Users of app-based cab hailing services in Bengaluru will have to spend more on their rides. The Karnataka government on Wednesday notified minimum and maximum fares for taxis operated by aggregators like Ola, Uber, and others. The new pricing structure has been split into four bands depending on the cost of the vehicle.

The new pricing structure will also allow cab aggregators to legally exercise dynamic or surge pricing as the Transport department has set minimum and maximum fair limits.

Breaking it down

  • Hiring a D-class cab (vehicle costing less than Rs 5 lakh) will cost Rs 44 for the first four kilometers. For subsequent kilometers, the aggregators can charge a maximum fare of Rs 24 and a minimum of Rs 11.
  •  For C-class (vehicles costing between Rs 5 and 10 lakh), the first four kilometers cost will be Rs 52. For subsequent kilometers, a maximum rate of Rs 24 and minimum of Rs 12 will be applicable.
  •  For B-class (vehicles costing between Rs 10 and 16 lakh), the first four kilometers will cost Rs 68, after that a maximum of Rs 16 per km and minimum of Rs 34 per could be charged.
  • A-class cabs (vehicles costing above Rs 16 lakh), for the first four kilometers the rate would be Rs 80 and thereafter maximum of Rs 45 per km and a minimum of Rs 20 will be applicable.

The notification also mentions that there will be no waiting charge for the first 20 minutes after that Rs 10 will be charged for every 15 minutes.

The new fare structure will come into effect immediately for air-conditioned city taxis operating under Karnataka on-demand Transportation Technology Aggregators rules, 2016 within the radius of 25 km of Bengaluru city.

The notification states that the measure is being taken keeping in mind fuel price hike, cost of vehicle and maintenance cost, among other things.

Reactions to the fare restructuring

In a statement to the Economic Times the state’s Commissioner for Transport and Road Safety, B Dayananda said the department has tried to strike a balance among cab operators/aggregators, drivers, and customers. “It’s a win-win situation for all,” he told ET. “The revised fare structure will ensure that cab aggregators operate within the framework of the rule. We have taken into account all sides. The department is open to make any changes in the future if required.”

The Economic Times also quotes a department official who explained the contrasting demands of the taxi aggregators and drivers: “The cab aggregators wanted us to increase the maximum fare cap in all categories so that they could charge high during peak hours. The demand from drivers, however, was to increase the minimum cap as they feel that cab aggregators make money at their expense.”

In a statement to the media, Uber welcomed the new fare structure. “The revision will help improve the earnings potential (of drivers) and create sustainable livelihood opportunities. While it is a step in the right direction, we believe dynamic pricing will help increase reliability for riders and improve asset utilization for driver partners,” said Christian Freese, general manager-South, Uber India.