The central government has announced new regulations under the 'Motor Vehicles Aggregator Guidelines 2025' that are expected to reshape the operations of cab aggregators like Ola, Uber, and Rapido.
These guidelines, issued by the Ministry of Road Transport and Highways, advise states to adopt the revised norms within the next three months.
Here are five key points from the new guidelines that could impact both passengers and drivers:
- Surge Pricing Increased: Cab aggregators can now charge up to double the base fare during peak hours (previously 1.5 times).
- Minimum Fare During Off-Peak: A minimum of 50% of the base fare can be charged during non-peak hours.
- Minimum Distance for Base Fare: The base fare must cover a minimum distance of 3 kilometres.
- Fairer Driver Compensation: Drivers owning their vehicles must receive at least 80% of the total fare collected; aggregator-owned vehicle drivers must get at least 60%.
- Both Drivers and Passengers Face Cancellation Penalties: The government has also set new rules for cancellations. If a driver cancels a ride after accepting it without a valid reason, a penalty of 10 per cent of the fare - up to a maximum of Rs 100 - will be charged. The same rule applies to passengers who cancel a ride without a valid reason.
Meanwhile, India's ride-hailing and bike-taxi industry has welcomed the government's new Motor Vehicle Aggregator Guidelines (MVAG) 2025, calling it a major step toward regulatory clarity, innovation, and expanded affordable mobility across the country.
The Ministry of Road Transport and Highways on Tuesday issued the Motor Vehicle Aggregator Guidelines (MVAG) 2025, providing long-awaited regulatory clarity for India's shared mobility sector by officially permitting states to allow the use of non-transport (private) motorcycles for passenger rides through aggregator platforms.
This move brings relief to bike taxi operators like Rapido and Uber, who have long operated in a legal grey area, especially in states like Karnataka, where a recent ban on bike taxis had led to increased tensions and widespread protests. Major industry players, including Uber and Rapido, have welcomed the move, acknowledging its potential to drive innovation, expand affordable mobility, and create new livelihood opportunities.
(With inputs from PTI)
