Wednesday, July 02, 2025
By Kamal Swami
Cab Users Will Have To Pay High During Peak Hours
The Ministry of Road Transport and Highways (MoRTH) has approved the revision of pricing norms for cab aggregators, including popular platforms like Ola, Uber, and Rapido. As per the newly issued Motor Vehicle Aggregator Guidelines, 2025, companies can now charge up to twice the base fare during peak hours and adverse weather conditions from the passengers. The revised guidelines were issued on Tuesday, June 30, 2025. According to the new guidelines, aggregators can reduce fares by up to 50% below the base fare during off-peak or low-demand periods. State governments have been given a three-month time limit to adopt the revised policy.
Until now, surge pricing was capped at 1.5 times the base fare. Under the new rules, aggregators are allowed to charge a minimum of 50% lower than the base fare and a maximum of 2 times the base fare. For instance, if the base fare is Rs 100, fares may range from Rs 50 during low demand to Rs 200 during peak hours. The base fare, which will be determined and notified by respective state governments for each vehicle category, must account for a minimum distance of 3 kilometres. This is intended to compensate for "dead mileage," which includes travel without passengers and fuel used to reach the pickup location. However, the ministry clarified that passengers cannot be charged for dead mileage if the cab is within 3 km of the pickup point. For longer distances, the fare will apply only from the point of pickup to the drop-off location.
No Change in Cancellation Charges
There is no revision in cancellation charges. Passengers who cancel a ride without valid reasons after booking confirmation can be charged 10% of the fare, subject to a maximum of Rs 100. The cancellation policy must be clearly outlined on the aggregator’s website and app. The collected fee will be shared between the driver and the aggregator.
A Response to Changing Mobility Needs
This marks the first major revision since the Motor Vehicle Aggregator Guidelines, 2020, were introduced under Section 93 of the Motor Vehicles Act, 1988. The ministry stated the update was necessary due to the evolving landscape of shared mobility, which now includes bike-sharing, electric vehicles, and auto-rickshaws. “With the expansion of services and demand for flexible travel solutions, the 2020 guidelines have been updated to reflect the current needs of consumers and service providers,” the ministry noted. It emphasised that the 2025 guidelines aim to maintain a light-touch regulatory framework while prioritising user safety and driver welfare.
