Booking a ride? Grab, Gojek, Tada, CDG Zig trips to cost up to 50 cents more from Jan 1

SINGAPORE - Passengers who use ride-hailing apps Grab, Gojek, Tada and ComfortDelGro's CDG Zig will pay more per trip from 2025 when the four operators hike platform fees, a move they say is meant to cover costs arising from the upcoming Platform Workers Act.

Grab, the largest ride-hailing firm here, will raise its platform fee by 20 cents from 70 cents to 90 cents per trip from Jan 1, 2025.

In an e-mail announcement to its users on Dec 24, Grab said this increase in platform fee will account for contributions to its workers' Central Provident Fund (CPF) accounts, work injury compensation and other welfare initiatives.

Similarly, Gojek will raise its platform fee by 30 cents to 50 cents per trip starting from Jan 1, 2025. This is up from the current 60 cents to $1 per trip. The operator, which announced this on its website, said the revised platform fee will range from 90 cents to $1.50 for every trip.

ComfortDelGro, the largest taxi operator in Singapore, will follow suit and raise its platform fee by 30 cents to 50 cents, from a flat rate of 70 cents to a range of $1 to $1.20 based on distance travelled and travel time.

Likewise, Tada said in an e-mail to its customers that it would raise its platform fee by 50 cents, before goods and services tax. This means that its platform fee will go up from the current range of 55 cents to 75 cents, to a new range of $1.05 to $1.25 from Jan 1, 2025, before GST.

Grab, Gojek and Tada also said they will extend a "driver fee" charge beyond 2024.

Gojek said in an e-mail to customers that the current charge of 50 cents for trips below 10km and 80 cents for trips further than 10km will remain in place until March 31, 2025.

As for Tada, its driver's fee charge of 50 cents to 80 cents will remain until June 30, 2025. This fee will be credited entirely to drivers to help offset their operating costs.

Grab's driver fee of 50 cents per ride will also be extended until June 30, 2025.

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The four operators attributed the platform fee hike to the Platform Workers Act, the new law passed by Parliament in September that will come into force in January 2025.

The Act provides greater labour protections for private-hire car drivers, cabbies and delivery workers who rely on these online matching platforms for their work.

Citing a study which stated that additional costs for platform companies could amount to an estimated US$368 million (S$499 million) over the next five years due to the new law, Grab said the platform fee increase arose from a need to balance supporting platform workers' welfare with maintaining a sustainable service.

Looking forward, Grab added that its platform fee may rise accordingly as the Government will gradually increase CPF contributions for platform workers over the next five years.

In a notice posted on its website on Dec 20, Gojek said the fee hike is intended to "protect (drivers') earnings" in support of the new law.

It added that the fee, which is automatically charged to customers upon booking, will be used for initiatives to improve and maintain Gojek's ride-hailing services for all users.

This platform fee is calculated based on factors such as the distance travelled and duration to ensure that prices remain fair and competitive for both customers and drivers, said Gojek.

Tada said its platform fee adjustment is required to maintain current app features and develop new ones to improve customers' ride-hailing experience, as well as to support the roll-out of the new Platform Workers Act.

It added that it will provide its drivers with comprehensive insurance coverage and contribute to the CPF accounts of eligible drivers.

"These measures provide greater financial security for our driver-partners and demonstrate our commitment to being a responsible and progressive platform operator," said Tada.

Mr Tommy Tan, the chief executive of ComfortDelGro Taxi, said CDG Zig's platform fee adjustment will go towards enhanced protection and welfare initiatives that are part of the new law.

The Straits Times has asked Ryde if it also plans to raise its platform fees.

Under the new Act, platform companies will be required to contribute more to the CPF accounts of younger platform workers.

Platform operators will start with contributing 3.5 per cent of a worker's net earnings in 2025. This will go up incrementally to match what employers of companies that are not ride-hailing or delivery firms contribute in 2029.

These higher CPF rates will be compulsory for platform workers born on or after Jan 1, 1995, and optional for older workers.

The law also makes it mandatory for all platform operators to provide platform workers with work injury compensation insurance with the same level of coverage as employees.

The Ministry of Manpower said on Dec 17 that more than 8,000 platform workers have opted in for higher CPF contributions under the Platform Workers Act since Nov 1.

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Comfort cabby Ang Li Wei said she was happy to see the fee changes.

"Knowing that I will have work injury compensation insurance gives me peace of mind. Plus, the increased CPF contributions gives me more security for my future, especially when it comes to retirement planning," said Ms Ang, 38.

Most ride-hailing app users The Straits Times spoke to said they understood that fees had to go up to improve workers' welfare.

Finance manager Alvin Lee, 35, who uses ride-hailing services at least five times each week, said the fee hikes were "still acceptable" as they were below $1 per trip.

He added that he saw it as a way to show support for platform workers.

Ms Jasmine Gunaratnam, who works at an insurance company, echoed this sentiment, adding that she will not cut down on her daily ride-hailing trips.

Instead, the 40-year-old said she will adjust her spending elsewhere to make up for the increase in transport costs.

She described the platform fee increase as a "reasonable price to pay for platform workers to secure retirement adequacy".

But some drivers, such as ComfortDelGro cabby Noor Hamzah, are worried that passengers may choose to boycott these apps because they have to pay more for each ride, which may result in a loss of income.

Mr Hamzah, who has been a taxi driver for 9½ years, said he was concerned that cabbies could suffer a loss in income in the long run.

Meanwhile, the four firms' decision to hike fees on the same day has come to the attention of the Competition and Consumer Commission of Singapore (CCCS).

The competition watchdog said it takes an interest in price increases by competitors on the same day and that it is actively monitoring the situation.

"We will not hesitate to investigate and take enforcement action if any evidence of anti-competitive conduct is detected," said CCCS.

"We encourage the public to come forward with any information or evidence which may suggest coordination on pricing among ride-hail platforms."

This article was first published in The Straits Times. Permission required for reproduction.