84% Cab-Hailing App Users Claim Drivers Cancel Rides Over Destination, Digital Payment Mode: Survey

Despite cab-hailing apps gaining popularity, the user experience has failed to improve. A recent survey said that players in the sector are yet to expand their reach across the country and improve consumer experience. Nonetheless, the presence of multiple new players including BluSmart, inDrive, Rapido, etc., in addition to the established Ola and Uber is helping consumers have more choice when they need a ride.

Attempt by the state-run Open Network for Digital Commerce (ONDC) to create a network of last-mile service providers to make travel seamless for commuters moving within cities, is also making a small difference. Several apps offering services of auto-rickshaws and taxis not linked with any of the established companies are coming up in cities like Bengaluru, taking advantage of ONDC’s policy of not charging any commissions. 

"LocalCircles first raised the consumers’ concerns with app taxi aggregators in 2019 with the Ministry of Road Transport and Highways (MoRTH) following which the Government in November 2020 brought the Motor Vehicle Aggregator Guidelines, which among other directives capped the surge pricing at 1.5 times higher than the base fare, and also introduced cancellation penalty for drivers at 10% of fare capped at INR 100. The guidelines have however not been operationalized by most states thereby leading to continued consumer grievances," said the survey agency.

The convenience of having the option of app based taxi services in many cities is undeniable as it has provided for market competition and an alternative to using your own vehicle. However, it has also become a headache for consumers due to an increasing number of last minute cancellations of rides by drivers not wanting to go to a particular destination or not wanting to accept digital payment, surge pricing and rude behaviour of drivers. A survey by LocalCircles in April 2022 revealed that 71% of app taxi users were still facing ride cancellation issues. In May 2022, after the LocalCircles survey was released, the consumer regulator CCPA issued notices to some of the platforms on Unfair Trade Practices but that too has had limited impact on the ride cancellation front. So far, only the Delhi government has come out with a draft cab policy. It has however not prevented ride cancellation by drivers. Based on inputs from both platforms and drivers, there are no disincentives or penalties in place for drivers who cancel rides.

Given the continued complaint flow on app-based taxi aggregators, LocalCircles decided to conduct another national survey to find out if anything has changed on the ground for the consumers. The survey received over 44,000 responses from app taxi consumers located in 276 districts of India. 64% respondents were men while 36% respondents were women. 41% respondents were from tier 1, 36% from tier 2 and 23% respondents were from tier 3, 4 and rural districts.

Experience of taking app-based taxi service varies from city to city. The first question in the survey asked respondents, “What have been some of the major issues you have experienced with app taxis in the last 12 months?” to which 3 out of 4 respondents indicated “drivers cancelling the ride”. Some among the 11,119 respondents to this query indicated more than one reason. Thus, 62% indicated “surge pricing”, 48% long waiting time, 29% “vehicle cleanliness”, 23% “cancellation charges”, 8% driver “courteousness”, 6% indicated “safety issues”, and 12% other unspecified issues. The response clearly illustrates that almost all the issues the 2020 motor vehicle aggregator guidelines sought to address have remained unaddressed.

The data shows drivers cancelling rides, surge pricing and long waiting times are the top issues app taxi consumers have faced in the last 12 months; 3 in 4 consumers experienced cancellation by the driver.

Focusing on the top reason for consumer disappointment, the survey next asked respondents, “When did your app taxi drivers cancel the ride or requested you to do the same?”. Out of 10,948 respondents to this query, 37% indicated “upon finding out the destination”; 5% “upon finding out that the payment will not be in cash but digital”; 42% cited both the earlier reasons; and 9% other reasons. In aggregate, 84% of respondents have faced cancellations either due to destination or due to not wanting to pay in cash or both the reasons, while only 5% stated that they had not faced any problems and 2% did not give any clear reason.

To the question “When did your app taxi drivers cancel the ride or requested you to do the same” the data shows that this year 79% did so “upon finding out the destination”; 47% faced the problem “upon finding out that the payment will not be in cash but digital”; and 9% indicated unspecified reasons.