Ola has rolled out a zero commission model for its cab drivers, adopting a subscription-based approach that mirrors trends set by emerging platforms such as Rapido and Namma Yatri. This strategic move, according to industry insiders, is intended to retain drivers, reduce cancellations, and strengthen Ola’s position in the increasingly competitive ride-hailing space.
What’s Changing for Drivers?
Under the new model, drivers will no longer pay commissions to Ola for each ride. Instead, they can purchase a 30-day pass priced at ₹67 per day, which grants them full access to Ola’s platform with no deductions from their earnings. This shift allows drivers to keep 100% of their fares, making their earnings more predictable.
The new model builds upon Ola’s earlier shift for auto-rickshaw drivers, introduced in April 2024, and reflects a wider industry trend toward Software-as-a-Service (SaaS)-style models. These systems allow drivers to pay a fixed platform fee instead of surrendering a portion of every ride’s fare.
Why This Move Matters
Industry experts view this as a driver-friendly reform that addresses long-standing concerns about fluctuating commission rates.
“This is a significant win for drivers, who generally prefer a fixed subscription model that lets them retain 100% of their fares, rather than dealing with unpredictable commissions. It could also help reduce ride cancellations and driver churn,”
said Nikhil Dhaka, Vice President at Primus Partners.
As Rapido expands into food delivery and other verticals, Ola’s subscription pivot could also help it retain market share in core mobility services.
Regulatory Implications and GST Concerns
Ola’s new approach, however, could raise questions around tax obligations, particularly regarding Goods and Services Tax (GST). Traditionally, a 5% GST is levied on aggregator-facilitated rides. But platforms like Namma Yatri—run in association with workers’ unions—have been exempted from GST by the Karnataka Authority for Advance Rulings (AAR).
Others like Rapido, operating as e-commerce entities, are still liable for GST under current regulations.
“It remains to be seen how this shift will impact Goods and Services Tax (GST) taxation, especially as newer platforms with linkages to workers’ associations enjoy exemptions, while other incumbents remain liable to pay GST under current laws,”
said Soujanya Sridharan, a researcher at the Aapti Institute.
In fact, Uber had raised this very issue last year, challenging the discrepancy in GST treatment before both the Karnataka AAR and the GST Council, citing unfair competitive practices and lack of clarity in tax enforcement.
Consumer Impact Still Unclear
While this shift is clearly a win for drivers, the impact on consumers is still uncertain. Subscription-based models might lead to better service quality as driver churn reduces, but fare structures, availability, and dynamic pricing could still evolve as the business model matures.
Ola has not yet officially commented on whether this model will be expanded nationally or adapted for other verticals. However, the move signals a structural change in how ride-hailing platforms engage with their gig workforce and navigate regulatory grey zones.
As more platforms consider adopting SaaS models, regulators may face growing pressure to standardise rules, particularly around taxation and worker protections.
