Govt Allows 2x Surge Pricing During Peak Hours for Uber, Ola, Rapido - What It Means for Commuters
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The government has rolled out new rules for cab and bike-taxi services like Uber, Ola, Rapido, and inDrive. These updated guidelines now allow ride fares to spike up to twice the base fare during rush hours - impacting both riders’ budgets and driver responsibilities. Here’s what you need to know.
Peak Hour Fares Get a Hike
Ride-hailing platforms can now charge up to 2x the base fare during high-demand periods - up from the earlier limit of 1.5x. During non-peak hours, fares must stay at or above 50% of the base fare.
The Ministry of Road Transport and Highways has asked states to adopt the revised framework within three months. The goal is to balance rider affordability while avoiding extreme discounting by aggregators.
Who Sets the Base Fare?
States will decide the base fares for different vehicle types - taxis, autos, and bike taxis. In regions where no fare has been declared, the ride service must inform the state about its base pricing.
Examples:
Stricter Cancellation Rules
Drivers and passengers who cancel a ride after it’s confirmed will now face a penalty:
Mandatory Insurance for Drivers
To offer better protection for drivers, the new rules require platforms to provide:
Dead Mileage Clarity
Drivers will not be able to charge for “dead mileage” (the distance travelled to pick up a rider) unless the pickup point is within 3 km. Only in such cases can fare be calculated from the departure point.
Better Safety and Service Standards
To boost rider safety and improve service quality:
What It Means for You
Commuters should prepare for costlier rides during peak hours, but also benefit from safer and more accountable services. Meanwhile, drivers receive more structured training and insurance benefits - raising overall service standards across the board.
Peak Hour Fares Get a Hike
Ride-hailing platforms can now charge up to 2x the base fare during high-demand periods - up from the earlier limit of 1.5x. During non-peak hours, fares must stay at or above 50% of the base fare.
The Ministry of Road Transport and Highways has asked states to adopt the revised framework within three months. The goal is to balance rider affordability while avoiding extreme discounting by aggregators.
Who Sets the Base Fare?
States will decide the base fares for different vehicle types - taxis, autos, and bike taxis. In regions where no fare has been declared, the ride service must inform the state about its base pricing.
Examples:
- Delhi & Mumbai: ₹20–₹21/km for taxis
- Pune: ₹18/km
Stricter Cancellation Rules
Drivers and passengers who cancel a ride after it’s confirmed will now face a penalty:
- 10% of the fare, capped at ₹100
- The fine will be shared between the driver and the platform
Mandatory Insurance for Drivers
To offer better protection for drivers, the new rules require platforms to provide:
- Health insurance cover of ₹5 lakh
- Term insurance of ₹10 lakh
Dead Mileage Clarity
Drivers will not be able to charge for “dead mileage” (the distance travelled to pick up a rider) unless the pickup point is within 3 km. Only in such cases can fare be calculated from the departure point.
Better Safety and Service Standards
To boost rider safety and improve service quality:
- All vehicles must have tracking devices connected to the state’s control centres.
- Annual refresher training is mandatory for all drivers.
- Drivers falling in the bottom 5% rating bracket (based on their service period) must attend quarterly training sessions, or face deactivation from the platform.
What It Means for You
Commuters should prepare for costlier rides during peak hours, but also benefit from safer and more accountable services. Meanwhile, drivers receive more structured training and insurance benefits - raising overall service standards across the board.
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