Uber’s tipping controversy puts spotlight on Rapido

The central government has issued a notice to ride-booking company Uber following reports that the platform is encouraging passengers to pay a “pre-ride tip” to secure faster service. This development has sparked serious concerns within the Ministry of Consumer Affairs, which is now closely examining the practice.

Union Minister for Consumer Affairs Prahlad Joshi expressed strong disapproval of Uber’s method via social media. “Requesting or indirectly compelling consumers to pay a pre-tip for faster service is unethical and tantamount to extortion. Such practices fall under unfair trade practices,” said Prahlad Joshi.

The issue came to light recently when it was revealed that Uber had been promoting pre-ride tipping to passengers under the pretext of improving ride speed. The government considers the act of demanding tips before the service begins as a direct violation of consumer rights and a breach of consumer protection norms.

In response, the Ministry has served Uber a notice demanding an explanation of this practice. Furthermore, preliminary indications suggest that if similar methods are being employed by other ride-hailing platforms, such as bike taxi service Rapido, they too may come under scrutiny.

According to sources, if initial evidence confirms that Rapido is also encouraging consumers to pay a tip prior to availing the service, the Central Consumer Protection Authority (CCPA) may initiate a preliminary inquiry against the company. This development could have significant implications for the business models of ride-hailing platforms across the country.