Applying brakes on surge pricing

Bengaluru based start-up company launches a bidding platform to stop surge pricing by taxis.

Published: 13th May 2016 03:15 AM  |   Last Updated: 13th May 2016 03:15 AM   |  A+A-

THIRUVANANTHAPURAM: Even as surge pricing by app-based cab service providers has led to severe discontent among users across the country, a Bengaluru based start-up company has launched a new venture to tackle this. They have developed an app which opens up a lot of choices for the customers through ‘bidding’.

The bidding technique, a first in India, works with the taxi service providers sending bids, in which they quote the fare for a journey, to the customers when they post the details of their journey in the app.

The venture was launched in Thiruvananthapuram and Bengaluru simultaneously in May and in a  brief time raked in a huge response from the customers. The service was launched in Ernakulam earlier this week.

Administrations across the nation have locked horns with the cab services for surge pricing, a process where the fare for a journey multiplies during peak hours. This feature, however, vests more power with the customer who can choose from a variety of options.

On the bidding platform, the customer first places his requirements in the app by entering the location and destination of the journey. Once the journey details like date, time, number of passengers and other requirements are posted, the taxi service providers bid on it and start quoting their rates.

Bids are allowed till thirty minutes prior to the time of the journey in the case of travel planned for a late date and closes within fifteen minutes after the requirement is placed by the customer for an immediate journey. The customer can then choose from the list of bids placed by the taxi providers and choose the lowest fare.

B Karthigeyan, a service engineer with Godrej, is all praise for the bidding initiative launched by the company. “Being a frequent traveller, I find this highly useful since the rates quoted by the service providers are competitive and such a novel initiative gives the customers plenty of options to choose from,” he says.

Alwin George, CEO of Vehiclest, says that the model, which is a highly sustainable one, goes a long way in protecting the rights of the customer. “It opens up several choices for the customers and puts a check on surge pricing.”

He adds that the team is in the process of introducing a new feature wherein bids by players above the maximum fare set by the government gets cancelled automatically and will not reach the customer. “This brings in more control,” he adds.

“Even in Thiruvananthapuram, most of the cab service providers inflate the fare during peak hours by as much as 2.4 times the base rate and this puts a burden on the customers. Through the bidding process, the customer can choose the lowest fare from the bids submitted by the taxi service providers,” he adds.

The company has roped in several established taxi service providers. The team intends to extend the bidding platform across all the commuting and transportation services provided by the company.

VehicleST, is an online platform which connects various transportation and travel based service providers with the customer. It  provides its service through its website and the mobile app of the site.

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