No 20% cut for Uber from Delhi drivers as co models itself on govt app Pooch-O

Uber, the US-based online taxi-hailing company, will not take any commission from its drivers in New Delhi until uncertainty over how it can operate in the country’s capital city is cleared up.

Uber was banned in the capital  following rape allegations against one of its drivers. But the company restarted services there last week and applied for a radio taxi licence. A transport official said on Friday that Uber remained blacklisted.

Uber in a statement on Tuesday said it has  adopted a business model similar to a government-approved smartphone app called ‘Pooch-O’, which connects customers with commercially-licensed auto-rickshaws and does not charge any fee.

“Uber has modified its business model in line with the above framework, and is currently operating without commission or fees until the regulatory ambiguity is resolved,” Uber said.

“This allows Uber to legally operate … while working out the details of a long-term solution with the government.”

Uber was taking a commission of 20 percent from its drivers in New Delhi, and started offering additional incentives including a 250-rupee bonus per trip after resuming operations last week.

“Definitely it hurts our business as we are not to going make any money. We will in fact spend money to run Delhi operations for our riders,” a senior Uber executive, who did not wish to be identified, was quoted as saying by Reuters.

Here is Uber’s entire statement:

On Thursday of last week, Uber resumed operations in New Delhi under a new operating model. In December, per the request of Delhi’s transportation department, we had taken the step of shutting down operations. They had ordered all web-based applications be shut down pending grant of a radio-taxi license, and Uber Delhi accordingly complied with the request.

Today, each of the major transportation apps including Uber have taxi license applications in process. Each of the major transportation apps including Uber are also currently running in Delhi.

_We are committed to obtaining this license but also wanted to clarify Uber’s current operating model. Since our re-launch we have adopted Pooch-O’s model, one already approved and endorsed by the transportation department. This allows Uber to legally operate, enabling safe, reliable rides to an underserved public while working out the details of a long-term solution with the governmen_t.

The details of Pooch-O’s model are as below :

It acts as a marketplace between rider and driver, allowing riders easy access to the closest transport providers, and allowing drivers a way to more paying customers. It is an app that connects rider to only commercially licensed drivers It is a not-for-profit platform that takes no commissions or fees for its marketplace services. It requires that all drivers have a PSV Badge issued by the Delhi government Uber has modified its business model in line with the above framework, and is currently operating without commission or fees until the regulatory ambiguity is resolved. Additionally, we will take responsibility for providing a safe transportation platform and continue to innovate in process and product to make Uber safer in Delhi, across India and around the world.

With inputs from Reuters