The Ministry of Road Transport and Highways (MoRTH) has issued the revised Motor Vehicle Aggregator Guidelines, 2025, introducing significant changes to the operations and pricing structures of cab aggregators such as Ola, Uber, and Rapido across India.
These guidelines aim to regulate the sector with a focus on passenger safety, driver welfare, and business viability for aggregators.
Under the updated regulations, cab aggregators are now permitted to charge up to twice the base fare during peak or rush hours and in adverse weather conditions. This represents an increase from the previous cap of 1.5 times the base fare under surge pricing.
Conversely, during non-peak hours, aggregators are mandated to charge a minimum of 50% of the base fare. State governments will retain the authority to determine the base fare for different vehicle types and have been urged to implement these changes within three months.
The guidelines also address "dead mileage," which refers to the distance and fuel consumed by drivers to reach a passenger's pickup point. The base fare is now stipulated to account for a minimum distance of 3 kilometres to compensate for this.
Passengers will not incur a separate charge for dead mileage unless the total trip distance is less than 3 km. For trips exceeding 3 km, the fare will apply solely to the distance between the pickup and drop-off points.
For drivers operating their own vehicles and affiliated with aggregators, the new rules mandate a minimum earning of 80% of the total fare collected, with aggregators retaining the remaining 20%.
Payment settlements can be conducted daily, weekly, or fortnightly, based on mutual agreement. In cases where vehicles are owned by the aggregator and driven by hired drivers, the driver is entitled to at least 60% of the collected fare, while the aggregator may retain up to 40%.13
New cancellation rules have also been introduced. A penalty of 10% of the fare, capped at ₹100, will be imposed if a driver cancels a ride after accepting it without a valid reason. The same penalty applies to passengers who cancel rides without a valid reason. The cancellation fee collected from passengers will be distributed between the driver and the aggregator, adhering to the specified fare-sharing norms.
These revised guidelines represent a significant update since the initial Motor Vehicle Aggregator Guidelines were introduced in 2020 under Section 93 of the Motor Vehicles Act, 1988, which established a regulatory framework for state governments to license and regulate cab aggregators.