Last week, India’s consumer protection watchdog issued a notice to global ride-hailing giant Uber, asking for an explanation for its “Advanced Tip” feature.
Pralhad Joshi, the Union Minister for Consumer Affairs, also called the practice “deeply concerning” on social media. “Forcing or nudging users to pay a tip in advance, for faster service is unethical and exploitative. Such actions fall under unfair trade practices. Tip is given as a token of appreciation not as a matter of right, after the service,” Joshi said, adding, “Fairness, transparency and accountability must be upheld in all customer interactions.”
He said the Central Consumer Protection Authority (CCPA) is also investigating other ride-hailing apps, including Ola and Rapido. They will be served notices if found to be indulging in such practices.
What is an advanced tip?
When a user requests a ride on Uber, the app prompts the user to “Add a tip for faster pickup”. “A driver may be more likely to accept this ride if you add a tip. Your driver receives 100% of the tip. If you add a tip now, you can’t change it later,” it says.
Rapido, an Indian app, similarly urges users to increase the ride fare, saying the available drivers are not accepting a ride at the current price. Ola also tells users that their chances of getting a ride more quickly may increase if they add a tip.
When and why did companies start this feature?
Namma Yatri, which is backed by the government initiative Open Network for Digital Commerce, was the first to start this feature in 2022, and Rapido implemented it in 2023. Uber announced it in November last year and implemented it in April 2025.
Companies don’t have to pay 5% GST on the tip (which aggregators have to pay for passenger services otherwise), so they get drivers to earn more through this feature. “To avoid an unfair advantage, all players eventually moved to this model,” according to an industry source. “Offering drivers tips upfront has thus become an industry norm, with different names,” the source added.
“This option of adding extra fare is a transparent way of informing the Customer about any probable surge pricing which may get activated if demand is high in that particular area. However, this is completely optional and only gets applied when a customer chooses to do so,” a Rapido spokesperson said.
The Indian Express earlier reported that following the Centre’s action, Namma Yatri recently renamed its “add a tip” option as “add more (voluntary)” to find a ride. The company also defended its policy, saying customers are given the option only after no driver accepts the ride request within 30 seconds.
What are the concerns around upfront tipping?
According to Shivam Singh, an Advocate at the Supreme Court who practises in consumer protection litigation, “Upfront tipping institutionalises practices such as haggling with auto drivers on the road, which people were looking to escape by using such apps. While it is shown as discretionary, that discretion gets skewed if you tell a user that someone else might get that cab if you don’t tip the driver now.”
He added that the practice “is something that appears coercive”, and that “It does look like an unfair trade practice under the Consumer Protection Act of 2019.” Under the Act, unfair methods employed to promote the sale of an item include false representations about its quality and quantity, among other things.
Could this be a type of dark pattern?
The issue highlights “dark patterns”, often used by companies to influence consumer behaviour in their favour. Design patterns (such as user interface/user experience) are built to mislead or trick users into doing something they originally did not intend or want to do.
The CCPA also issued guidelines in 2023, aimed at regulating and prohibiting dark patterns. One such tactic listed in the guidelines is false urgency. It refers to falsely stating or implying a sense of urgency or scarcity to mislead a user into making an immediate purchase, or taking immediate action that may lead to a purchase. It can include presenting false data on high demand without appropriate context, like saying, “Only 2 rooms left! 30 others are looking at this right now.”
Another category of such practices is drip pricing, where elements of prices are not revealed upfront or revealed surreptitiously within the user experience. For example, the price of an aeroplane ticket at the checkout may be a certain amount, but a higher price is charged when making the payment.
In 2024, the Advertising Standards Council of India analysed around 12,000 screens from 53 apps across nine industries, identifying an average of 2.7 deceptive patterns per app. It included apps like Ola, Uber and Rapido, and found that 32% of surveyed companies showed instances of false urgency, and 42% engaged in drip pricing.
The Central Consumer Protection Authority (CCPA) is also investigating other ride-hailing apps, including Ola and Rapido. (Express file photo by Pradip Das) 
Share
