- Some Uber and Lyft drivers are making deals with passengers for rides outside the apps.
- Drivers say they’re trying to offset low-paying gigs through rideshare apps.
- Logging out of apps raises safety and security concerns, the companies said.
Some drivers for ride-sharing services like Uber and Lyft are offering passengers an alternative: Get rid of the apps entirely, agree on a price and pay them in cash or through an app like Venmo.
Executives for the services told Business Insider that app spin-offs have become attractive as many have noticed their profits are falling. In the past, some have said that some rides only cost $3. Coming to a deal directly with their passengers offers a more profitable fare – even if it carries risks for both parties.
Posts on Reddit and Facebook groups include questions from drivers about whether it’s acceptable to ask drivers to cancel a ride they requested through the Uber or Lyft app and pay them another way. There are also some posts from passengers describing the other side of the interaction.
A TikTok post from last year appears to show an Uber driver asking a rider, who is filming the interaction, asking her to pay $70 in cash for a ride that Uber was paying her $80 for. The video appears to show the driver saying that Uber wasn’t paying her enough for the ride and that he was “just being nice” by offering her a discount on the ride. The poster did not respond to a request to discuss the video from Business Insider.
Michael Moya, who drives for Uber in Boston, said he often hears drivers debating whether to offer customers the option to opt out of the apps and pay using cash or a separate payment app like Venmo.
The option could fail, he said, including Uber and Lyft deactivating drivers’ accounts. “Some drivers have thought about accepting payments outside the app, but it’s risky,” Moya said. “We can lose our accounts if a passenger reports us, so most drivers try to avoid that.”
Canceling a ride can also cost riders. Uber charges a fee for passengers who cancel their ride request more than a few minutes after making it. Lyft, meanwhile, charges riders a fee for canceling “more than 30 seconds after the car accepts your ride,” according to the company’s website.
“We urge riders and drivers to only take rides requested through the Uber app for their own safety,” an Uber spokesperson told BI, adding that riders can record audio of their ride, press an emergency button or share their journeys with contacts. if the trip doesn’t go as planned.
“Off-app rides are prohibited by many regulations and our policies, and drivers who violate this policy risk losing access to the Uber platform,” the spokesperson said. Lyft did not respond to requests for comment from BI.
The financial incentive to make a deal with riders outside of apps can be significant.
Uber and Lyft have said their drivers earn upwards of $30 an hour before expenses. But some rideshare drivers’ pay is significantly lower than that — as little as $9 an hour, BI previously reported.
Both rideshare executives and delivery workers for services like Uber Eats and Instacart have said competition to claim the most lucrative gigs on the platforms has intensified in recent years.
Rideshare drivers told BI that they often earn less than half of what riders pay for the ride. An Uber driver in Massachusetts shared screenshots of a recent Uber ride that cost the driver about $156 — and paid the driver roughly $74 after Uber deducts its share plus taxes.
Many passengers the driver encounters don’t know that Uber drivers typically tip a portion of the fare — and some are more amenable to working around the app once they know, the driver said.
“I’ve talked to passengers who think we get all the money,” the driver said.
Do you work for a ride or gig delivery service and have an idea to share? Contact this reporter at abitter@businessinsider.com