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Ola, Uber Can Now Charge 2X More: Ride Cancellation Penalty, Base Fare, & Other Key Rules Updated
Cab fares from companies like Ola and Uber might increase due to updated rules. The government now permits these services to charge up to twice the base fare during busy times. Previously, they could only charge 1.5 times the base fare as a surge price during peak hours.
The Ministry of Road Transport and Highways (MoRTH) released the revised Motor Vehicle Aggregator Guidelines for 2025 on Tuesday. These guidelines state that during non-peak hours, aggregators can charge a minimum of 50% of the base fare. The base fare is determined by the state government for each vehicle category or class.
Driver Compensation and Fare Distribution
According to the new guidelines, drivers working with aggregators will receive at least 80% of the applicable fare, covering all costs under the driver's fare. The remaining amount may be kept by the aggregator as their share. Payment settlements can occur daily, weekly, or fortnightly based on agreements between drivers and aggregators.
If a driver is using a vehicle owned by the aggregator, they will receive at least 60% of the applicable fare, including all specified costs in Driver Fare. The rest will be retained by the aggregator as Apportioned Fare.
Cancellation Penalties
The guidelines also address ride cancellations. If a driver cancels after accepting a journey without a valid reason, they face a penalty of 10% of the fare, capped at Rs 100. Similarly, passengers cancelling without valid reasons incur a similar penalty.
The guidelines aim to create a light-touch regulatory framework while addressing user safety and driver welfare concerns. States are encouraged to adopt these revised guidelines within three months.
Base Fare and Dead Mileage
The base fare must cover at least 3 km to account for dead mileage, which includes travel without passengers and fuel used for pickups. Passengers won't be charged for dead mileage unless their ride is under 3 km. Fares are calculated from where passengers start their journey to their drop-off point.
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