.

In a letter to Union Transport Minister Nitin Gadkari, SJM co-convener Ashwani Mahajan said as per reports, the Ministry of Road Transport and Highways (MoRTH) is considering allowing surge pricing to the extent of three times of the normal fare.

He also cited a survey conducted among taxi users and said a specific amount should be credited to a customer's account in case an app-based cab company or its driver cancels a ride.

Underlining that taxi aggregator rules under the Motor Vehicle Act, 2019, should be made keeping "public interest" in mind, Mahajan said, "People want surge pricing to be capped at not higher than 25 per cent."

"If that is not done, it would be an unpopular move and we may risk states coming up with their own rules and setting lower limits of surge pricing for taxi aggregators," Mahajan said.

Taxi aggregators Uber and Ola, which started operating in India to provide lower cost and convenient services, have now started profiteering under the ambit of surge pricing, he said

The SJM also demanded that in case of ride cancellation by a taxi-app company or the driver, Rs 100 or an amount equivalent to 20 per cent of the fare should be credited to the customer's account as a penalty

Mahajan said at present, app-based cab operators levy a penalty when a customer cancels a ride but the same doesn't work the other way around.

The basic customer service and app features must be standardised to facilitate speaking with customer service centres in case of an emergency or need, the SJM co-convenor said.