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Ola has been giving huge discounts to users is well known. What Ola and Uber like apps do is also give huge incentives to drivers! This is to ensure that drivers accept requests for short and small rides, which are normally not profitable. These double incentives, to users and drivers is why these companies make huge losses. In 2016 alone, Ola made close to 2500Crore of losses!

To reduce these losses, Ola has been reducing incentives to drivers. But this is creating problems because drivers have to repay car loan emis, and now they are not making enough money. Today, drivers are having to work close to 15-16 hours a day, just to make close to the same money they were making one year ago. Therefore, drivers are unable to pay their car loans. And now State Bank of India has stopped issuing loans and seized around 300 cars. Out of Rs. 60 Crores lent, more than 16Crores (close to 30%) is now in danger of recovery.

How are such companies like Ola and Uber able to give such discounts and have so much losses year after year? If you are running a business where you buy an item at Rs 10/- and sell it at Rs 11/-, but tomorrow someone else comes and sells the same item at Rs 9/-, will people buy the item from you? You will finally close your business. And once everyone like you has closed their business, the new person can charge Rs 20/- also, and everyone will have to buy the item from him. This is what the companies like Ola and Uber are doing. They are killing the local transport business of auto drivers and local cabs. They are creating false employment for drivers. Who is making money finally? Did you know Ola CEO salary is 5.6 Crores?

Be careful when you use apps that give unbelievable discounts. You may be putting the jobs of many people at risk, including those who leave their hometown and come to cities and become Ola drivers.