Uber trials cash payments in India

Move aimed at expanding company's addressable market in country, which has low credit card penetration

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Uber trials cash payments in India Uber had struggled to adapt its online-only business model to India's specific needs (Getty Images)
By  Tom Paye Published  May 12, 2015

Uber is trialling cash payments in India, a country with strong internet penetration but fewer credit and debit card users, in the hope of gaining a stronger foothold in the region, according to Reuters.

The news outlet quoted analysts as saying that Uber had struggled to adapt its online-only business model to India's specific needs. This was cited as a reason that Uber has struggled against Indian rival Ola, which accounts for around 80% of the country's organised taxi market, Reuters said.

India has around 20m credit cards spread across a population of about 1.3bn, meaning that Uber, which has traditionally relied solely on online payments, has a small addressable market in the country. The ability to pay Uber cabs in cash would help it serve more customers, who generally pay for things in cash, despite government drives to get people to switch to cards.

"Tradition dictates that cash plays a big role for Indian consumers," Reuters quoted Siddharth Shanker, Uber's general manager in Hyderabad, as saying.

Ola has always accepted cash payments for cabs, and traditional hailed taxis and rickshaws in India deal only in cash.

Despite seeing troubles in India, Uber has some support from the country's transport ministry, Reuters said. The company has been banned from New Delhi since December, following a rape case being brought against one of its drivers, though the company continues to expand in the rest of India.

It is not expected that Uber will extend the cash payment option to more developed markets.

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