Ola, Uber New Rules: From 2x surge pricing to 10% cancellation charges — 5 things passengers and drivers must know

The Centre has notified a new set of rules under the ‘Motor Vehicles Aggregator Guidelines 2025’ for cab aggregators like Ola, Uber, Rapido and others, which may change the way you ride cabs.

The Ministry of Road Transport and Highways, in its guidelines, has advised states to adopt the revised norms within three months.

Here are 5 key points from the new ‘Motor Vehicles Aggregator Guidelines 2025’ that may affect passengers and drivers.

1. Pay 2x surge pricing

Your daily commute to office or journeys during peak hours are set to cost extra as the government has permitted Ola, Uber, Rapido and other cab aggregators to charge 2x surge prices during these periods.

The Centre said that “the aggregator shall be permitted to charge a minimum of 50 per cent lower than the base fare and a maximum dynamic pricing of two times the base fare specified under sub-clause (17.1)”, it said.

2. Drivers to pay for cancelling rides

Amid a surge of complaints from customers over Ola, Uber and Rapido drivers cancelling rides repeatedly, the government has recommended that a 10 per cent fee not exceeding ₹100 should be paid by the driver in case they choose to cancel without valid reasons.

“In case of cancellations, a penalty of 10 per cent of the fare not exceeding ₹100, shall be imposed on the driver, if the cancellation is made without a reason identified as valid by the aggregator,” according to the new rules.

3. Passenger safety moves

To ensure passengers safety, cab aggregators have been asked to ensure installation of the Vehicle Location and Tracking Devices (VLTD) in vehicles and to make sure that Vehicle Location and Tracking Devices are functional all the time. that the driver follows the route indicated in the App.

Aggregators have been asked to ensure that drivers follow the route visible on the app through an in-built mechanism. It added that “in case of any deviation, the App shall signal the control room, which shall then connect with the driver and the passenger immediately”.

4. Compensation for drivers

The latest guidelines for Ola, Uber, Rapido and other aggregators also mandate that drivers recruited by the companies receive at least 80 per cent of the fare.

“The driver onboarded along-with the motor vehicle with the aggregator shall receive at least 80% of the fare applicable including all cost under driver’s fare and the remaining charges may be retained as the Apportioned Fare by the aggregator,” the memo said.

The payment can be settled daily, weekly or fortnightly but not later as per the agreement between the driver and the aggregator, it said.

5. Compulsory health and term insurance for drivers

Aggregators have been mandated to ensure that drivers have health and term insurance of at least ₹5 lakh and ₹10 lakh, respectively. Companies like Ola, Uber and Rapido have been asked to —

• “Ensure a health insurance for not less than ₹5 lakh for each driver on-boarded, which shall be increased each year by such percentage as notified by the Central Government.”
• “Ensure a term insurance for not less than ₹10 lakh for each driver on-boarded, which shall be increased each year by such percentage as notified by the Central Government.”