Ola Cabs, a leading ride-hailing service in India, has been ordered to offer customers a choice when it comes to refunds. The company will now allow users to select between a cash refund to their bank account or a coupon that can be used for future rides. This decision follows multiple complaints about the company’s previous refund policy, which only offered coupons.
The directive comes from the Central Consumer Protection Authority (CCPA), which issued the order on October 13, 2024. Ola Cabs will now have to comply with customer preferences, ensuring greater consumer rights protection.
The CCPA made it clear that not offering customers a choice of refund method violates consumer rights. By only offering coupons, Ola was essentially forcing customers to use the platform for another ride, which many found restrictive. The CCPA stated, “Whether the customer prefers a refund in their bank account or as a coupon, Ola Cabs must honor that request.”
Key Highlights of the CCPA’s Order:
1.Consumer Rights Violation: The CCPA pointed out that Ola’s previous policy of only offering coupons limits customer choices, forcing them to take another ride instead of giving them the option for a full refund to their bank account.
2.Receipt or Invoice Requirement: The CCPA Chief Commissioner Nidhi Khare has also instructed Ola to provide customers with an invoice or bill for all auto rides booked via their platform. Currently, if a customer requests a receipt for an auto ride, the app declines, citing “changes in auto service regulations.” This refusal will no longer be acceptable.
3.Over 2,000 Complaints Against Ola: By October 9, 2024, the National Consumer Helpline (NCH) had registered over 2,061 complaints against Ola, with the majority involving issues such as higher fare charges at the time of booking and failure to process refunds.
Ola Faces Widespread Criticism
In addition to the refund policy issues, Ola has been under scrutiny for several other reasons. Last week, the CCPA issued a show-cause notice to Ola Electric Mobility for allegedly violating consumer rights, deceptive advertising, and unfair trade practices. The NCH had received more than 10,000 complaints against the company by that point.
While Ola is primarily known as a cab booking service, the company does not own any cars. So how does it generate revenue? The company acts as an intermediary, connecting customers with drivers through its app. Ola earns money by taking a percentage commission from each ride booked on its platform.
In addition to India, Ola operates in Australia, New Zealand, and the United Kingdom. In Australia, Ola is present in seven cities, and the company claims to have 41,000 drivers using its platform. In 2019, Ola even launched auto-rickshaw services in the UK.
