Shutting down Uber in India was unwise
ajayshahblog.blogspot.ca
ajayshahblog.blogspot.ca
The RBI rule requiring a one time pin for all online transactions is unwise, a huge barrier to good UX, and should be removed.
Having said that, Uber is not being shutdown in India. Even if no changes are made to this rule by the Oct 31 deadline, which of the following is more likely: Uber leaving a country with several hundred million potential users, or Uber (and every other company who does online transactions) changing their UI flow to accommodate the RBI requirement?
Disclaimer: My company Summon competes directly with Uber.
So yes, this two factor authentication is a royal pain in the ass but it's very much required in a country in which the consumer is not the king.
So what should we do? Instead of ensuring that consumer protection laws are improved and banks+law enforcement agencies and made answerable; let us make the consumer's life tougher. I am sure that it is always easy to make laws that can control sections/units than to control masses.
Now let us see if it a slight inconvenience to the consumer of there is a bigger picture behind. All these security measures (such as two factor authentication, chip based cards etc etc) involve costs. So who is going to pay for the costs? Would RBI pay for it? Would the banks pay for it? I do not think so. It is going to be the end consumer who is going to pay for all this.
If you do not believe me, read this article on timesofindia (titled: Banks seek to cap free ATM use at 5 times per month), you would realize that you would need to pay in case you took out money from your account (from your very own bank's ATM) from an ATM more than 5 times a month. What does this mean? I need to pay for taking out MY OWN MONEY!
So let us get real! Look for solutions for betterment of people in reality and not just in a phony manner!
RBI cannot wait for these laws to be enacted. In the interim they've taken these steps and this is not done in a phony manner.
Regarding costs - ultimately the consumer will pay for added security - be it the two factor authentication or the chip cards or any other security or protection measure. There's no debate about that. However, in case of a disputed transaction the cards company/Uber will need to own up responsibility which they won't.
Well, this authentication is RBI's solution for betterment of people, comes at a convenience cost though. If you think there are better alternatives, it wouldn't hurt to shoot an email to the RBI team. Actually let me see if that's even possible.
edit: I realise this is slightly off-topic and doesn't change the central premise of the article, which is that the legislation that forced Uber to employ a loophole is a bad thing. But what the hell, I'd go out of my mind if a paying for a taxi took 10 minutes.
you won't go "out of your mind" if this happens because when it's happening it seems totally normal and you will take it completely in stride unless you are late for a flight or are just a complete asshole. i was going back to a wedding and was kind of drunk and didn't really care. it's only when you analyze this on a macro level as a business practice that it seems insane.
Really? Up in the hills in a place with no cellphone connection?
I don't know California, but here you could be driving for hours without finding an ATM if you're far enough in the mountains.
Forced? That's quite the spin. Another way to look at it is "legislation that Uber didn't like so chose to ignore."
Despite the bad example, the wider point about the RBI restricting payments innovation and international trade in many different ways stands....
There is a simple solution that addresses the UX, the pain and the RBI regulation - pre payment. I make pre-payments once in a while, and the cost of my rides gets deducted from it.
There are hundreds of MNC operating in India, including global giants like Pepsi, MS, etc. Though they are not entirely clean themselves especially when it comes to factors such as environmental clearances, at least on paper none of them messes with RBI's financial guidelines. It is the RBI's job, to check anyone who is playing with the financial rules in place in India. Had Uber tried to negotiate, and negotiate hard.. it wouldn't have ended up shutting down.
Uber had a good chance to learn from Paypal, and what led to its demise was exactly the same thing .. avoiding the extra precautionary measures in place in India. Instead of giving in to RBI, taking a stubborn stand. The CEO was supposed to innovate the strategy at this point.
Amazon had previously kept itself away from the same tangle, and for years Indian e-commerce was dominated by ebay, until recently. Amazon re-entered the Indian market, albeit on attempt 3 or 4 now as Amazon.in
Now that is done and over, Uber's re-entry would become much harder, cause as they say "first impression is the last impression"
Money was being moved through USA, to avoid adhering to India's jurisdiction on Credit Card charge rules.
RBI is fairly paranoid about forex (like cofeposa).
But I think Uber was schooling the taxis in B'lore on how to deal with customers. Would be a shame if they cancelled out that part for the payment convenience.
Ignore the payment details, the pickup service itself was bloody convenient when I visited Bangalore last month, because I didn't need to have two phone conversations on a pick up about "where are you saar?" and "I see a building called Shiv Sagar on my left".
I'd rather buy "Uber credits" or something, just to avoid that.
With Uber, you can prepay per month a certain amount with all the two factor authentication and just use it. I understand the complications like how can we authenticate the user when he/she boards and make sure the account has (enough) credit, etc. But I think they should be workable.
In India autorickshaws are ubiquitous, extremely cheap, and I never had any problems paying. I was never tempted to try to find a taxi instead, although if I was there for more than a couple of weeks the pollution (autorickshaws are open at the sides) would get old fast.
How? On what planet? This takes about 30 seconds, tops. Why is the driver digging around for change? Are you too cheap to round the tip to the next bill?
To solve the problem Uber solves please read the following handy tips:
1. Carry cash, in your wallet, if you're unfamiliar with it, you may obtain it at an ATM.
2. As you're approaching your destination look at the meter, this will be roughly the amount of cash you'll need. Move the decimal to the right one digit and multiply by 2, this is the tip. Add it to the amount on the meter.
3. Select the closest amount of bills to this amount eg. 20.57 means a $20 bill.
4. Hand this to the driver, say 'keep the change' and get out of the car.
Followed by what I'm taking to be a very American centric idea of how a taxi ride is completed.....
Please enlighten me as to how paying for a taxi cab ride could be anymore complicated than taking an amount of cash in excess of the bill, handing it to the driver, and exiting the vehicle.
Also the requirement of 2 factor authentication is there for all CNP (Card not present) transaction, you need to understand that the number of fraud which is detected due to international transaction is rising and it becomes very difficult for individuals to process the chargeback. I was victim of card theft used to do international transaction on some random site.
I like this decision, and Uber can use a card reader on the device like Square in India or Pre paid wallet.
And it should be that way.Why should a local payment be routed outside and after an Ed'Snowden episode , i would rather feel more secure with things kept simple.
India like most countries has its own homegrown payment networks and i don't think it would be very difficult to run such businesses in India.
1. 3-wheeler "autos" are ubiquitous. Wait times are essentially zero, they are cheaper than taxis, and payment takes maybe a minute at most because the driver is willing to negotiate.
2. Most people still book cars by phone because the vast majority of Indians don't have access to smartphones or internet all the time.
3. Credit Card penetration is tiny (I believe ~5-10%, but might be wrong). Cash is, and will be, the dominant form of payment processing for a long time.
I'm not commenting on whether or not Uber should be in India. Just their departure isn't as detrimental to the GDP as this post claims.
Uber is not targeted at "most" people.
(I am going to lose a lot of karma for this post, but sometimes the right thing needs to be said)