Centre proposes easier cab rental rules, cuts minimum fleet requirement from 50 to 5

The Centre has proposed reforms to simplify cab rental licensing, reduce the minimum fleet size from 50 to five and strengthen passenger safety. The proposed framework also includes faster approvals, digital compliance, grievance support and provisions for driver welfare

New Delhi: The government has proposed reforms to make cab rental businesses easier to start and operate, expand rental choices and strengthen passenger safety, according to an official statement.

The Ministry of Road Transport and Highways proposed the framework that combines simpler procedures with better customer support, also making entry into cab business easier to multiply choices for customers.

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Operators could gain the option to offer cabs with or without drivers. The minimum fleet falls from 50 to 5, with at least 2 cabs per place of operation and the requirement for branches in five tourist cities may be dispensed.

“A single licence, valid across the State or UT for a uniform fee, replaces separate main and branch licences. Approved places of operation may include airports, stations and bus terminals,” according to the ministry.

It proposed that licence grants and renewals should be done within 60 days. A 30-day deemed-approval mechanism may be introduced for adding or removing cabs or places of operation.

Electronic VAHAN registers and automatic data retrieval simplify compliance and reduce paperwork.

“Cabs must have location tracking, child restraint systems (optional) and first-aid kits. Operators must provide a website, 24-hour grievance support, emergency repairs and towing,” the ministry said.

It further noted that operator-provided drivers would require police verification, with welfare under the Code on Social Security, 2020, adding that specified serious offences involving a cab or operator-provided driver will reduce an operator’s licence validity.

Apart from that, the government also proposed to offer Operators time to correct non-material violations before suspension or revocation is considered along with an appellate mechanism with electronic hearings.

Wider rental choices, safety equipment and round-the-clock grievance support will benefit renters, while lower entry barriers and simpler licensing will support smaller businesses and employment opportunities.