Daybreak - Is Rapido trading passenger safety for growth?

Episode Date: September 7, 2023

Lately, India's bike taxi leader, Rapido, has been in the news for all the wrong reasons. With numerous complaints of sexual harassment, theft, and even impersonation, the startup has been reckless with the safety of its customers, epecially women.Despite these incidents, Rapido still enjoys a 60% share of the bike-taxi market in India. It clocks in as many as 750,000 rides every single day and yet, the level of scrutiny it deploys for the drivers on its platform is close to non-existent.What’s is the bike-taxi not fixing these issues? Tune in to find out.Free ReadHow Domino’s defied the might of Zomato and SwiggyDaybreak is produced from the newsroom of The Ken, India’s first subscriber-only business news platform. Subscribe for more exclusive, deeply-reported, and analytical business stories.

Hi, this is Rohan Dharma Kumar. If you've heard any of the Ken's podcasts, you've probably heard me, my interruptions, my analogies, and my contrarian takes on most topics. And you might rightly be wondering why am I interrupting this episode too? It's for a special announcement. For the last few months, I and Sita Ramon Ganeshan, my colleague and the Ken's deputy editor, have been working on an ambitious new podcast. It's called Intermission.

We want to tell the secret sauce stories of India's greatest companies. Stories of how they were born, how they fought to survive, how they build their organizations and culture, how they manage to innovate and thrive over decades, and most importantly, how they're poised today. To do that, Sita and I have been reading books, poring over reports, going through financial statements, digging up archives, and talking to dozens of people. And if that wasn't enough, we also decided to throw in video into the mix. Yes, you heard that right. Intermission has also had to find its footing in the world of multi-camera shoots in professional studios, laborious editing, and extensive post-production.

Sita and I are still reeling from the intensity of our first studio recording. Intermission launches on March 23rd. To get an alert as soon as we release our first episode, please follow Intermission on Spotify and Apple Podcasts or subscribe to the Ken's YouTube channel. You can find all of the links at the ken.com slash I am. With that, back to your episode. It's easy, it's cheap, and the best part, it gets past the blood-sucking traffic, especially in cities like Bangalore, way quicker than your regular four-wheeler taxi cabs.

I'm talking about Rapido, the pioneer of bike taxis in India. It runs operations in more than 100 cities and clocks over 750,000 bike rides every single day. So it comes as no surprise that the bike taxi startup controls 60% of the market in the country. An average ticket size on the app is just 60 rupees. So you can imagine how accessible that makes Rapido to people from all walks of life, especially women, women who trust the app to take them from point A to point B safely. I mean, that's the least one can expect, right? Yet, if you've heard anything about Rapido lately, it's probably about how it has been letting its women customers down with regards to safety.

In April this year, a woman in Bangalore literally had to jump off a Rapido bike to escape being sexually harassed by the driver. Can you imagine? I'm going to give you some details of the incident, so please take this as a trigger warning. Not only did that driver grope her, he also took her phone away saying that he wanted to see the OTP. A little more than a month ago, in another incident, again in Bangalore, a rapido driver sexually harassed a woman while driving. It was in a secluded area, so the woman couldn't even cry for help. And it doesn't end there. Somehow he even managed to access her phone number and started sending her inappropriate messages on WhatsApp. These are not one-off incidents. Customers have also reported cases of theft

and impersonation by drivers. How is this happening and is Rapido even doing anything to fix this? Welcome to Daybreak, a business podcast from the Ken. I'm your host, Nickda Sharma and I Don't Chase the New Cycle. Instead, thrice a week on Mondays, Wednesdays and Fridays, I will come to you with one business story that is worth understanding and worth your time. Today is Friday, the 8th of September. And what is keeping RAPido from fixing these customer safety issues? My colleague Shavani Varma, a reporter at the Ken, spoke to a bunch of RAPIDO users, drivers and

some industry executives. It all starts with how easy it is to get on RAPDO. Not just for a customer, but even for drivers. Rappado likes to call them captains. All they need to start working as RAPTO bike taxi captains are three documents. A driving license, a vehicle registration certificate or RC, and an Adhahar or Pancard. And a selfie of the rider. That is it.

Nothing else. As soon as these documents are uploaded, the driver can start accepting rides. A driver told us how making a RAPIDO captain buy a driver. ID is a two-minute process. No wait time for documents to be verified. Let's see what other ride-haling apps do in this department. A writer told a ken that Ola's procedure is similar. He said that Ola also asked for police verification when he was onboarded a year ago.

But for Rapido, this condition is entirely missing. But the other four riders that the Ken spoke with said that there is no police verification required for either Ola, Rapido or Uber. Now, it is possible that these drivers were not aware of these authentications, which is if they are happening at all. But Chivani spoke to an executive from the industry who told her that Uber does do background checks, including police verification, through a third party. An Uber spokesperson told us that they regularly carry out these processes to uphold safety standards.

