Centre Orders Cab Aggregators to End Advance Tipping Before Rides
Government directs Ola, Uber, Rapido and others to scrap advance tipping, calling it misleading; Rapido fined Rs 10 lakh.
The Centre has instructed cab and bike-taxi aggregators to stop offering riders the option to tip drivers before a trip is booked, with Consumer Affairs Secretary Nidhi Khare describing the practice as misleading and an unfair trade practice.
Speaking on Wednesday, Khare said the National Consumer Helpline had logged a number of complaints against taxi and ride-hailing platforms. Among the main grievances was the advance tipping feature, which allowed customers to add a tip before they had even taken the ride.
Consumers alleged they were being nudged into paying a tip upfront and were led to believe that not doing so could hurt their chances of getting a ride. "We found this to be misleading and also an unfair trade practice," Khare said, adding that the order to discontinue the built-in mechanism followed a detailed investigation and hearing.
Khare, who also heads the Central Consumer Protection Authority, underlined that tipping is entirely voluntary and should be left to the consumer's discretion after a ride is completed.
Her remarks came a day after the CCPA levied a Rs 10 lakh penalty on Roppen Transportation Services Private Limited, which runs Rapido, over alleged unfair business practices. The action covered concerns around advance tipping, misleading advertisements, unfair contract terms and the use of dark patterns that pushed riders to pay more before their trips were confirmed.
The regulator is also reviewing the practices of other major ride-hailing players, with investigations into Uber and Ola currently under way.
The move against Rapido is part of a wider sectoral examination of cab and bike-taxi aggregators in India, covering practices such as pre-ride tipping and dynamic pricing. The CCPA had earlier sent notices to Uber, Ola, Rapido and Namma Yatri, asking them to comply with the Guidelines for Prevention and Regulation of Dark Patterns, 2023.
Dark patterns refer to deceptive or manipulative user-interface designs that can steer consumers into choices they might not otherwise have made.