Karnataka government earlier this week issued a notice to suspend Ola's license for six months for violating government rules by running motorcycle taxis which are not allowed for safety reasons. Karnataka government kept the doors open on Saturday to have talks with Ola, the local ride-hailing service provider, to avoid a ban that could help rival Uber build market share.
Bengaluru, the state capital and technology hub, is among Ola’s top three markets in India. VP Ikkeri, the state commissioner for transport and road safety, informed media that the department had seized and issued fines for approximately 258 bikes during a probe after complaints. Ola's permit, obtained in 2017 and valid to 2021, allows it to run three and four-wheeler taxis in the state. The company, backed by SoftBank Group Corp and Tencent Holdings Ltd, has until Monday to respond to the suspension notice.
Following a complaint on the same, the RTO conducted a probe and prepared a report where Ola was found to be at fault. In February, 500 bike taxis were seized for operating illegally. Ola and Rapido, a bike taxi aggregator service, was ordered to halt services. "It's a temporary suspension and if they give us a satisfactory response, then we won't need to implement the ban," Mr. Ikkeri said, adding that Ola would face financial penalties. Ola did not immediately respond to a request for comment. It could lose out badly to Uber if pushed out of the market for an extended period. Ikkeri also mentioned that the department had also sent a notice about penalties to the last known address of Rapido. However, the motorcycle taxi operator could not be reached for comment despite multiple attempts.