Grab drivers to pay less commission if distance or time to pick-up is longer

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SINGAPORE – On Nov 14, ride-hailing giant Grab will introduce dynamic commission rates for drivers who use its platform so that the distance travelled and time taken to pick up passengers are taken into account when calculating their earnings.

The move, which comes amid an ongoing driver crunch in the ride-hailing sector here, will ensure that its drivers are more fairly compensated and less likely to cancel less favourable bookings, said the Nasdaq-listed company on Tuesday.

This new “service fee” may be lower when drivers have to travel farther and spend more time getting to a pick-up point, Grab said.Conversely, the service fee may be higher if the driver is closer to the pick-up point and spends less effort getting there. The new driver earning structure will apply to all of Grab’s transport services, except for GrabShare, Hire, Standard Taxi, GrabHitch and GrabCoach.

Because of this, Grab’s data showed that under the current structure, drivers are more likely to cancel a booking if they think the pick-up distance or time is too long. But he noted that the current high demand for ride-hailing services and the lack of active private-hire cars on the road mean that drivers are often assigned farther rather than nearer pick-ups, especially during peak hours.“For some trips, Grab takes more, but for most trips they will take less. For more than half of the trips, there is no real change,” he added.

Ms Yeo Wan Ling, adviser to the National Private Hire Vehicles Association , said drivers have shared how they need to drive longer to get to passengers, which has led to added costs, especially given increased petrol prices.

 

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