Centre mulls ban on surge pricing by app-based cabs WHAT IS SURGE PRICING?
NEW DELHI: Popular taxi aggregators like Uber and Ola may soon have to go by fixed fares — spelling the end of surge pricing — with the gover nment planning to bring them under the ambit of the motor vehicles Act.
The app- based cab- booking services run in a grey area without government checks. Popular for their heavy discounts and easy availability, their practice of surge pricing — increasing fares when demand outstrips supply — has, however, come in for criticism.
The road transport ministry is working on a proposal to bring taxi aggregators within the regulatory framework of the MV Act under a new category — ‘ intermediaries’.
A ministry official said, “Intermediaries will cover service providers such as Uber and Ola that do not have their own vehicle fleets but function in the online market space by linking driver/owner with customer and charging a fee for the service.”
Bringing taxi aggregators under the regulatory framework will mean they won’t get to arbitrarily fix fares.
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