US-based ride-hailing firm Uber confirms the 10 percent limit on the commission that it can charge on auto fares in Bengaluru is not financially viable and that the aggregator’s services in the city could be affected as a result.

According to reports, if the costs cannot be covered through commissions, the company will have to find ways to offload costs that could impact the experience of drivers and riders. In the face of these commission caps, the company may have to make the difficult decision to limit Uber Auto to select parts of Bengaluru where the service is viable.

Reports suggest that, the government was planning to request the Karnataka High Court to ratify its interim order to charge a 10 percent commission put in place two weeks ago. This followed talks between the government transport department and the aggregators.

Short rides - less than five kilometres – are likely to be affected as the 10 percent commission will not cover the aggregator’s fixed costs.

Uber says, “Fixed costs enable a number of additional services on the Uber app in addition to the service of matching demand and supply of drivers and customers.”

Nitish Bhushan, head of central operations, Uber India & South Asia says, “We have very transparently listed out all the services which drivers and riders get on an auto trip that happens on a ride sharing platform like Uber.”

These include multiple critical safety features like 24*7 helpline; background checks of drivers, real time trip tracking, and digital payments among others services.

Bhushan says, “Then there is the cost of actually running and scaling this platform, like tech costs, engineering costs, employee costs, and marketing costs associated with adding more drivers and riders.”