Paying Extra on Your Uber And Rapido Rides? Govt May Act On Upfront Tip Practices

Rapido is under the scanner for its practice of asking advance tip from users to increase their chances of booking a ride. The central government may take action against the bike-taxi platform Rapido for engaging in upfront tip practice after it sent a notice to Uber for the same reason, reported India Today citing sources.

Over the past few days, Rapido users are seeing a message urging them to add an extra tip of Rs 10, Rs 40, or Rs 70 whenever they book a ride. The additional tip has been asked to boost the chances of ride booking. According to reports, similar practices are used by its competitors, like Uber.

Govt Issues Show Cause Notice To Uber

Consumer protection watchdog Central Consumer Protection Authority (CCPA) has sent a notice to ride-hailing platform Uber for allegedly 'forcing or nudging' users to pay advance tips for faster service.

The matter was also brought to the limelight by Consumer Affairs Minister Prahlad Joshi. While expressing concern over 'advanced tip' practice, Joshi wrote in a social media post, "Forcing or nudging users to pay a tip in advance, for faster service is unethical and exploitative. Such actions fall under unfair trade practices. Tip is given as a token of appreciation not as a matter of right, after the service."

Taking cognisance of the matter, the Union Minister urged CCPA to take action into the matter. "Today CCPA has issued a notice to Uber in this regard, seeking explanation from the platform. Fairness, transparency and accountability must be upheld in all customer interactions," added Joshi in his post.

Rapido Charges Extra Tip

Akin to Uber, Rapido users have also experienced messages from the application to add "extra tip" to secure a ride faster. In December 2024, CCPA had initiated an inquiry against ride-hailing services app like Ola Uber and Rapido over accusations of engaging in differential pricing tactics, where the cost of the same rides varies based on whether the customer is using an Android or iOS device.

Ride-hailing bike services are not available across India, and in certain states, where these services are either prohibited completely or have been allowed to operate with restrictions.

Karnataka High Court in April had ordered the suspension of bike taxi services in the state. The decision was announced by Justice BM Shyam Prasad. The HC ordered the suspension of these bike taxi services stating that the state government must formulate appropriate regulations under the Motor Vehicles Act, 1988. Earlier, Karnataka HC had granted a six-week period for these applications to cease their services in the state. However, in a recent update, the prohibition on bike-taxi services in Karnataka has been further extended to June 15, reported The Hindu.

The extension was announced after Roppen Transportation Services Pvt. Ltd, operator of Rapido Services, had told the court to extend the deadline. One of the reasons cited for deadline extension was to seek some time to make alternative arrangements of persons currently engaged as bike-taxi riders. According to a The Hindu report, Rapido has around 6 lakh bike taxis registered in Karnataka and bike riders are completely dependent on these services to earn a living.