Rapido introduces subscription fee model for auto taxi drivers

In a bid to attract more offline auto drivers, Bengaluru-based ride-hailing company Rapido today has launched a subscription fee model for three-wheeler taxi service drivers on its platform. This replaces its existing model of levying commission on each ride.

“We are changing the business model into a SaaS model where we are giving our product as a service and asking the driver to just pay an access fee of as low as Rs 9 to use the product. And they can use it as much as they want. So now whether a driver does 5 or 10 rides, whether they earn Rs 100 or Rs 1,000, they just need to pay a simple access fee,” said Rapido co-founder Pavan Guntunpalli.

Rapido has been piloting this subscription fee model for autos in some select markets. The new model will be rolled out to three-wheeler drivers across the country from now. Rapido will charge a subscription, or logging, fee in the range of Rs 9 to Rs 29, depending on the city.

With offline rides accounting for around 90% of auto rides in the country, Guntunpalli sees a huge potential for growth in three-wheeler taxi service in the country. Currently, Rapido has a market share of around 25% in the three-wheeler ride-hailing space.

Rapido has been popular for its budget-friendly two-wheeler services. For two-wheeler drivers, the company charges a commission on each ride, “Since there are a lot of part-time drivers in the two-wheeler service who do two or three rides a day, our understanding is that having a subscription or access fee might be detrimental,” Guntunpalli added.

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In December, Rapido also launched its cab service in major cities across the country through the subscription fee model, where drivers will have to pay a subscription fee on certain earnings milestones. Rapido’s can service is now available in around 35 major cities.

Guntunpalli believes its software as a service model can help the company onboard a significant number of drivers onto its platform, citing better earnings.

The challenges faced by auto drivers and customers

The auto taxi business has long been a crucial mode of transportation in many cities, providing convenient and affordable rides to millions of commuters every day. However, both auto drivers and customers have faced their fair share of challenges in this industry.

For auto drivers, one of the major challenges is the inconsistent income. Due to factors like fluctuating demand, competition, and lack of fixed routes, auto drivers often struggle to earn a stable income. They may have to spend long hours waiting for passengers or end up traveling long distances without any fares. Moreover, the bargaining culture prevalent in the industry adds another layer of difficulty for auto drivers to earn a fair wage for their services.

On the other hand, customers also face challenges when it comes to hailing autos. Finding an available auto during peak hours or in remote areas can be a daunting task. Additionally, many customers have experienced issues with overcharging, refusal to go to certain destinations, or poor service quality.

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These challenges have created a need for innovative solutions that can address the concerns of both auto drivers and customers. Rapido, a leading player in the auto taxi industry, has taken a bold step by introducing a game-changing subscription fee model. This model aims to revolutionize the way auto rides are availed and paid for, providing benefits to both drivers and customers.

In conclusion, Rapido's subscription fee model has disrupted the auto taxi business, providing a win-win solution for customers and drivers. With its convenience, affordability, and potential for expansion, Rapido is set to shape the future of ride-hailing services and pave the way for more innovative approaches in the industry.