Ola Extends Zero Commission Model to Cab Drivers After Autos

Ride-hailing platforms in India have been choosing the alternate route of “zero commission model”. Instead of taking a cut from every ride, they are now moving on to subscription-driven models. Months after Uber, Ola has also rolled out a flat-fee subscription model for its cab drivers, as per Mint report.

This is not the first time that Ola and Uber have implemented this model, previously, the duo piloted it last year only for auto-rickshaws. But this year, Uber adopted the zero commission model even for cabs, with Ola now following the footsteps.

In this model, no commission fee is charged. Instead, a one-time fee or subscription fee applies, either on a daily basis, monthly, or annually. For example, Rapido’s subscription fee ranges from ₹9 to ₹29 per day. Namma Yatri charges ₹90 per day, irrespective of the number of rides.

Ola now offers a 30-day subscription at ₹67 per day, granting drivers full platform access without any commission deducted from their rides, the report said.

On the other hand, cab aggregators generally charge a commission fee of around 20-40% from drivers. This move echoes the strategies of newer players like Rapido and Namma Yatri, which launch SaaS-style models --- charging drivers a fixed daily or monthly fee so thet can retain 100% of their earnings.

Beyond The Rides

The zero-commission model, however, is not confined only to the ride-hailing space. Several mutual fund platforms, discount brokerages, and e-commerce platforms are also using zero commission models. 

ONDC has also adopted the zero-commission approach in the mobility sector to boost driver earnings by approximately 30%—thanks to drivers retaining their full fares after paying just a flat daily or monthly fee—when compared to traditional commission-based platforms.

Meesho also claimed to be the first e-commerce platform to introduce a zero-commission model. In 2021, the platform introduced this model to encourage sellers to invest their capital more efficiently rather than spending a significant portion on commissions. 

In addition, at-home salon platform YesMadam has introduced a 0% commission model for its top-performing service professionals in April this year. The company is not taking a commission from earnings of select gig workers who meet internal performance criteria.

Previously, the platform reduced commissions from 20% to 15%, and then to 8%, over the past few years.