[ChiragM]

This article has been sourced from The Ken.

According to the report, bike taxi service Rapido is using 2-wheelers with white plates instead of yellow plates. Competitors claim that Rapido is successful because their business is illegal in some states. According to the report, Rapido's per unit cost is between Rs. 850 to Rs. 900, which the competitors claim is viable only if the bikes are running with white plates.


Image source: The Ken

Rapido riders claim that they end up paying challans if they are caught by the traffic police. Some riders say that they just lie to the police about the pillion riders to escape fines. Clearly, privateers are using their private vehicles as a taxi. Rapido claims that it is helping their riders obtain yellow plates for their vehicles.

The main issue arises because there are no clear rules on running bike taxis in the Motor Vehicles Act (1988). While some states like Haryana, Telangana and Punjab have implemented the rules in a progressive manner allowing bike taxis to ply, some states like Karnataka have stuck to the rule book. In March, Ola was fined for its bike taxi service in Bangalore and its bikes were impounded. In comparison, Rapido's bikes were temporarily confiscated and released after a penalty was paid.

It is claimed that Rapido does 90,000 rides every day in 31 cities across the country. It is planning to expand the business to more cities over the coming months.

[NPV]

In Bangalore, there was a crackdown on Rapido's bike taxis (earlier with Ola's as well) in April and almost 100+ bikes were seized, surprised that they're still in operation now.

Source-Deccan Herald, Bangalore 5 Apr 2019 - Link

[GTO]

They sure have guts . It's the equivalent of me using my personal car on Uber / Ola. Not only are they denying the government of $$$, but this is also an unfair & illegal advantage over the competition.

I'm glad the-ken brought this shady practice to light. The authorities should clamp down hard on them & penalise Rapido in a way they won't forget.

Lots of history - related search. I'd never be a customer of a company that so blatantly abuses the law. If they don't respect the country they're operating in, they won't respect their customers either.

[Axe77]

Firstly, glad to see more readers of The Ken. They write excellent pieces beautifully researched.

I fully agree that this is blatantly illegal. However that has been the case with almost all disruptive brands be it Uber or airbnb or crypto currencies etc - in many if not most of the jurisdictions they have operated in. They start out capitalising on regulatory lacunae and then go on to engage with regulators who play catch up on regulations. In this case, it is particularly bad because in principle, various states have come with the concept of app based services (for cars) so what Rapido is doing, as people have said, is blatantly illegal and in my view perhaps a bit more aggregious than some other examples.

[nitishk]

Rapido is blatantly flouting rules and so are its drivers. A friend wanted a late night ride to his house in Kolkata(10:30 pm). Uber was quoting Rs 245. Yellow cab asked for 150, rapido was quoting Rs 58.
Here comes the best part, driver comes and demands Rs 70. A nice little extra on the side.

I would've paid and then complained. Unfortunately my friend didn't.

[Mortis]

Technically Ola and Uber are also illegal because the driver's use their phones while driving

[SS80]

I am not sure why the Bangalore Traffic Police has paused its action against Rapido company. But the company continues to silently post ads and continues to hire riders across different cities, Check out this screenshot from Olx.

[Lalvaz]

Very interesting. I'm curious to know about the potential impact in case of a fatal accident. Will insurance companies pay claims since Rapido is flouting the basic T&C of the insurance policy by using the private vehicle for commercial operations?



If they refuse to pay claims (and rightly so) that means the passenger's family will be bereft of any financial compensation. Also in the event that the rider has an accident with a third party, that third party will also not receive any compensation from the insurance company.



Seems blatantly illegal on so many grounds. Wonder how the management is planning to get away with this flawed business model.

[alpha1]

Law changes with time ... and only new business / innovation forces the changes in Law.

The main issue arises because there are no clear rules on running bike taxis in the Motor Vehicles Act (1988).

Till it is clear in black and white, let us not label some activity as illegal.

[speedmiester]

Originally Posted by alpha1

Law changes with time ... and only new business / innovation forces the changes in Law.


Till it is clear in black and white, let us not label some activity as illegal.

As per the current law of the land, it is clear as black and white. One cannot use their personal vehicles for hire, reward or for commercial purposes.
As long as Rapido riders are giving rides on personal bikes, it is illegal.

No Insurance company will cover for damages/injuries or death. If caught, the vehicle can be impounded.

[NPV]

Rapido Bike Taxi operators/riders are hiding behind other aggregators like Swiggy by wearing clothing with their branding (T-shirts)
This is turning out to be a big problem for law enforcement agencies.

Source:New Indian Express, Bangalore edition 30 July 2019

[albertprince]

Most Rapido riders do not offer a helmet for the pillion here in Chennai even after advertising to do so. It will be really difficult for the police to find these herd as they are not differentiable from normal riders.

[Samurai]

Originally Posted by Mortis

Technically Ola and Uber are also illegal because the driver's use their phones while driving

No, such services come under Radio taxi scheme, where drivers are allowed to use 2-way communication device. Most states have their own implementations.

Delhi (2006)
Karnataka (1998)