It is high time that the Consumer Affairs Authority (CAA) steps in to regulate the rapidly growing online taxi and food delivery industry in Sri Lanka. As the sector is still relatively new, service providers operate with minimal oversight — resulting in a one-sided marketplace where consumers are often at the receiving end of unfair [...]

Business Times

Need to regulate online taxi and food delivery services

Letter
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It is high time that the Consumer Affairs Authority (CAA) steps in to regulate the rapidly growing online taxi and food delivery industry in Sri Lanka. As the sector is still relatively new, service providers operate with minimal oversight — resulting in a one-sided marketplace where consumers are often at the receiving end of unfair practices. The conduct of some companies reflects a “bull in a china shop” attitude, aggressively pursuing profits with little regard for consumer protection or accountability.

A major concern is that one of the two dominant players is based overseas, with communication limited to in-app channels. Given the low level of digital and AI literacy among local consumers, addressing complaints through apps alone is impractical and ineffective. This creates a serious gap in consumer redress and protection.

The common areas of concern among food delivery services are imposition of multiple hidden charges such as – small order fees, handling fees, high-demand surcharges, lack of transparency on how these charges are calculated, and frequent delays and poor customer service with no effective means of complaint resolution.

Common issues among online taxi services are surge pricing during rush hours or rainy weather, leading to unreasonably high fares; driver misconduct, including cancelling rides when payment is via credit card, not ending trips when the customer has exited the vehicle, resulting in inflated bills, dangerous or reckless driving behaviour, drivers “terminating” trips at their own destinations or homes to increase fares, and verbal abuse when orders are cancelled

Given these issues, there is an urgent need for regulatory oversight to ensure transparency, fair pricing, and effective mechanisms for complaint handling. The CAA should establish clear guidelines on service charges, surge pricing, and driver conduct; mandate local customer service channels for companies operating from abroad and set up a dedicated grievance portal for consumers facing issues with online platforms.

Without such regulation, consumers will continue to face exploitation in an unregulated marketplace.

Upali Weerasinghe   Colombo

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