Update: Ola told MediaNama that its in-app wallet Ola Money was developed in house and is a closed system payment instrument. They are issued by a company for facilitating the purchase of goods and services from an establishment. These instruments do not permit cash withdrawal or redemption. As these instruments do not facilitate payments and settlement for third party services, issue and operation of such instruments are not classified as payment systems. Read more here.
Earlier: Online taxi hailing service Ola has introduced cashless payments for rides on autorickshaws and kaali peeli taxis through their in-app wallet Ola Money across Hyderabad, Chennai, Pune, Ahmedabad, Delhi,Bangalore and Mumbai. Ola also mentions that over 40,000 autorickshaws and kaali-peeli taxis have been registered across India on its mobile application.
How it works
To pay through the in-app wallet, the customer has to simply inform the auto rickshaw driver that the payment will be made with Ola Money. On completion of the ride, the driver shall enter the fare displayed on the meter, followed by the four-digit OTP that the customer will receive through an SMS. Ola money is then automatically deducted from the customer’s account. Drivers can withdraw their payments anytime from the prepaid ATM card that is linked to their Ola account.
Drivers will now have their daily earnings deposited into their account with Ola, linked to a prepaid card usable at ATMs or any merchant. Ola told MediaNama that it has tied-up with reputed banks for providing the prepaid cards.
It’s worth noting that Ola does not have a prepaid payments instrument licence from the Reserve Bank of India. What’s not clear is whether Olacabs has partnered with any prepaid wallet license holder to offer their wallet service. We’re currently awaiting a response from Olacabs on this.
Its competitor Uber has has exclusively partnered with Paytm to enable users make use of Paytm’s prepaid wallet to pay for their tax rides. This tie-up was necessitated after Reserve Bank of India (RBI) issued a directive that Card Not Present (CNP) transactions for purchases of goods and services in India had to be processed through Indian banks and payments needed to be made in Rupees in August this year.
Ola launched its in-app wallet in September 2014 and began offering auto rides in Bangalore in November 2014. It introduced kaali-peeli taxi services in October 2014. Earlier this month Ola bought its rival TaxiForSure $200 million in a cash and equity deal.