Policy on app cabs moots penalties, price caps

Mumbai: The state cabinet on Tuesday gave its nod to a new policy to regulate the activities of app-based taxi aggregators. The policy, framed following a directive from the Supreme Court, allows for levying of penalties on both drivers and passengers for cancellation of rides without valid reasons. It also caps surge pricing at 1.5 times the base fare and encourages electric vehicles and car-pooling.

The policy is based on recommendations of a committee led by retired IAS officer SK Shrivastava. The committee was appointed by the state government following a February 2023 Supreme Court order and it submitted its report in April 2024.

The policy mandates that all aggregators must have an office in Maharashtra, install GPS tracking systems on vehicles, check the credentials of drivers before recruitment, train drivers during renewal of their driving licenses, provide insurance cover to all drivers and passengers, and have a robust grievance redressal mechanism.

Aggregators would also have to adhere to fares finalised by regional transport authorities, subject to a maximum reduction of 25% during non-peak hours and a maximum hike of 50% (or 1.5 times) during peak hours.

Both drivers and passengers would be subject to penalties in case they cancel rides without valid reason, the policy notes. Drivers would have to pay 10% of the fare or ₹100, whichever is lesser, and the amount would be credited to the passenger’s account. Similarly, passengers would have to pay 5% of the fare or ₹50, whichever is lesser, and the amount would be credited in the driver’s account.

The policy encourages car-pooling but clarifies that women passengers would be able to avail the service only when the vehicle is driven by a woman.