Ola-Uber can charge double fare during peak hours: 10% penalty if driver cancels ride, government says - implement new rules within 3 months

 Ola, Uber, and Rapido can now charge up to double the fare during peak hours. The central government has issued guidelines allowing app-based taxi services to do so. The government has directed that the new rules be implemented within three months (by September).

Social News In Rajasthan 

Understand the New Fare Hike Rules in 7 Questions and Answers…

Question 1: What new rule has the government introduced for cab companies?

Answer: The central government on Tuesday released the Motor Vehicle Aggregator Guidelines (MVAG) 2025. Under these guidelines, cab companies like Ola, Uber, Rapido, and inDrive are now allowed to charge up to twice (2x) the base fare during peak hours. Earlier, this limit was capped at 1.5 times the base fare.

Social News In Rajasthan 

Example: Suppose in Bhopal, the base fare for a cab is ₹100 for 5 kilometers. Under the new rules, the company can charge up to ₹200 during peak hours.

Question 2: What are peak hours?

Answer: Peak hours are the times when there is heavy traffic on the roads, leading to increased demand for cabs, or when bad weather conditions prompt more people to book rides. Typically, peak hours are between 8–11 AM in the morning and 5–9 PM in the evening. Rain, festivals, or major events can also result in peak hours.

Example: During the monsoon in Jaipur, there is heavy rainfall. At office hours, when people are trying to get to or from work, demand increases. If the base fare is ₹20 per kilometer, for a 5 km ride during peak hours in the rain, you may have to pay up to ₹200 instead of ₹100 (2x). Earlier, the maximum fare used to be ₹150 (1.5x).

Question 3: Will the fare be affected during non-peak hours as well?

Answer: Yes, according to the new rules, during non-peak hours (when demand is low), the fare must be at least 50% of the base fare. For example, during the afternoon or late at night, the minimum fare will be 50% of the base fare. This means companies cannot charge less than half the base fare, even for very short rides. This rule has been introduced to ensure a minimum income for drivers.

Example: In Lucknow, the base fare for a bike taxi for 2 kilometers is ₹100. During non-peak hours, like at 2 PM, if you take a 2 km ride, you will have to pay at least ₹50. Earlier, the company used to charge even less than that.

Question 4: What is base fare and who decides it?

Answer: Base fare is the minimum fixed fare set for a certain distance or time for cabs, auto-rickshaws, or bike taxis. This fare is decided by state governments, as transport regulations fall under the jurisdiction of the states. The base fare depends on the city, the type of vehicle (such as sedan, SUV, auto, or bike), and local conditions.

Question 5: What happens if the driver cancels the ride?

Answer: If a driver cancels the ride after accepting it without a valid reason, a penalty of 10% of the base fare will be imposed on them, with a maximum cap of ₹100. This rule has been introduced to prevent drivers from cancelling rides arbitrarily.

Example: Suppose you book a cab in Indore with a base fare of ₹200. If the driver cancels the ride before starting it, a penalty of ₹20 (10% of ₹200) will be applied. Even if the base fare is ₹1500, the maximum penalty will still be ₹100.

Question 6: When will these rules come into effect?

Answer: The central government has advised all states to implement these new rules within the next three months, i.e., by September 2025.

Question 7: Have any other changes been made?

Answer: Yes, under the new rules, an insurance cover of up to ₹5 lakh has been made mandatory for all drivers to ensure their safety.

Social News In Rajasthan