The policy and social innovation unit of the SoftBank-backed taxi and bicycle reservation company, Ola Mobility Institute, has suggested state governments classify bicycle taxis as transport vehicles in order to legitimize bicycle taxi activities in India and allow new MSMEs and large companies to emerge. . “This would encourage the availability of large fleets of bicycles for sharing in a city, as well as the emergence of such on-demand two-wheeler businesses of all sizes – micro, small, medium and large,” he said. ‘institute. said in a report on the importance of bicycle taxis in India and their economic potential. Ola is currently competing with other major players such as Uber Moto and Rapido in the bicycle taxi segment.
The bicycle taxi segment in India is currently stuck due to a lack of legal clarity as many state governments have not notified their policies on this matter. This could be due, firstly, to “the lack of precedence resulting from the technical and legal uncertainty regarding the classification of bicycles as a transport vehicle, i.e. vehicles which engage in commercial operations and are usually identified by a yellow registration, “and second,” lack of clear evidence of the positive impact of bicycle taxis in Indian cities, “said the report titled The Power of Two Wheels.
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However, the Ministry of Road Transport had declared that the authorization of bicycle taxis was legal. “Under the Motor Vehicle Act 1988, states can issue taxi permits under sections 72 and 73. Therefore, it is legal for states to issue taxi permits for all kinds of vehicles. including two-wheelers, ”Ministry of Transportation and Highways MoS Mansukh L Mandaviya had told Lok Sabha in December 2018 in response to a question of whether bicycle taxis were legal in 14 states. Currently, only 13 states and Union territories have defined rules for bicycle taxi companies.
Ola also suggested that banks switch from asset-based loans to cash-flow-based loans to enable people to buy bikes through bank loans without giving any collateral and to earn a living. These unsecured loans to first-time borrowers entering the bicycle taxi economy “can be classified as priority sector loans,” Ola said. To offer loans, banks and microfinance institutions can use “the data available through digital transactions to profile the social and economic context of borrowers”. Bike taxis in India have the potential to generate over 2 million livelihoods and income of $ 4-5 billion, while the industry is expected to reach $ 90 billion by 2030.