The verification process at Uber takes a day to complete across all vehicle categories, and that is their global policy. So if you compare the three bike taxi apps, it does seem like Uber has the most strict rules. But at Rapido, well, a rider told us that the level of scrutiny is barely existent. Stay tuned for more on this, but before that, my colleague Aksha has a message for you. I don't know about you, but I often turn to Swiggy when I don't know what to order. But if I know that I want pizza, then I go directly to the Domino's app. Daily offers, 30-minute delivery, super-functional interface.

The Domino's app is just better for pizza delivery. I'm guessing many of you are nodding in agreement. Well, not just you and me, even the numbers speak for themselves. The Domino's app contributed to more than half of Domino's total sales, in the final quarter of 2020. The app is so good, Patrick Doyle, the company CEO between 2010 and 2018, is quoted as having said, Domino's is a technology company that delivers pizza.

This assertion could not be more true in India. Zomato and Swiggy, the two food delivery platforms worth billions, have not been able to convince most of their users to order a Domino's pizza from their apps. What is the secret source? How did Domino's manage to retain its relative independence from Zomato and Swiggy? Why has no other brand been able to do this? Well, you'll have to read the story to find out. This story written by the Ken's staff writer Sita Raman has been made available for free for exactly 24 hours,

just for today the 8th of September. So go ahead, give it a read and share away with your friends before the counter runs out. I am Akshya from the Ken's Newsroom. Thank you for listening to us. If you like what we do, please rate and review us wherever you get your podcasts. And now, back to Snigda. Rider told Shivani, and I'm quoting, sometimes captains even upload somebody else's vehicle registration certificates and get their documents approved. They also explained how riders exploit loopholes. Some of them joined the platform with an electric vehicle or EV, which does not require a driving license. It is only later that they upgrade their ID to use a petrol vehicle and bypass the rule altogether.

Another rider who worked with all three platforms said that it is quite easy to use someone else's RAPido or OLA account by accessing their phone number and one-time password. In the case of Uber, they said it requires them to add their photo while logging in. This step does not exist in Rapido and Ola. Also, RAPIDO does not ask for routine verifications or upgradation of documents once a captain or a driver has onboarded the platform. At least OLA verifies the documents every once in a while. The next thing is the training module.

Most ride-haling apps require their drivers to go through a bunch of training videos that tell them about safety protocols, how to use the app, how to behave, etc. But out of the four Rappado drivers that the Ken spoke with, only one who joined the platform last year knew about these video tutorials. Others did not even know that they exist. Then there comes the issue of phone numbers. Remember the incident I mentioned where the Rappado driver was calling and sending inappropriate messages to a woman?

How did he get her number? Rappado claims that every woman customer's contact number is masked to protect their privacy and their interaction with the driver or the captain happens only through app encryption. The Ken checked with 10 people to see whether they received a centralized number when calling a driver. Out of the 10, 6 of the users were women. Three out of the four men got the personal number of the captains. And for women, all but one got a centralized number while calling the driver. So why doesn't this feature work all the time for every customer?

customer, irrespective of their gender. Digital rights activist and researcher, Srinvas Kodali, told Shivani that there is a cost involved in using third-party services to root calls between drivers and customers. He said that if a customer calls the rider directly, Rapido has no cost. So it could be because it wants to save money. In early July, Rapidu introduced night checks for rides between 10 at night and six in the morning.

Through this, they were supposed to call to make sure that the customer had reached their destination safely. But the customers told us that these calls come so late that it doesn't even make sense. The loopholes are endless. Coming up next, we speak about the existing regulations, or actually the lack of them. We spoke to Janali Dani, a senior resident fellow at Vidhi's Centre for Legal Policy. Dani told us that across India, ride-haling apps are not regulated properly. We have the Central Motor Vehicle Aggregators Guidelines of 2020,

which requires states to come up with their own motor vehicle aggregator regulations. But guess what? It is only now that the states are beginning to come up with such rules. And in the absence of comprehensive rules and a uniform policy, there will be instances of some states making bike taxi operations, legal or illegal. As of 2018, only 13 states in India allowed bike taxis to operate. In some cases, bike taxis carry on despite a ban, for example, in Delhi.

Basically, the point is that there is no formal framework to report safety-related problems, especially for bike taxi apps like Rapido, which run private two wheelers with white number plates for commercial purposes. Rapido might be relying on its giant share of the market right now, but that advantage is not going to last forever. The only way that it can maintain its lead is if it stops cutting corners when it comes to the safety of its customers, especially women customers. Daybreak is produced from the Newsroom of the Ken, India's first subscriber-focused business

news platform. What you're listening to is just a small sample of our subscriber-only offerings. A full subscription unlocks daily long-form feature stories, newsletters, subscriber-only apps and podcast extras. Head to the ken.com and click on the red subscribe button on the top of the website. I am Snigda Sharma, your host and today's episode was edited by my colleague Rajiv Sien.