July 23, 2017

Banks pull back car loans to Ola, Uber taxi drivers on falling income

Ola logo
Image Courtesy of Ola

Driver incomes are falling because both Ola and Uber had cut down on driver incentives, prompting taxi driver strikes in Delhi and Bengaluru earlier this year. Photo: Pradeep Gaur/Mint Mumbai/Bengaluru: A fall in incomes of taxi drivers who work with cab aggregators Ola (ANI Technologies Pvt. Ltd) and Uber (Uber Technologies Inc.) have prompted some of India’s top banks to pull back on car loans to them and tweak underwriting norms.

In some cities, banks had stopped lending to Uber and Ola drivers as early as a year ago.

“We stopped giving car loans to drivers in Bengaluru last year. However, we remain invested in this segment of loans,” said Rajnish Kumar, managing director at State Bank of India, one of the largest disbursers of car loans.

“We continue to disburse loans in Hyderabad and Chennai after tweaking the underwriting standards,” added Kumar without revealing details of what SBI was doing to protect its loans.

SBI has advanced around Rs120 crore to drivers of these ride-hailing companies.

Tata Motors Finance Ltd, which has funded around 2,000 Ola and Uber vehicles, has also tightened its credit norms, said its managing director Shyam Mani. “Till March, Uber was covering up for losses beyond a certain level […]

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The News for the Gig Economy Staff is constantly searching the web for the latest news regarding freelancing and gig platforms to bring them to you in one handy place. All articles with this generic author have been sourced with the original location at the bottom of the piece. We encourage our readers to view the original source of all excerpts. NGE is a project of ARC Online, LLC.

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