Govt permits surge fares of up to 2x base rate for cab aggregators

The Centre on Tuesday permits cab aggregators such as Ola, Uber, and Rapido to charge up to twice the base fare as a surge price during peak hours, up from the previous cap of 1.5 times. During non-peak hours, the fare must be at least 50 per cent of the base rate.

The announcement was made by the Ministry of Road Transport and Highways (MoRTH) in the new Motor Vehicle Aggregator Guidelines (MVAG) 2025. The Centre has allowed the states three months to adopt the revised guidelines.

In the event of any cancellation from the driver's side after accepting a ride, a ten per cent of the fare, not exceeding ₹100, will be imposed, if it is cancelled without any specific reason, MoRTH announced. A similar penalty has also been announced for the passengers for any cancellation without a specific reason.

Cab aggregators have also been mandated to ensure that the drivers have health and term insurance of at least ₹5 and ₹10 lakh, respectively.

The new guidelines also clearly state that the state governments must notify the base fare for different categories of vehicles, which include bike taxis and auto rickshaws, brought under the ambit of the MVAG policy.

On the regulation of the fare, MoRTH stated, "The fare by the State Government for the respective category or class of motor vehicles shall be the base fare chargeable to passengers availing services from the aggregator."

The new guidelines also indicate that any driver who has been onboarded along with the motor vehicle shall receive at least 80 per cent of the fare applicable, including all costs under the driver’s fare and the remaining charges may be retained as the Apportioned Fare by the aggregator. The payment may be settled daily, weekly or fortnightly, but not later than per the agreement between the driver and the aggregator.