Consumer rights watchdog directs Ola to scrap advance tipping feature, imposes Rs 10 lakh penalty

The Central Consumer Protection Authority on Tuesday imposed a penalty of Rs 10 lakh on cab aggregator Ola for misleading customers into paying extra to improve their chances of securing a ride.

It directed the company to discontinue the advance tipping feature and remove prompts that encouraged customers to make additional payments before a driver accepted their booking.

The consumer rights watchdog said the feature amounted to misleading advertising, an unfair trade practice and an unfair contract under the 2019 Consumer Protection Act.

The action followed a complaint filed in May 2025 against the feature, which suggested that paying extra could help customers secure a ride faster.

The app displayed the message: “Adding a tip might help increase the chances of getting a ride faster.”

Customers were initially offered pre-set amounts ranging from Rs 10 to Rs 40, which later increased.

The consumer right authority found that the ride-hailing application allowed additional payments of up to Rs 499.

Ola defended the feature saying that the payments were voluntary and transferred directly to drivers without any deduction by the platform. It argued that the option helped drivers accept rides that might otherwise be commercially unviable, particularly when they had to travel a longer distance to reach a passenger.

The company maintained that paying extra did not guarantee faster booking confirmation, but said that “the chances do increase”.

However, the consumer rights watchdog found that Ola’s own data did not support its claims. In Delhi, around 38% of ride requests with an additional payment were accepted, compared with 62% of requests without one. In Bengaluru, the acceptance rates were 40% for rides with an add-on and 68% for those without.

The authority also pointed to a contradiction in Ola’s arguments.

“‘Adding a tip might help increase the chances of getting a ride faster’ contradicts its submission that the add-on does not result in a priority ride,” the order said.

It held that the feature was misleading either way. If the additional payment did not influence driver acceptance, the claim that it improved the chances of securing a ride was false. If it did influence acceptance, customers who did not pay extra were placed at a disadvantage.

The authority also rejected Ola’s argument that the payment was simply a voluntary tip, noting that tips were given in appreciation of services already provided, whereas the platform sought the additional payment before a driver had accepted the booking.

“A dark pattern does not cease to be one because it does not succeed with every consumer and a feature used by over one lakh ride requests in a single city cannot be described as insignificant,” the order said.

The authority directed Ola to stop using prompts, messages and interface designs that could “solicit, nudge, coerce or psychologically pressure consumers into paying any amount”.

Ola has been directed to submit a compliance report within 15 days.

Written by Sara Varghese. Edited by Nachiket Deuskar.