Source: Entrackr
The Central Consumer Protection Authority (CCPA) issued notices to ride hailing apps, including Ola, Uber India and Rapido, over a month ago regarding their advance tipping feature. The tipping feature for users of these apps is still operational and users are still seeing the advance tipping prompts prior to or during their ride bookings.
What Is Advance Tipping?
Advance tipping is a mechanism that allows users to provide a tip to the driver prior to a ride, before they have even begun. Companies say advance tipping is simply an option for users and is designed to support drivers. However, many users feel a fair amount of pressure to provide a tip so that their ride isn’t delayed or cancelled.
Users Raise Concerns
The issue has been raised by numerous users being “nudged” into tipping or were unable to find information about tipping or were not informed that tipping would be a part of the ride. Many users were surprised to see the tipping amount set by default in one or more apps or felt that they had no way to opt out. Whatever the case may be, many users felt that this practice is objectionable or unfair and is misleading, particularly given that they had not taken the ride yet.
Users also face other issues with these apps, such as:
- Drivers asking for the destination and then cancelling
- Requests to pay in cash even after online payment
- Poor customer support and long wait times
These problems, along with the advanced tipping feature, have caused frustration for many.
Government’s Response
Union Consumer Affairs Minister Pralhad Joshi posted on social media about the issue. He stated that the government is treating this substantively, and CCPA is investigating platforms like Ola, Uber, and Rapido. If others like Namma Yatri are identified to use similar tactics, it will too be investigated.
However, there has not been any update by the government or the companies as of June 22, or any indication of the companies taking notice or addressing the issue.
Feature Still Visible in Apps
Though they received notice, all four apps, Ola, Uber, Rapido and Namma Yatri, are still displaying tipping options in their apps. They typically appear during the payments step, or in the fare summary.
Some users claimed Namma Yatri was the first app in Bengaluru to allow for tipping in advance of service. The other apps subsequently added the feature. We don’t yet know if Namma Yatri received a notice like the others from the CCPA. At this point, none of the companies, nor the CCPA, have responded to questions about this.
Ola, Uber, Rapido, Namma Yatri, and the CCPA had not responded to queries by Entrackr yet.
Is This Fair?
Tipping is not illegal. However, it could become problematic for apps that ask their users to tip while booking a ride without the user’s full knowledge because it could be construed as unfair trade practice. Critics have identified that passengers are being asked to be responsible for giving drivers extra money while the apps continue to keep a cut. These practices have raised questions about the companies and how fairly they are treating their users and drivers.
Earlier this year, Ola and Uber received notices for charging different prices to Android users and iPhone users. The companies denied doing this, stating they charge the same amount for every user.
In conclusion: The advance tipping feature continues to function on major ride apps in India, despite government concerns. Users feel deceived, and regulators have yet to take robust action. The issue remains open to debate as advocates ask whether the practice is fair and if stronger regulations are needed to protect consumers.
