ETtech Explainer: Why Uber is in hot water over ‘advance tipping'
In a post on X, union minister for consumer affairs Prahlad Joshi wrote, "The practice of 'Advance Tip' is deeply concerning. Forcing or nudging users to pay a tip in advance, for faster service is unethical and exploitative. Such actions fall under unfair trade practices. Tip is given as a token of appreciation not as a matter of right, after the service".
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Ride-hailing company Uber faced pushback from the government this week for its advanced tipping feature , with union minister Pralhad Joshi terming it 'unethical'.Let's take a look at the events.Uber has introduced an "Advance Tip" feature in its app, which allows users to tip drivers before booking a ride, with the suggestion that doing so may lead to faster service. The app prompts users to add a tip of Rs 50, Rs 75, or Rs 100 during the booking process, stating, "Add a tip for faster pickup. A driver may be more likely to accept this ride if you add a tip."The app also mentions that 100% of the tip goes to the driver, and once added, it cannot be changed.Consumer watchdog Central Consumer Protection Authority (CCPA) has issued a notice to Uber regarding this feature, labelling it as an unethical and unfair trade practice. Consumer affairs minister Joshi took to X to criticise the practice, stating that tipping should be a voluntary gesture of appreciation after the service, not a precondition for receiving timely service."Taking cognisance of this, I had asked CCPA to look into it and today CCPA has issued a notice to Uber in this regard, seeking explanation from the platform. Fairness, transparency and accountability must be upheld in all customer interactions," Joshi said in the post.The tip move has also created a controversy on social media, with Uber trending on X. One user wrote, "This whole 'advance tip' scam started with Bengaluru autos and was pushed by Namma Yatri. Now it's spread like a virus — even Uber and Rapido have picked it up."Replying to the minister's post, another user wrote, "Not just that, now Uber has stopped showing fare. It asks us to "continue without seeing fare". Fare shows only after driver is matched. How can this be allowed?"Users also pointed out that this "unethical" practice was spreading to other apps like Ola Cabs and food delivery companies Swiggy and Zomato In January 2025, Uber was under the lens of the CCPA over allegations of differential pricing based on users' mobile operating systems. Reports and social media posts suggested that fares for identical rides were higher when booked through iPhones compared to Android devices. The CCPA had issued notices to both Uber and its competitor Ola, seeking explanations for the alleged pricing disparities.
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