The ride-hailing app that lets passengers bargain for a good price, has arrived in South Africa. inDriver, used by 20-million people across more than 200 cities, has officially launched in Cape Town, with other cities to follow.
The app’s Real Time Deals (RTD) model allows passengers to set their own fare for their selected route. Nearby drivers are sent the destination and proposed fare, which they have the ability to accept – or the option to bargain for more money. Pre-approved rates in the app give guidance, but the final fare is set by the passenger and driver in a real-time negotiation.
Once the counter-offers are in, passengers select their best fit driver in line with what categories are most important to them – fare, driver rating, estimated time or arrival or vehicle model.
“The model, built to counter price surging, has proven adaptable and profitable for a variety of markets across Eastern Europe, Latin America and in Tanzania, where it launched last year,” says inDriver spokesperson Lerato Moroe.
It all started on a Russian social network, with a group of indignant taxi riders who objected to price surges when temperatures dropped below minus 45-degrees Celsius. In just six months, more than 60 000 people had joined the group – an opportunity that inDriver CEO and founder Arsen Tomsky leapt on.
Since securing $10-million in Series B funding from Leta Capital VC and moving its headquarters to New York City, inDriver has embarked on a large expansion project. If its track record is anything to go by, the company will see rapid uptake in the African market.
“Within four months of launching in Latin America, inDriver had completed over one million rides in the region and their second million followed just three weeks after that,” says Moroe. In October 2018, the app reached 10-million Google Play installs.
The service pulls drivers in by waiving commission charges for the first six months and subsequently charging commission fees well below those of its competition. One way it achieves this without compromising profitability is a return to cash payments, which cut out transaction fees and other costs associated with middlemen.
“Drivers on the app have full freedom to choose any ride request they like. They can see the fare offered, from point A to point B, and then decide if they want to accept the request. Passengers on inDriver pay on average 20%-30% less than with other services. They are able to share the details of their ride with a friend, providing added security,” says Moroe.