Cab aggregator guidelines 2025: Users brace for costlier rides, amid safety reforms

In a move that could significantly impact urban commuters across the country, the ministry of road transport and highways has issued the Motor Vehicles Aggregator Guidelines (MVAG) 2025, permitting cab aggregators to charge up to twice the base fare during peak hours.

This is a steep increase from the earlier cap of 1.5 times that operators such as Ola, Uber, and Rapido charge. While the Centre touts the move as a way to bring “flexibility” during high-demand periods, users fear it may end up hurting their wallets.

The new national policy, announced on 1 July 2025, has sparked concern among daily commuters who are already grappling with inflation and rising transportation costs. Critics argue that the decision could make cab rides prohibitively expensive during rush hours and festive periods, particularly in cities where public transportation remains patchy or unreliable.

Notably, the policy is non-binding, with states given a three-month window to implement the revised guidelines. Maharashtra, for instance, has chosen to diverge from the Centre’s direction by capping surge pricing at 1.5x, while permitting off-peak discounts of up to 25 per cent to encourage ridership.

The state’s Aggregator Cabs Policy 2025 also introduces stricter norms for safety and accountability — an area where many ride-hailing platforms have previously come under fire.

For users, the central guideline’s leniency on surge pricing raises key questions about fairness and affordability.

“The last thing commuters need is another hike in cab fares. What’s the point of regulation if it only benefits aggregators?” asked Prerna Shah, a marketing executive in Mumbai who relies on app-based cabs for daily travel.

Consumer rights groups are particularly vocal about the absence of a national fare ceiling, fearing that it gives platforms too much control over dynamic pricing. The flexibility granted to aggregators may end up exacerbating fare fluctuations, especially during emergencies, weather-related disruptions or public transport strikes.

On the positive side, the Maharashtra policy has already introduced robust safety features, including live GPS tracking, verified driver profiles and in-app emergency buttons — but these already existed on several larger platforms as default, nationwide.

The inclusion of optional women-only rides has also been welcomed by female commuters. However, some question whether these measures —while necessary — are being used to justify the controversial surge fare revisions.

The guidelines also address frequent cancellations by introducing penalties for both drivers and passengers. While this aims to improve service reliability, users say implementation and fairness remain to be seen. “Will the system be smart enough to distinguish between a genuine cancellation and a network glitch?” questioned Rahul Iyer, a Pune-based IT consultant.

Another contentious inclusion is the legalisation of private motorcycles for passenger use, pending state approval. While this could potentially improve last-mile connectivity, it also raises safety and insurance concerns. Critics argue that placing the onus on state governments to regulate such services could lead to inconsistent implementation, especially in states with limited infrastructure or regulatory capacity.

Under both central and state policies, cab aggregators are required to maintain local offices, ensure regular vehicle inspections and provide driver welfare schemes such as insurance and training. Yet, users point out that there is no formal mechanism to audit aggregator compliance or ensure transparency in fare algorithms.

“It’s not enough to regulate drivers and passengers. Aggregator platforms themselves need stronger oversight,” said a member of the All-India Commuters’ Forum. “Who’s watching the companies that are watching us?”

While MVAG 2025 marks a long-awaited move toward regulating India’s app-based transport sector, its real-world impact on users remains debatable. The increased surge pricing cap may offer operational relief to aggregators, but without stringent fare monitoring and uniform state-level adoption, it risks alienating the very commuters it aims to serve.

In the race to modernise urban mobility, the Centre’s latest guidelines may be setting the stage for a more structured ecosystem — but it’s the daily user who could end up paying the price.