Rapido fined ₹10 lakh over ‘auto in 5 minutes, ₹50 cashback’ promise

New Delhi (The Uttam Hindu): Bike-taxi service provider Rapido has had to pay a heavy price for misleading customers by running misleading advertisements. The Central Consumer Protection Authority (CCPA) has imposed a hefty fine of Rs 10 lakh on the company. The authority has not only directed Rapido to immediately stop the misleading advertisement, but has also ordered it to refund the actual cashback amount to the affected customers.

What is the whole matter?

To increase its penetration in urban areas, Rapido had been running advertisements with attractive promises like “Guaranteed Auto”, “Auto in 5 minutes” and “₹50 cashback” for some time now. Attracted by these advertisements, a large number of consumers were using the service, but they were not getting the promises made in the advertisements. Due to this, a lot of complaints had started coming against the company since June 2024.

Cheated in the name of cashback

The biggest discrepancy found in the investigation was the “₹50 cashback” offer. CCPA found that Rapido was promoting it as a cashback in the advertisement, while in reality customers were being given 'coins' instead of real money. These coins could be used only for the next ride and their validity was also only 7 days. The authority has considered this as a direct fraud with consumers and an unfair trade practice.

Complaints were not being resolved

Consumers had consistently complained that Rapido neither provided rides on time as promised nor gave cashback. Apart from this, there were also a large number of complaints related to the behavior of drivers and non-refund, more than half of which were not resolved.

CCPA's strict decision

Taking cognizance of these complaints, the Central Consumer Protection Authority (CCPA) has made it clear in its order that Rapido is misleading customers. Due to this, the authority has imposed a fine of Rs 10 lakh on the company as well as issued several strict instructions. Under these instructions, Rapido has been asked to immediately stop broadcasting all its misleading advertisements, return the real cashback of ₹ 50 in place of coins to the affected customers, and submit a report of compliance with the order within 15 days. This decision of CCPA is a strong message to all those companies who try to lure consumers through false promises and hidden conditions.