The Ubers and Olas may have disrupted the taxi-hailing market in India with their mobile app-led business model but it is the cab drivers affiliated to such services that are riding the wave, many of them earning anywhere between Rs 75,000 and Rs 1 lakh per month.
Take the case of Lokesh R in Bengaluru. His income, he says, goes up to as much as Rs 1.25 lakh in some months. “On an average I earn around Rs 80,000 per month and if there is some luck on my side in terms of faster pick-up, my earnings can beyond Rs 1 lakh,” he said. Before the advent of these taxi-hailing services he was making somewhere around Rs 15,000-20,000 a month.
Talking to FE, TaxiForSure CEO Arvind Singhal said there has been a socio-economic transformation. “We have so many educated people approaching us to become cab drivers. We even have an engineer contracted with us as a driver, who says he loves the entrepreneurial mindset associated with the profession as compared to some IT job.” Singhal said.
Online taxi aggregators like Uber, Ola and TaxiForSure have brought in a sea change to the India cab services market driven by mobile app technologies and highly competitive rates. Ola, which is currently valued at $2.5 billion, started its operations four years ago and is currently present in over 100 cities.
Uber, the hottest start-up globally, valued above $50 billion, started its Indian operations in August 2013 and is currently present in 11 cities. The global giant has started accepting cash payments on a trial mode in India, something it has never done globally, seeing the kind of demand here.
The taxi market in India is estimated to be around Rs 11,000 crore, and growing in double digits. And the driver is a key, well, driver of business. The remuneration paid to these drivers by the online players is fairly straightforward.
In the case of Uber, for every trip made, the driver receives 80% of the fare, which is credited to the bank account.
There is also a bonus payment of Rs 150 per trip for rides made during peak hours and Rs 50 during non-peak hours. Ola even provides a bonus to drivers if they do six trips a day. TaxiForSure charges the driver only 8-12% of the ride fee, in a bid to attract more drivers.
Basavaraj, who came to Bengaluru around five years ago leaving behind a rural background burdened with family debts, is today a happy man having cleared off his loans. “I bought this taxi under Ola’s financing scheme where the vehicle is attached for a particular number of years,” he said.
However, the job has its associated pressures. Said Lokesh, “It is almost impossible to stay away from our phone, as one never knows when our next call is going to come. The demand never stops.”
While that may lead to family issues, TaxiForSure’s Singhal says even the wives of these drivers have joined in the business. Many of them track the movement of the cabs on GoogleMaps and coordinates with the drivers. “It’s a big high for people like us to see our drivers do so well. They have become mini-entrepreneurs, said Singhal.
“I see this trend picking up even further. More and more educated professionals may join the ranks,” he added.