Bike-sharing thru’ apps on decline, forcing cos to halt service

The once-thriving bike-ride sharing trend via apps has taken an unexpected hit, as a sharp decline in usage is forcing companies to halt their services, with 13 out of the 15 registered companies having non-renewed yearly licences.

However, three ride-sharing companies have meanwhile applied to the Bangladesh Road Transport Authority (BRTA), for licence renewal. Of the remaining 10, some have been entirely withdrawn from the market. 

The initial excitement generated by the companies has now waned, particularly as people began to embrace off-app rides, a practice that had existed in some regions of the country long before the era of smartphone applications.

Only two companies - Pathao and Uber - have secured timely permit renewals, indicating their strong business performance.

Fahim Ahmed, managing director and CEO of Pathao, said, "Pathao Rides (Bike and Car) has seen strong growth over the past year, due to our relentless focus on driving value and satisfaction for customers, amidst inflationary pressures and a challenging macro environment."

"Being a fully-licensed ride-sharing company in the country, Pathao has grown five times over the past year, by offering users improved availability and the flexibility to negotiate fares, and drivers the opportunity for increased income," he added.

However, the registration applications of Jatri Service Ltd, Chaldal Ltd and Obhai Solutions Ltd for licence renewal are currently pending.

"As of 2022, our registration has expired, and our 2023 registration application is currently pending," said Shahriar Rubayet, deputy director of Chaldal Ltd.

He expressed frustration over the decrease in ride-sharing, saying, "We registered in 2019 and operated for approximately six months before being forced to shut down. The aggressive marketing approach of Uber and Pathao, along with the rise of off-app riding, made it financially unsustainable for us to continue operations."

The vice president of Jatri Service Ltd, Golam Ishfaque, stated, "We submitted our renewal application to the BRTA three months ago, which is still pending. We have pivoted towards long-distance trips, such as inter-city journeys, rather than shorter ones."

He observed, "The demand for bike rides has decreased, but calls for car rides remain consistent."

Syed Fakruddin Millat, deputy general manager (Corporate and Regulatory Affairs) of Obhai Solutions, stated that the intricate nature of the renewal system, coupled with technical glitches on the BRTA's system, had left Obhai unable to renew registration. 

The company, with its bike riding services remaining suspended, applied to renew its licence last week. Obhai Solutions now offers car and CNG (three-wheeler) ride services, and a delivery service. 

A sharp decline in calls for bikes through apps has existed since the Corona pandemic, said Millat, emphasising the need to address certain undesirable practices within the bike riders. 

He suggested that it could only be effectively tackled through the concerted efforts of BRTA and law enforcement agencies. 

Meanwhile, the BRTA warned of tougher action, and said it will not let anyone run a ride-sharing service without valid permission. 

"The organisations that have not renewed their registration will not be allowed to operate in future. It is clear that they have failed to renew their service due to lack of infrastructure to run their business," said Mahabub E Rabbani, spokesperson and road safety director of the BRTA.

Regarding some of the ride-sharing companies' allegations of a complex system and technical glitches at BRTA's end, Rabbani said that there were some issues but BRTA fixed those weeks earlier following some meetings with the companies. Now the entire renewal process can be done online from home. 

Regarding pending applications, he said, "They [the companies] might have failed to submit any of the required papers. Once they successfully provide all the papers, their registration will be renewed." 

However, a few companies are still in the process of developing their infrastructure, delaying their renewal efforts.

Iftekhar Hossain, the assistant general manager of Akij Online Ltd, shared, "We initially started with 260 customers but encountered technical issues with app development. The app's sluggishness and frequent hangs put us further behind."

"We have been searching for a foreign company to assist with troubleshooting and app development since then and found one. We plan to re-enter the market in mid-2024. We have engaged with the BRTA twice, and while their process is intricate, we are in discussions with them to expedite our renewal," said an optimistic Iftekhar.

Another company is Computer Network System Ltd. Its deputy managing director Ikram Iqbal said that since they have future plans to enter the ride-sharing service market, they secured the license early. 

"We are currently in the software development phase and have not yet commenced full-fledged operations. We will renew our permit before hitting the road."