Central Consumer Protection Authority directs Ola to develop mechanism providing choice to consumers regarding refund mode

In a landmark decision, the Central Consumer Protection Authority (CCPA) has directed Ola, a leading online ride-hailing platform, to implement a mechanism allowing consumers to choose their preferred method of refund—either directly to their bank account or via coupon—during the grievance redressal process. Additionally, Ola has been instructed to provide consumers with a bill or receipt or invoice for all Auto rides booked through its platform, ensuring greater transparency and accountability in its services. The Authority is headed by Chief Commissioner Smt. Nidhi Khare.

CCPA observed that the whenever consumer raised any grievance on the Ola app, as part of its no-question-asked refund policy, Ola only provided a coupon code which could be used for the next ride without providing an clear choice to the consumer to opt between a bank account refund or a coupon. It was observed that this violates consumer rights and the no-question-asked refund policy cannot mean that the company incentivises people to simply use this facility for taking another ride.

Further, CCPA observed that if a consumer attempts to access invoice for Auto rides booked on Ola, the app shows the message ‘Customer invoice for Auto rides will not be provided due to changes in Ola’s auto service T&Cs.’ It was observed that not issuing bill or invoice or receipt for the goods sold or services rendered constitutes an ‘unfair trade practice’ under the Consumer Protection Act, 2019.

2. Definitions.

(47) “unfair trade practice” means a trade practice which, for the purpose of promoting the sale, use or supply of any goods or for the provision of any service, adopts any unfair method or unfair or deceptive practice including any of the following practices, namely:—

(vii) not issuing bill or cash memo or receipt for the goods sold or services rendered in such manner as may be prescribed.In addition to the above, CCPA’s intervention has led to the following consumer-centric changes in the Ola app –

1. Previously, no details of Grievance officer and nodal officer were prominently visible on the website. Now, Name, Phone number and e-mail of Grievance officer and nodal officer are mentioned, in Support section of website.
2. Permitted time of cancellation as per cancellation policy, now prominently displayed at the time of booking ride.
3. The amount of cancellation fee amount is now clearly mentioned on the ride booking page, so that the consumer is clearly aware of the amount which could be charged on cancelling the ride before she/he proceeds to cancel.
4. New acceptance screen added for drivers where address of both pickup and drop location is shown to drivers.
5. In order to avoid inconvenience and confusion, more reasons added against which consumer wishes to cancel ride.
6. List of components that constitute the total fare added now publically available such as base fare, per km fare, pre-wait charges etc.
7. Communications issued to drivers to encourage taking digital payments and switch on AC.
8. Revised payment cycles for drivers so that they get payment swiftly.

As per information on the National Consumer Helpline (NCH), a total of 2,061 complaints have been registered against Ola from 01.01.2024 to 09.10.2024. The top categories of complaints include –

1. Higher fare charged from consumer than what was shown at the time of booking the ride
2. Non-refund of amount to the consumer
3. Driver asking for extra cash
4. Driver did not reach the correct location or dropped at incorrect location

Through its regulatory intervention, the CCPA has been steadfast in ensuring that Ola adheres to the legal framework established to secure the rights of consumers. These measures aim to empower consumers, enhance trust, and improve service provider accountability, reflecting the CCPA’s commitment to ensuring a fair and secure experience for all consumers on e-commerce platforms.