Now you can take an Uber ride even if you do not own a credit card

Now you can take an Uber ride even if you do not own a credit card

Thursday November 13, 2014,

4 min Read

Uber, the ride-hailing app, announced today that it has tied up with Paytm, a digital payments service provider based out of NCR. The move which has been kept under wraps for over a month, comes as a response to the Reserve Bank of India directive that was issued in August.

Till now Uber was storing user's credit card information and automatically deducting the ride charges from the account. According to RBI, a two-factor authentication is mandatory for 'Card-not-present' transactions in India. A 'Card-not-present' transaction is where one uses the numbers present on the card and is not carrying a physical card, in which case usually a One-time-password is sent to the user to secure the transaction.


Starting today, users can link their Debit Card or Bank Account via a Paytm wallet to the Uber account to pay for all rides. Users will have the option to add money to, or top up the wallet using multiple payment options.

RBI's directive - a blessing in disguise for Uber?

With the Paytm wallet move, Uber's services can now be used, potentially, by 600 million people who have a bank account with net-banking facilities. This leads to a 120X increase in its potential user base. Five million Indians own a credit card, and with the older payment system only these many could use the service.

"This opens up new avenues for us. We can launch the service into many more cities now," Bhavik Rathod, General Manager at Uber Bangalore told YourStory. On the new development Vijay Shekhar Sharma, Founder and CEO, Paytm said “With Uber, we share philosophy of offering incredible user experience in every customer interaction. Paytm aims to be India's ubiquitous one touch payment option and we are happy to extend it to Uber users.”

Allen Penn, Uber Head of Asia said,

This is an important milestone for us here, and is a strong proof point that we're working hard to address the needs and reach more riders in India, which in turns, means more earning opportunities for driver-partners.

Vehicle financing program for drivers

Only three days back Uber announced its Vehicle financing program in India, the first country outside of the US to have it. Under the program, Uber is partnering with the top lending companies across India, including AU Financiers and Shriram Transport Finance and Toyota Financial Services, to create vehicle financing schemes with low down payment, superior finance rates and faster turn-around time, all exclusive to Uber.

Uber has also worked out exclusive discounts on vehicles with leading automobile manufacturers like Mahindra, Maruti Suzuki, Tata Motors and Toyota.

"We’re creating an ecosystem that nurtures entrepreneurship; and over the next few years, hundreds of thousands of individuals will be able to purchase cars easily and take advantage of the benefits of Uber’s technology platform to start their own small business and enrich their lives," said a blog on Uber's website.

It is now clear that this move is aimed at getting more and more drivers on road with Uber to meet the surge in demand that the increased user base will bring along with it. Uber considers its drivers as entrepreneurs and calls the move an aim to empower grassroots entrepreneurship.

"With us drivers have the ownership of an entrepreneur, flexibility to work according to their schedules and potential to do more trips per hour which would mean more earnings per hour," Rathod told YourStory.

Uber claims that the ETAs for its rides in Bangalore are as low as eight minutes. "We share real-time data with our drivers. Our heat maps show where the demand is increasing and the driver can accordingly move to those areas."

It remains to be seen whether riders will be able to get an Uber given the increase in demand. Rathod refused to discuss the number of cars on road. Many riders will for the first time take an Uber ride within the next few weeks and Uber will hope its Vehicle financing program brings enough drivers on-board to provide the same experience to first-time riders that Uber is known for.

Special offer for YourStory readers

Sign up with code UBERWALLETYS and get Rs 300 off your first ride with Uber. Valid upto November 30, 2014