Grab to charge additional S$0.30 'platform fee' for rides, following lifting of restrictions by competition watchdog

Grab to charge additional S$0.30 'platform fee' for rides, following lifting of restrictions by competition watchdog

Commuters wait for a train next to Grab transport booking service app advertisements at a train sta
Commuters wait for a train next to Grab advertisements at a train station. (File photo: Reuters/Edgar Su)

SINGAPORE: From Dec 18, Grab customers will have to pay an additional S$0.30 fee for all rides except for GrabHitch and GrabResponse. 

This follows the lifting last month of measures imposed on Grab by the Competition and Consumer Commission of Singapore (CCCS). The restrictions were put in place in September 2018 over Grab's merger with Uber.

"This platform fee will go towards funding initiatives that will make rides better, safer and more secure for you and our driver-partners," said the company in an announcement on Friday (Dec 11).

READ: Competition watchdog lifts measures on Grab as private-hire regulatory framework takes effect

READ: Commentary: We got to know Grab for its transport business. That will soon change

Two-thirds of the fee will go towards maintaining, developing and enhancing product features in terms of safety, security and quality and productivity, said Grab. 

The remaining one-third will then go to initiatives to support drivers such as benefits and training allowance. 

In an FAQ on its website, Grab said that when users book a ride, the quoted fare will include the platform fee. 

For taxi-metered fare trips, the platform fee will be added to the booking fee. For example, if the booking fee is S$2.30, the S$0.30 will be added to this amount. 

Passengers will be able to view the details of their fare breakdown in the final receipt. 

READ: Commentary: Is trouble brewing in Grab paradise?

Grab added that the platform fee was different from the commission it collects from drivers, as this is charged as an additional fee on top of the commission. 

"The commission is levied as a percentage of the trip fare, excluding the platform fee," said Grab. 

The commission received supports operational costs, which includes post-ride service and cashless payment transaction costs like credit card charges, it added. 

Last month, CCCS announced that Grab had submitted an application in July to impose the S$0.30 platform fee for ride-hailing services. The commission said it would no longer issue a decision on the application, after the lifting of the directions imposed on Grab.

CCCS issued an infringement decision against Grab and Uber in September 2018, in relation to the March sale of Uber’s Southeast Asian business to Grab for a 27.5 per cent stake in the Singapore-based firm.

The deal led to a “substantial lessening of competition” in the ride-hailing market, CCCS said then, highlighting Grab’s increased prices and changes to its loyalty programme after the merger.

Source: CNA/ad